PA must return money to doctor-retention funds

A pair of court rulings this week could leave Pennsylvania scrambling to find hundreds of millions of dollars to fill a budget hole. Meanwhile, doctors are applauding the decision.

A pair of court rulings this week could leave Pennsylvania scrambling to find hundreds of millions of dollars to fill a budget hole. Meanwhile, doctors are applauding the decision.

Last year, Pennsylvania tapped two funds set up to keep good doctors in the state and help them with the rising cost of malpractice insurance.

Scot Chadwick is vice president of governmental affairs at the Pennsylvania Medical Society. The doctors group sued to get the money back.

Chadwick: Disagreements make for lawsuits but the Commonwealth Court ruled very clearly that Pennsylvania physicians and hospitals had a vested property right to that money and it was improper for the state to take it out for budget balancing purposes.

Pennsylvania took $100 million from the so-called MCARE fund, it’s a state-run program designed to subsidize the cost of malpractice insurance. The state also pulled $700 million from the healthcare provider retention fund which grew flush in recent years because of cigarette tax revenues.

Governor Rendell’s spokesman Gary Tuma says Pennsylvania will appeal the decision.

Tuma:
It would mean several hundred million dollars, perhaps as much as $800 million, which would be a huge hit to the state budget, which we’d have to make up. But as I say we are pretty confident that we can convince the Supreme Court that the decision was flawed.

Opponents of the court decision say the MCARE program has provided years of subsidies to doctors but now payouts for malpractice lawsuits have declined sharply. Tuma says that decline has created a surplus and Pennsylvania has the right to use the money where ever lawmakers believe it is needed most.