State tries to seize $275 million from medical liability fund
The Pennsylvania physician liability insurer of last resort is facing its third fight to stop the state from seizing hundreds of millions of dollars intended to pay potential claims and instead using it to close a budget gap.
At stake is more than $275 million held by the Pennsylvania Professional Liability Joint Underwriting Association (JUA). In 2016, the state attempted to expropriate $200 million and send it directly to offset its perennial budget shortfall. State officials argued then that the association's money was an unneeded surplus.
This time, in what critics charge is a disingenuous bureaucratic maneuver, Pennsylvania wants control of all of money. Instead of demanding the money outright, the General Assembly passed a new law placing the association under control of a board of political appointees who will be free to direct the money wherever they wish.
"The farmer has tapped the proverbial fox to guard the henhouse," observes a friend-of-the-court brief filed on behalf of the JUA by the Pennsylvania Medical Society and the Litigation Center of the American Medical Association and State Medical Societies. They have joined the case to protect the fund from what they say is a transparent bid to grab the cash.
"The defendants have already showed their hand, having tried twice before in the last two years to legislate the transfer of JUA funds to the Commonwealth. The defendants intend to divert the JUA's alleged 'excess' funds to the state's funds."
