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SENATE BILL 449
57
TH LEGISLATURE
-
STATE
OF
NEW
MEXICO
-
FIRST SESSION
,
2025
INTRODUCED BY
Larry R. Scott and James G. Townsend and Candy Spence Ezzell
AN ACT
RELATING TO LITIGATION; AMENDING REQUIREMENTS FOR VENUE
DETERMINATION; PROVIDING REQUIREMENTS FOR DETERMINING VENUE IN
CASES INVOLVING MEDICAL MALPRACTICE; AMENDING THE MEDICAL
MALPRACTICE ACT; LIMITING RECOVERY FROM THE PATIENT'S
COMPENSATION FUND; REQUIRING PAYMENTS FROM THE PATIENT'S
COMPENSATION FUND TO BE MADE AS EXPENSES ARE INCURRED;
REQUIRING SEVENTY-FIVE PERCENT OF THE PUNITIVE DAMAGES AWARDED
IN MEDICAL MALPRACTICE CLAIMS TO BE AWARDED TO THE STATE;
LIMITING ATTORNEY FEES IN MALPRACTICE CLAIMS; REQUIRING THE
SUPERINTENDENT OF INSURANCE TO APPROVE PROPOSED SETTLEMENTS
PAID FROM THE PATIENT'S COMPENSATION FUND; REMOVING A
REQUIREMENT FOR SURCHARGES TO BE SET WITH THE INTENT OF
BRINGING THE FUND TO SOLVENCY; CREATING THE PATIENT SAFETY
IMPROVEMENT FUND; MAKING AN APPROPRIATION.
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. Section 38-3-1 NMSA 1978 (being Laws 1875-
1876, Chapter 2, Section 1, as amended) is amended to read:
"38-3-1. COUNTY IN WHICH CIVIL ACTION IN DISTRICT COURT
MAY BE COMMENCED.--All civil actions commenced in the district
courts shall be brought and shall be commenced in counties as
follows and not otherwise.
A. First, except as provided in Subsection F of
this section relating to foreign corporations, all transitory
actions shall be brought in the county where either the
plaintiff or defendant, or any one of them in case there is
more than one of either, resides; or second, in the county
where the contract sued on was made or is to be performed or
where the cause of action originated or indebtedness sued on
was incurred; or third, in any county in which the defendant or
either of them may be found in the judicial district where the
defendant resides.
B. When the defendant [has rendered himself ] is
liable to a civil action by any criminal act, suit may be
instituted against the defendant in the county in which the
offense was committed or in which the defendant may be found or
in the county where the plaintiff resides.
C. When suit is brought for the recovery of
personal property other than money, it may be brought as
provided in this section or in the county where the property
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may be found.
D. [(1)] When lands or any interest in lands [are ]
is the object of any suit in whole or in part, the suit shall
be brought in the county where the land or any portion of the
land is situate; [(2) ] provided that [where ] if such lands are
located in more than one county and are contiguous, [that ] the
suit may be brought as to all of the lands in any county in
which a portion of the lands is situate, with the same force
and effect as though the suit had been prosecuted in each
county in which any of the lands are situate. In all such
cases in which suit is prosecuted in one county as to
contiguous lands in more than one county, notice of lis pendens
shall be filed pursuant to Sections 38-1-14 and 38-1-15 NMSA
1978 in each county. For purposes of service of process
pursuant to Rule [4] 1-004 of the Rules of Civil Procedure for
the District Courts, any such suit involving contiguous lands
located in more than one county shall be deemed pending in each
county in which any portion of the land is located from the
date of filing of the lis pendens notice.
E. Suits for trespass on land shall be brought as
provided in Subsection A of this section or in the county where
the land or any portion of the land is situate.
F. Except as provided in Subsection H of this
section, suits may be brought against transient persons or
[non-residents] nonresidents in any county of this state,
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except that suits against foreign corporations admitted to do
business and [which] that designate and maintain a statutory
agent in this state upon whom service of process may be had
shall only be brought in the county where the plaintiff, or any
one of them in case there is more than one, resides or in the
county where the contract sued on was made or is to be
performed or where the cause of action originated or
indebtedness sued on was incurred or in the county where the
statutory agent designated by the foreign corporation resides.
G. Suits against any state officers as such shall
be brought in the court of the county in which their offices
are located, at the capital or in the county where a plaintiff,
or any one of them in case there is more than one, resides,
except that suits against the officers or employees of a state
educational institution as defined in Article 12, Section 11 of
the constitution of New Mexico, as such, shall be brought in
the district court of the county in which the principal office
of the state educational institution is located or the district
court of the county where the plaintiff resides.
H. In a claim asserted by a personal representative
pursuant to Section 41-2-3 NMSA 1978, a conservator, guardian
or guardian ad litem appointed pursuant to Chapter 45, Article
5 NMSA 1978 or a third person acting in any representative
capacity, the residence of the person bringing the claim shall
not be considered in determining venue in any civil action.
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I. Subject to the provisions of Subsection H of
this section, venue in a claim asserting medical malpractice
shall be limited to the county in which the patient received
the medical treatment that is the basis for the medical
malpractice lawsuit. As used in this subsection:
(1) "medical malpractice lawsuit" means any
legal proceeding alleging a cause of action arising in this
state against a health care provider for medical treatment,
lack of medical treatment or other claim of departure from
accepted standards of health care that proximately results in
injury to a patient, whether the patient's cause of action
sounds in tort or contract, including actions based on battery,
wrongful death, unfair trade practices or negligent hiring,
supervision, training, retention or credentialing and excluding
a cause of action arising out of nonmedical acts related to the
operation, use or maintenance of a vehicular or aircraft
ambulance; and
(2) "patient" means a natural person of any
age who received or should have received health care from a
health care provider. "
SECTION 2. Section 41-5-3 NMSA 1978 (being Laws 1976,
Chapter 2, Section 3, as amended) is amended to read:
"41-5-3. DEFINITIONS.--As used in the Medical Malpractice
Act:
A. "advisory board" means the patient's
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compensation fund advisory board;
B. "control" means equity ownership in a business
entity that:
(1) represents more than fifty percent of the
total voting power of the business entity; or
(2) has a value of more than fifty percent of
that business entity;
C. "fund" means the patient's compensation fund;
D. "health care provider" means a person,
corporation, organization, facility or institution licensed or
certified by this state to provide health care or professional
services as a doctor of medicine, hospital, outpatient health
care facility, doctor of osteopathy, chiropractor, [podiatrist ]
podiatric physician, nurse anesthetist, physician's assistant,
certified nurse practitioner, clinical nurse specialist or
certified nurse-midwife or a business entity that is organized,
incorporated or formed pursuant to the laws of New Mexico that
provides health care services primarily through natural persons
identified in this subsection. "Health care provider" does not
mean a person or entity protected pursuant to the Tort Claims
Act or the Federal Tort Claims Act;
E. "hospital" means a facility licensed as a
hospital in this state that offers in-patient services, nursing
or overnight care on a twenty-four-hour basis for diagnosing,
treating and providing medical, psychological or surgical care
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for three or more separate persons who have a physical or
mental illness, disease, injury or rehabilitative condition or
are pregnant and may offer emergency services. "Hospital"
includes a hospital's parent corporation, subsidiary
corporations or affiliates if incorporated or registered in New
Mexico; employees and locum tenens providing services at the
hospital; and agency nurses providing services at the hospital.
"Hospital" does not mean a person or entity protected pursuant
to the Tort Claims Act or the Federal Tort Claims Act;
F. "independent outpatient health care facility"
means a health care facility that is an ambulatory surgical
center, urgent care facility or free-standing emergency room
that is not, directly or indirectly through one or more
intermediaries, controlled or under common control with a
hospital. "Independent outpatient health care facility"
includes a facility's employees, locum tenens providers and
agency nurses providing services at the facility. "Independent
outpatient health care facility" does not mean a person or
entity protected pursuant to the Tort Claims Act or the Federal
Tort Claims Act;
G. "independent provider" means a doctor of
medicine, doctor of osteopathy, chiropractor, [podiatrist ]
podiatric physician, nurse anesthetist, physician's assistant,
certified nurse practitioner, clinical nurse specialist or
certified nurse-midwife who is not an employee of a hospital or
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outpatient health care facility. "Independent provider" does
not mean a person or entity protected pursuant to the Tort
Claims Act or the Federal Tort Claims Act. "Independent
provider" includes:
(1) a health care facility that is:
(a) licensed pursuant to the Public
Health Act as an outpatient facility;
(b) not an ambulatory surgical center,
urgent care facility or free-standing emergency room; and
(c) not hospital-controlled; and
(2) a business entity that is not a hospital
or outpatient health care facility that employs or consists of
members who are licensed or certified as doctors of medicine,
doctors of osteopathy, chiropractors, [podiatrists ] podiatric
physicians, nurse anesthetists, physician's assistants,
certified nurse practitioners, clinical nurse specialists or
certified nurse-midwives and the business entity's employees;
H. "insurer" means an insurance company engaged in
writing health care provider malpractice liability insurance in
this state;
I. "malpractice claim" includes any cause of action
arising in this state against a health care provider for
medical treatment, lack of medical treatment or other claimed
departure from accepted standards of health care that
proximately results in injury to the patient, whether the
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patient's claim or cause of action sounds in tort or contract,
and includes but is not limited to actions based on battery or
wrongful death; "malpractice claim" does not include a cause of
action arising out of the driving, flying or nonmedical acts
involved in the operation, use or maintenance of a vehicular or
aircraft ambulance;
J. "medical care and related benefits" means all
reasonable medical, surgical, physical rehabilitation and
custodial services and includes drugs, prosthetic devices and
other similar materials reasonably necessary in the provision
of such services;
K. "occurrence" means all [injuries to a patient
caused by health care providers' successive acts or omissions
that combined concurrently to create a malpractice claim ]
claims for damages from all persons arising from harm to a
single patient, no matter how many health care providers,
errors or omissions contributed to the harm ;
L. "outpatient health care facility" means an
entity that is hospital-controlled and is licensed pursuant to
the Public Health Act as an outpatient facility, including
ambulatory surgical centers, free-standing emergency rooms,
urgent care clinics, acute care centers and intermediate care
facilities and includes a facility's employees, locum tenens
providers and agency nurses providing services at the facility.
"Outpatient health care facility" does not include:
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(1) independent providers;
(2) independent outpatient health care
facilities; or
(3) individuals or entities protected pursuant
to the Tort Claims Act or the Federal Tort Claims Act;
M. "patient" means a natural person who received or
should have received health care from a health care provider,
under a contract, express or implied; and
N. "superintendent" means the superintendent of
insurance."
SECTION 3. Section 41-5-4 NMSA 1978 (being Laws 1976,
Chapter 2, Section 4, as amended) is amended to read:
"41-5-4. AD DAMNUM CLAUSE--VENUE .--
A. A patient or [his] a patient's representative
having a malpractice claim for bodily injury or death may file
a complaint and demand right of trial by jury in [any] a court
of law having requisite jurisdiction and [demand right of trial
by jury] where venue is proper.
B. Venue in a malpractice claim shall be proper
when the claim is filed in the county in which the patient
received the medical treatment that is the basis for the
malpractice claim.
C. No dollar amount or figure shall be included in
the demand in [any] a complaint asserting a malpractice claim
and filed after the effective date of this section, but the
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request shall be for such damages as are reasonable. This
section shall not prevent a patient or [his ] the patient's
representative from alleging a requisite jurisdictional amount
in a malpractice claim filed in a court requiring such an
allegation."
SECTION 4. Section 41-5-6 NMSA 1978 (being Laws 1992,
Chapter 33, Section 4, as amended) is amended to read:
"41-5-6. LIMITATION OF RECOVERY.--
A. Except for punitive damages and past and future
medical care and related benefits, the aggregate dollar amount
recoverable by all persons for or arising from any injury or
death to a patient as a result of malpractice shall not exceed
six hundred thousand dollars ($600,000) per occurrence for
malpractice claims brought against health care providers if the
injury or death occurred prior to January 1, 2022. In jury
cases, the jury shall not be given any instructions dealing
with this limitation.
B. Except for punitive damages and past and future
medical care and related benefits, the aggregate dollar amount
recoverable by all persons for or arising from any injury or
death to a patient as a result of malpractice shall not exceed
seven hundred fifty thousand dollars ($750,000) per occurrence
for malpractice claims against independent providers; provided
that [beginning January 1, 2023 ] on the first day of each
calendar year, the per occurrence limit on recovery shall be
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adjusted [annually] by the prior three-year average consumer
price index for all urban consumers; and provided further that
an adjustment shall not result in a percentage increase in the
per occurrence limit on recovery greater than three percent .
C. The aggregate dollar amount recoverable by all
persons for or arising from any injury or death to a patient as
a result of malpractice, except for punitive damages and past
and future medical care and related benefits, shall not exceed
seven hundred fifty thousand dollars ($750,000) for claims
brought against an independent outpatient health care facility
for an injury or death that occurred in calendar years 2022 and
2023.
D. In calendar year 2024 and subsequent years, the
aggregate dollar amount recoverable by all persons for or
arising from an injury or death to a patient as a result of
malpractice, except for punitive damages and past and future
medical care and related benefits, shall not exceed the
following amounts for claims brought against an independent
outpatient health care facility:
(1) for an injury or death that occurred in
calendar year 2024, one million dollars ($1,000,000) per
occurrence; and
(2) for an injury or death that occurred in
calendar year 2025 and thereafter, the amount provided in
Paragraph (1) of this subsection, adjusted annually by the
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prior three-year average consumer price index for all urban
consumers, per occurrence; provided that an adjustment shall
not result in a percentage increase in the per occurrence limit
on recovery greater than three percent .
E. In calendar year 2022 and subsequent calendar
years, the aggregate dollar amount recoverable by all persons
for or arising from any injury or death to a patient as a
result of malpractice, except for punitive damages and past and
future medical care and related benefits, shall not exceed the
following amounts for claims brought against a hospital or a
hospital-controlled outpatient health care facility:
(1) for an injury or death that occurred
in calendar year 2022, four million dollars ($4,000,000)
per occurrence;
(2) for an injury or death that occurred in
calendar year 2023, four million five hundred thousand dollars
($4,500,000) per occurrence;
(3) for an injury or death that occurred
in calendar year 2024, five million dollars ($5,000,000)
per occurrence;
(4) for an injury or death that occurred in
calendar year 2025, five million five hundred thousand dollars
($5,500,000) per occurrence;
(5) for an injury or death that occurred
in calendar year 2026, six million dollars ($6,000,000)
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per occurrence; and
(6) for an injury or death that occurred in
calendar year 2027 and each calendar year thereafter, the
amount provided in Paragraph (5) of this subsection, adjusted
annually by the prior three-year average consumer price index
for all urban consumers, per occurrence; provided that an
adjustment shall not result in a percentage increase in the per
occurrence limit on recovery greater than three percent .
F. The aggregate dollar amounts provided in
Subsections B through E of this section include payment to any
person for any number of loss of consortium claims or other
claims per occurrence that arise solely because of the injuries
or death of the patient.
G. In jury cases, the jury shall not be given any
instructions dealing with the limitations provided in this
section.
H. The value of accrued medical care and related
benefits shall not be subject to any limitation.
I. Except for an independent outpatient health care
facility, a health care provider's personal liability is
limited to two hundred fifty thousand dollars ($250,000) for
monetary damages and medical care and related benefits as
provided in Section 41-5-7 NMSA 1978. Any amount due from a
judgment or settlement in excess of two hundred fifty thousand
dollars ($250,000) shall be paid from the fund, except as
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provided in Subsections J and K of this section.
J. An independent outpatient health care facility's
personal liability is limited to five hundred thousand dollars
($500,000) for monetary damages and medical care and related
benefits as provided in Section 41-5-7 NMSA 1978. Any amount
due from a judgment or settlement in excess of five hundred
thousand dollars ($500,000) shall be paid from the fund.
K. Until January 1, 2027, amounts due from a
judgment or settlement against a hospital or hospital-
controlled outpatient health care facility in excess of seven
hundred fifty thousand dollars ($750,000), excluding past and
future medical expenses, shall be paid by the hospital or
hospital-controlled outpatient health care facility and not by
the fund. [Beginning January 1, 2027, amounts due from a
judgment or settlement against a hospital or hospital-
controlled outpatient health care facility shall not be paid
from the fund.
L. The term "occurrence" shall not be construed in
such a way as to limit recovery to only one maximum statutory
payment if separate acts or omissions cause additional or
enhanced injury or harm as a result of the separate acts or
omissions. A patient who suffers two or more distinct injuries
as a result of two or more different acts or omissions that
occur at different times by one or more health care providers
is entitled to up to the maximum statutory recovery for each
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injury.]
L. As used in this section, "consumer price index"
means the consumer price index for all urban consumers, United
States city average, as published by the United States
department of labor, between the end of December of the
penultimate calendar year and the end of December of the
immediately preceding calendar year. "
SECTION 5. Section 41-5-7 NMSA 1978 (being Laws 1992,
Chapter 33, Section 5, as amended) is amended to read:
"41-5-7. MEDICAL EXPENSES AND PUNITIVE DAMAGES.--
A. Awards of past and future medical care and
related benefits shall not be subject to the limitations of
recovery imposed in Section 41-5-6 NMSA 1978.
B. The health care provider shall be liable for all
medical care and related benefit payments until the total
payments made by or on behalf of it for monetary damages and
medical care and related benefits combined equals the health
care provider's personal liability limit as provided in
Subsection I of Section 41-5-6 NMSA 1978, after which the
payments shall be made by the fund.
C. Awards of past or future medical care and
related benefits shall not be paid from the fund unless the
amount of the award was actually paid by or on behalf of an
injured person and accepted by a health care provider as
payment for services rendered.
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D. Awards of future medical care and related
benefits shall only be paid from the fund as the expenses are
incurred. Payments from the fund for future medical care and
related benefits shall not be paid in a lump-sum payment.
[C.] E. Beginning January 1, 2027, any amounts due
from a judgment or settlement against a hospital or outpatient
health care facility shall not be paid from the fund if the
injury or death occurred after December 31, 2026.
[D.] F. This section shall not be construed to
prevent a patient and a health care provider from entering into
a settlement agreement whereby medical care and related
benefits shall be provided for a limited period of time only or
to a limited degree.
G. In a malpractice claim in which punitive damages
are awarded, the court shall divide the punitive damage award
and enter judgment as follows:
(1) twenty-five percent of the punitive damage
award shall be awarded to the prevailing party; and
(2) seventy-five percent of the punitive
damage award shall be awarded to the state. All amounts
awarded to the state shall be remitted to the state treasurer
to be deposited into the patient safety improvement fund.
[E.] H. A judgment of punitive damages against a
health care provider shall be the personal liability of the
health care provider. Punitive damages may only be awarded if
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the prevailing party provides clear and convincing evidence
demonstrating that the acts of the health care provider were
made with deliberate disregard for the rights or safety of
others. Punitive damages shall not be paid from the fund or
from the proceeds of the health care provider's insurance
contract unless the contract expressly provides coverage.
Nothing in Section 41-5-6 NMSA 1978 precludes the award of
punitive damages to a patient. Nothing in this subsection
authorizes the imposition of liability for punitive damages
where that imposition would not be otherwise authorized by law.
I. A punitive damage award shall not exceed an
amount greater than three times the compensatory damage award. "
SECTION 6. Section 41-5-25 NMSA 1978 (being Laws 1992,
Chapter 33, Section 9, as amended) is amended to read:
"41-5-25. PATIENT'S COMPENSATION FUND--THIRD-PARTY
ADMINISTRATOR--ACTUARIAL STUDIES--SURCHARGES--CLAIMS--
PRORATION--PROOFS OF AUTHENTICITY.--
A. The "patient's compensation fund" is created as
a nonreverting fund in the state treasury. The fund consists
of money from surcharges, income from investment of the fund
and any other money deposited to the credit of the fund. The
fund shall be held in trust, deposited in a segregated account
in the state treasury and invested by the state investment
office and shall not become a part of or revert to the general
fund or any other fund of the state. Money from the fund shall
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be expended only for the purposes of and to the extent provided
in the Medical Malpractice Act. All approved expenses of
collecting, protecting and administering the fund, including
purchasing insurance for the fund, shall be paid from the fund.
B. The superintendent shall contract for the
administration and operation of the fund with a qualified,
licensed third-party administrator, selected in consultation
with the advisory board, no later than January 1, 2022. The
third-party administrator shall provide an annual audit of the
fund to the superintendent.
C. The superintendent, as custodian of the fund,
and the third-party administrator shall be notified by the
health care provider or the health care provider's insurer
within thirty days of service on the health care provider of a
complaint asserting a malpractice claim brought in a court in
this state against the health care provider.
D. The superintendent, as custodian of the fund, or
the superintendent's designee, shall evaluate and approve a
proposed settlement if any amount of the proposed settlement is
to be paid from the fund.
[D.] E. The superintendent shall levy an annual
surcharge on all New Mexico health care providers qualifying
under Section 41-5-5 NMSA 1978. The surcharge shall be
determined by the superintendent with the advice of the
advisory board and based on the annual independent actuarial
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study of the fund. The surcharges for health care providers,
including hospitals and outpatient health care facilities whose
qualifications for the fund end on January 1, 2027, shall be
based on sound actuarial principles, using data obtained from
New Mexico claims and loss experience. A hospital or
outpatient health care facility seeking participation in the
fund during the remaining qualifying years shall provide, at a
minimum, the hospital's or outpatient health care facility's
direct and indirect cost information as reported to the federal
centers for medicare and medicaid services for all self-insured
malpractice claims, including claims and paid loss detail, and
the claims and paid loss detail from any professional liability
insurance carriers for each hospital or outpatient health care
facility and each employed health care provider for the past
eight years to the third-party actuary. The same information
shall be available to the advisory board for review, including
financial information and data, and excluding individually
identifying case information, which information shall not be
subject to the Inspection of Public Records Act. The
superintendent, the third-party actuary or the advisory board
shall not use or disclose the information for any purpose other
than to fulfill the duties pursuant to this subsection.
[E.] F. The surcharge shall be collected on the
same basis as premiums by each insurer from the health care
provider. The surcharge shall be due and payable within thirty
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days after the premiums for malpractice liability insurance
have been received by the insurer from the health care provider
in New Mexico. If the surcharge is collected but not paid
timely, the superintendent may suspend the certificate of
authority of the insurer until the annual premium surcharge is
paid.
[F.] G. Surcharges shall be set by October 31 of
each year for the next calendar year. [Beginning in 2021, the
surcharges shall be set with the intention of bringing the fund
to solvency with no projected deficit by December 31, 2026. ]
All qualified and participating hospitals and outpatient health
care facilities shall cure any fund deficit attributable to
hospitals and outpatient health care facilities by December 31,
2026.
[G.] H. If the fund would be exhausted by payment
of all claims allowed during a particular calendar year, then
the amounts paid to each patient and other parties obtaining
judgments shall be prorated, with each such party receiving an
amount equal to the percentage the party's own payment schedule
bears to the total of payment schedules outstanding and payable
by the fund. Any amounts due and unpaid as a result of such
proration shall be paid in the following calendar years.
[H.] I. Upon receipt of one of the proofs of
authenticity listed in this subsection, reflecting a judgment
for damages rendered pursuant to the Medical Malpractice Act,
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the superintendent shall issue or have issued warrants in
accordance with the payment schedule constructed by the court
and made a part of its final judgment. The only claim against
the fund shall be a voucher or other appropriate request by the
superintendent after the superintendent receives:
(1) until January 1, 2022, a certified copy of
a final judgment in excess of two hundred thousand dollars
($200,000) against a health care provider;
(2) until January 1, 2022, a certified copy of
a court-approved settlement or certification of settlement made
prior to initiating suit, signed by both parties, in excess of
two hundred thousand dollars ($200,000) against a health care
provider; or
(3) until January 1, 2022, a certified copy of
a final judgment less than two hundred thousand dollars
($200,000) and an affidavit of a health care provider or its
insurer attesting that payments made pursuant to Subsection B
of Section 41-5-7 NMSA 1978, combined with the monetary
recovery, exceed two hundred thousand dollars ($200,000).
[I.] J. On or after January 1, 2022, the amounts
specified in Paragraphs (1) through (3) of Subsection [H ] I of
this section shall be two hundred fifty thousand dollars
($250,000)."
SECTION 7. A new section of the Medical Malpractice Act
is enacted to read:
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"[NEW MATERIAL] LIMITING ATTORNEY FEES.--An attorney shall
not contract for or collect a contingency fee for representing
a person seeking damages in a malpractice claim in an amount
that exceeds:
A. twenty-five percent of the dollar amount
recovered, if the recovery is pursuant to a settlement
agreement and release of all claims executed by all parties
prior to the start of a trial or an arbitration proceeding; or
B. thirty-three percent of the dollar amount
recovered, if the recovery is pursuant to settlement,
arbitration or judgment that occurs after a trial or
arbitration proceeding begins."
SECTION 8. A new section of the Medical Malpractice Act
is enacted to read:
"[NEW MATERIAL] PATIENT SAFETY IMPROVEMENT FUND--
CREATED.--
A. The "patient safety improvement fund" is created
in the state treasury and shall be administered by the
department of health. The patient safety improvement fund
consists of distributions, appropriations, gifts, grants,
donations and receipts of punitive damage awards from medical
malpractice claims. Money in the patient safety improvement
fund shall be invested by the state treasurer, and income from
investment of the patient safety improvement fund shall be
credited to the patient safety improvement fund. Money in the
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patient safety improvement fund shall be expended only as
provided in this section.
B. Money in the patient safety improvement fund is
subject to appropriation by the legislature to the department
of health for the purposes of improving patient safety and
health care outcomes. All payments made from the patient
safety improvement fund shall be made by warrant of the
secretary of finance and administration pursuant to vouchers
signed by the secretary of health or the secretary's authorized
representative. Any unexpended or unencumbered balance
remaining in the patient safety improvement fund at the end of
a fiscal year shall not revert but shall remain to the credit
of the patient safety improvement fund."
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