Nonprofit malpractice insurer, the Pennsylvania Professional Liability Joint Underwriting Association (PPLJUA) plans to sue the state if Pennsylvania pushes ahead with taking away $200 million of its assets.
The PPLJUA was established in 1976 in relation to Subsection C. of the Medical Care Availability and Reduction of Error Act to provide medical professional liability insurance.
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Pennsylvania House Bill 118 contains language that would take $200 million from the PPLJUA under threat of abolishment. The bill was approved last Thursday by the full Senate by a vote of 37-13. It is currently being referred back to the House for final approval.
In response, the PPLJUA announced on Monday that it would file a lawsuit in federal court to block the state from taking the $200 million, reasoning that the state government is looking to balance its deficit-mired budget.
“The JUA is not a Pennsylvania agency, is not government funded, and is not state run,” PPLJUA president Susan Sersha said in an official statement. “The JUA money comes from premiums paid by medical practitioners and institutions for insurance and business operations. If HB 118 becomes law, the state would seize money that it does not own, and to which it has no right.”
“The state created the JUA as a private entity and is not on the hook for any liabilities that JUA incurs, including those resulting from medical liability actions against JUA insureds,” Sersha added. “Seizure of the JUA’s assets could potentially limit the healthcare services available in Pennsylvania and leave injured patients with no recourse should a healthcare provider be found liable for their injuries. If HB 118 is successful, this will be the Great Pennsylvania Heist, setting a precedent that could affect other state-licensed insurance providers, as well as other institutions, such as state-related universities.”
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