I 
109TH CONGRESS 
1ST SESSION H. R. 2291 
To amend the Internal Revenue Code of 1986 to allow a business credit 
for qualified expenditures for medical professional malpractice insurance. 
IN THE HOUSE OF REPRESENTATIVES 
MAY 11, 2005 
Ms. HERSETH (for herself, Mr. JEFFERSON, Mr. SNYDER, Ms. BERKLEY, Mr. 
HIGGINS, Mr. NADLER, Mr. BOUCHER, Mr. MOORE of Kansas, Mr. 
ISRAEL, Mr. LEWIS of Georgia, Mr. BAIRD, Mr. ROSS, Mr. GENE GREEN 
of Texas, Mr. HONDA, Mr. BERRY, Mr. BOSWELL, Mr. CLAY, Mr. GON-
ZALEZ, Ms. KAPTUR, Mr. REYES, Mr. RUPPERSBERGER, Mr. HINOJOSA, 
Mr. DAVIS of Alabama, Mr. THOMPSON of California, Mr. CROWLEY, Mr. 
MEEKS of New York, and Mr. BISHOP of New York) introduced the fol-
lowing bill; which was referred to the Committee on Ways and Means, 
and in addition to the Committee on Energy and Commerce, for a period 
to be subsequently determined by the Speaker, in each case for consider-
ation of such provisions as fall within the jurisdiction of the committee 
concerned 
A BILL 
To amend the Internal Revenue Code of 1986 to allow a 
business credit for qualified expenditures for medical pro-
fessional malpractice insurance. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Medical Malpractice 
Relief Act of 2005’’.
SEC. 2. CREDIT FOR QUALIFIED EXPENDITURES FOR MED-
ICAL PROFESSIONAL MALPRACTICE INSUR-
ANCE. 
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
1986 (relating to business tax credits) is amended by add-
ing at the end the following: 
‘‘SEC. 45J. CREDIT FOR EXPENDITURES FOR MEDICAL PRO-
FESSIONAL MALPRACTICE INSURANCE. 
‘‘(a) GENERAL RULE.—For purposes of section 38, 
in the case of an eligible person, the medical malpractice 
insurance expenditure tax credit determined under this 
section for a taxable year is the amount equal to the appli-
cable percentage of qualified medical malpractice insur-
ance expenditures. 
‘‘(b) LIMITATION.— 
‘‘(1) IN
GENERAL.—The amount of qualified 
medical malpractice insurance expenditures taken 
into account under subsection (a) for a taxable year 
with respect to an eligible person shall not exceed 
the amount equal to twice the average of costs of 
qualified medical malpractice insurance for similarly 
situated eligible persons. 
‘‘(2) AVERAGE COSTS.—For purposes of para-
graph (1), the Secretary of Health and Human 
Services, after consultation with State boards of
medical licensure and State boards (or agencies) reg-
ulating insurance, shall— 
‘‘(A) determine average costs (rounded to 
the nearest whole dollar) of providing or fur-
nishing general medical malpractice liability in-
surance to eligible persons, and 
‘‘(B) certify the amount of such costs to 
the Secretary on or before the 15th day of No-
vember of each year. 
‘‘(c) DEFINITIONS AND SPECIAL RULE.—For pur-
poses of this section— 
‘‘(1) QUALIFIED MEDICAL MALPRACTICE INSUR-
ANCE EXPENDITURE.— 
‘‘(A) IN
GENERAL.—The term ‘qualified 
medical 
malpractice 
insurance 
expenditure’ 
means so much of any professional insurance 
premium, surcharge, payment, or other cost or 
expense which is paid or incurred in the taxable 
year by an eligible person for the sole purpose 
of providing or furnishing general medical mal-
practice liability insurance for such eligible per-
son. 
‘‘(2) ELIGIBLE
PERSON.—The term ‘eligible 
person’ means—
‘‘(A) any physician (as defined in section 
213(d)(4)) who practices in any surgical spe-
cialty or subspecialty, emergency medicine, ob-
stetrics, anesthesiology or who does intervention 
work which is reflected in medical malpractice 
insurance expenditures, 
‘‘(B) any physician (as so defined) who 
practices in general medicine, allergy, derma-
tology, pathology, or any other specialty not 
otherwise described in this section, and 
‘‘(C) any hospital, clinic, or long-term care 
provider, 
which meets applicable legal requirements to provide 
the health care services involved. 
‘‘(3) APPLICABLE PERCENTAGE.—The applica-
ble percentage is— 
‘‘(A) 30 percent in the case of a person de-
scribed in paragraph (2)(A), and 
‘‘(B) 20 percent in the case of a person de-
scribed in subparagraph (B) or (C) of para-
graph (2). 
‘‘(4) SIMILARLY SITUATED.—The determination 
of whether persons are similarly situated shall be 
made on the basis of medical practices primarily lo-
cated within a statistical area (as defined in section
142(k)(2)) and shall differentiate between specialty 
and subspecialty medical practices. 
‘‘(d) ELECTION NOT TO CLAIM CREDIT.—This sec-
tion shall not apply to a taxpayer for any taxable year 
if such taxpayer elects to have this section not apply for 
such taxable year. 
‘‘(e) TERMINATION.—This section shall not apply to 
taxable years beginning after December 31, 2006.’’. 
(b) CREDIT MADE PART OF GENERAL BUSINESS 
CREDIT.—Section 38(b) of such Code (relating to current 
year business credit) is amended by striking ‘‘plus’’ at the 
end of paragraph (18), by striking the period at the end 
of paragraph (19) and inserting ‘‘, plus’’, and by adding 
at the end the following new paragraph: 
‘‘(20) the medical malpractice insurance ex-
penditure tax credit determined under section 
45J(a).’’. 
(c) DENIAL OF DOUBLE BENEFIT.—Section 280C of 
such Code (relating to certain expenses for which credits 
are allowable) is amended by adding at the end the fol-
lowing new subsection: 
‘‘(e) CREDIT FOR MEDICAL MALPRACTICE LIABILITY 
INSURANCE PREMIUMS.— 
‘‘(1) IN GENERAL.—No deduction shall be al-
lowed for that portion of the qualified medical mal-
practice insurance expenditures otherwise allowable 
as a deduction for the taxable year which is equal 
to the amount of the credit allowable for the taxable 
year under section 45J (determined without regard 
to section 38(c)). 
‘‘(2) CONTROLLED GROUPS.—In the case of a 
corporation which is a member of a controlled group 
of corporations (within the meaning of section 
41(f)(5)) or a trade or business which is treated as 
being under common control with other trades or 
business 
(within 
the 
meaning 
of 
section 
41(f)(1)(B)), this subsection shall be applied under 
rules prescribed by the Secretary similar to the rules 
applicable under subparagraphs (A) and (B) of sec-
tion 41(f)(1).’’. 
(d) GRANTS TO NON-PROFIT HOSPITALS, CLINICS, 
AND LONG-TERM CARE PROVIDERS.— 
(1) IN GENERAL.—The Secretary of Health and 
Human Services, acting through the Administrator 
of the Health Resources and Services Administra-
tion, shall award grants to eligible non-profit hos-
pitals, clinics, and long-term care providers to assist 
such hospitals, clinics, and long-term care providers 
in defraying qualified medical malpractice insurance 
expenditures.