Opinion ID: 1864418
Heading Depth: 1
Heading Rank: 2

Heading: law and arguments

Text: LSA-R.S. 40:1299.42(A) contains the following language: § 1299.42. Limitation of recovery A. To be qualified under the provisions of this Part [Part XXIII. Medical Malpractice Act], a health care provider shall: (1) Cause to be filed with the commissioner proof of financial responsibility as provided by Subsection E of this Section; (2) Pay the surcharge assessed by this Part on all health care providers according to R.S. 40:1299.44; and (3) For self-insureds, qualification shall be effective upon acceptance of proof of financial responsibility by and payment of the surcharge to the commissioner of insurance. Qualification shall be effective for all others at the time the malpractice insurer accepts payment of the surcharge. (emphasis added) Thus, to qualify, a health care provider must file the type of proof of financial responsibility described in Subsection E and pay the annual PCF surcharge levied on the health care provider according to Section 1299.44. [11] For self-insureds, qualification under the Medical Malpractice Act shall then be effective upon the commissioner's acceptance of the proof of financial responsibility and his receipt of payment of the surcharge. For health care providers other than self-insureds, qualification under the Medical Malpractice Act shall be effective at the time the malpractice insurer accepts payment of the surcharge. § 1299.42(A)(3). For amplification on the proof of financial responsibility a health care provider must file with the commissioner in order to qualify under the Medical Malpractice Act, Subsection A(1) references Subsection E. That Subsection then describes the proof as follows: E. Financial responsibility of a health care provider under this Section [§ 40:1299.42. Limitation of recovery] may be established only by filing with the commissioner proof that the health care provider is insured by a policy of malpractice liability insurance in the amount of at least one hundred thousand dollars per claim with qualification under this Section taking effect and covering the same period and following the same form as the policy of malpractice liability insurance of the health care provider or, in the event the health care provider is self-insured, proof of fianancial responsibility in excess of one hundred thousand dollars. LSA-R.S. 40:1299.42(E). (emphasis added) By its clear language, Subsection E describes the exclusive methods by which the health care provider's financial responsibility may be established. Cf. LSA-C.C. art. 11. The use of the term Section in Subsection E, instead of the term Part, clarifies that the Subsection is used merely as a descriptive statement, a means of expressing what is denoted by the phrase proof of financial responsibility. Subsection E merely sets forth the requirements needed to satisfy Subsection A(1). When Act 435 of 1984 added the phrase with qualification under this Section taking effect and covering the same period and following the same form as the policy of malpractice liability insurance of the health care provider, the amending language did not alter or modify the dictates of Subsection A(3). Qualification under the Medical Malpractice Act for health care providers other than self-insureds continues to be effective at the time the malpractice insurer accepts payment of the (initial PCF) surcharge. Subsection E, as amended, alerts those health care providers their proof of financial responsibility and, hence, their qualification under § 1299.42, is effective only for the same period and following the same form as their filed policy of malpractice liability insurance. For example, if the health care provider pays the PCF surcharge for the period August 1, 1989 through August 1, 1990, but the claims-made malpractice liability insurance policy which he has caused to be filed with the commissioner becomes effective on September 1, 1989 but expires on January 1, 1990, Subsection E declares the health care provider has failed to establish proof of his financial responsibility for the entire period covered by the PCF surcharge. For the periods August 1, 1989 through August 31, 1989 and January 1, 1990 through August 1, 1990, the health care provider is not qualified, despite the payment of the PCF surcharge. The 1984 amendment to Subsection E clarified that mere payment of the annual surcharge and filing a malpractice liability insurance policy which pays $100,000 per claim is insufficient for PCF coverage. Any lapse in the malpractice liability insurance policy filed as proof of financial responsibility, through either its effective period or its form (occurrence or claimsmade), renders the health care provider unqualified during the period of the lapse. Cf. LSA-R.S. 40:1299.45(A)(1); 40:1299.41(D). [12] Nevertheless, defendants' primary argument is the legislature amended Subsection E in 1984 in direct response to the decisions of Williams and Mehalik. Defendants claim those two decisions rely upon the language of Subsection A as their sole basis for holding, where health care providers have not paid the PCF surcharge prior to the occurrence of the alleged tort, the tortious conduct is not covered by the Act and plaintiffs can file suit under general tort law and procedure. Thus, by its amendment of Subsection E, defendants claim the legislature intended to change the law so Subsection A would govern only the method by which a health care provider becomes qualified, while the amended Subsection E would govern the period of coverage after the qualification has occurred. They assert this intent is evidenced by the legislature's passage of the amendment within weeks of the Fourth Circuit's decision in Mehalik. The history of Act 435 of 1984, however, does not accord with defendants' views. Act 435 of 1984 was introduced in the legislature as Senate Bill No. 1110. The bill sought to amend numerous sections of the Medical Malpractice Act. After passage in the Senate it was amended by the House and returned to the Senate for concurrence in the amendments. Following enactment, it was presented to the Governor on July 5, 1984 for his signature. The First Circuit had denied rehearing in Williams on October 22, 1982 and this court denied writs on December 20, 1982. No action was taken by the 1983 legislature in response to the Williams decision. Mehalik was not handed down by the Fourth Circuit until June 26, 1984, the day after the House had amended Senate Bill No. 1110 and returned it to the Senate for concurrence. This sequence of events does not, as defendants suggest, incontrovertibly evince a legislative intent to overrule Williams and Mehalik. Defendants also contend Subsection E was amended to reflect the insurance industry's change to issuing as the standard policy claims-made policies, instead of occurrence policies. Occurrence policies insure only those claims which occur during the effective period of the policy. With those policies, coverage problems developed when the time of the negligent act could not be determined with exactitude. Defendants assert the industry's solution for the problem was to develop claimsmade policies which insure claims filed within the effective period of the policy as long as the claims arise from acts or omissions which occur during the policy's effective period or during the policy's specified retroactive period. This argument and its interpretation of Act 435, however, leads to absurd and possibly unconstitutional consequences. The PCF is funded by surcharges levied annually upon the QHCPs. Under the theory propounded by defendants, a QHCP whose financial responsibility is established by a claims-made policy is given heightened treatment compared to other QHCPs. Unlike the self-insured QHCPs or the QHCPs with occurrence policies, under defendants' theory the claims-made QHCPs are entitled to PCF coverage for periods during which they had not paid or qualified, merely because their contract with a third-party insurer provides for retroactive coverage. This theory is repugnant to the interests of the fund as well as to tort victims who must rely upon the fund for compensation. It would expose the fund to tort claims arising from periods for which it had not received surcharge payments. It would also increase the possibilities of the fund being diminished or exhausted during the semi-annual period in which claims became final, resulting in claims of tort victims not being honored when they came due. See LSA-R.S. 40:1299.44. Furthermore, even though it is our rule of long-standing to refrain from considering constitutional issues unless a determination is necessary for the resolution of the litigant's present rights, we observe that defendants' interpretation appears not to harmonize with our constitution. See Everett v. Goldman, 359 So.2d 1256 (La. 1978). First, the 1984 amendment as defendants would interpret it, could violate malpractice victims' equal protection rights by allowing tortfeasors who have become potential malpractice defendants to control how they would be sued. See Id. [13] Second, because defendants' interpretation might make the 1984 amendment unreasonable in relation to the goal the Medical Malpractice Act seeks to attain and might show the amendment was not adopted in the interest of the community as a whole, such an interpretation suggests violation of the malpractice victims' due process rights. See Id. Third, defendants' interpretation might violate the State constitutional proscription against special laws. LSA-Const. Art. 3, § 12(A)(7). [14] A statute is a special law if it affects only a certain number of persons within a class and not all persons possessing the characteristics of the class. Davenport v. Hardy, 349 So.2d 858 (La. 1977); Teachers' Retirement System of Louisiana v. Vial, 317 So.2d 179 (La.1975). Consequently, as defendants' interpretation does not operate equally and uniformly upon all QHCPs or on all tort victims of health care providers or of QHCPs, it might unconstitutionally allow certain health care provider tortfeasors to dictate how they would be sued. Finally, defendants' interpretation, when combined with a claims-made policy with a retroactive date which covers periods prior to July 5, 1984 (the effective date of the 1984 amendment), may result in violation of the vested property rights of tort victims in contravention of their due process guaranties. See Faucheaux v. Alton Ochsner Medical Foundation Hospital and Clinic, 470 So.2d 878 (La.1985) [when plaintiff's injury happened, he acquired a cause of action in strict liability under LSA-C.C. art. 2315 which is a vested property right protected by the guarantee of due process]; Lott v. Haley, 370 So.2d 521 (La.1979); Burmaster v. Gravity Drainage District No. 2, 366 So.2d 1381 (La. 1978). Thus, were Subsection E susceptible to the construction urged by defendants, constitutionality is suspect for several reasons. The interpretation we adopt in this opinion obviates a definitive ruling on the constitutionality of the amended subsection. This comports with our duty to interpret the statute so as to render it operative when it is possible to do so and avoid striking it on constitutional grounds. Tanner v. Beverly Country Club, 47 So.2d 905, 217 La. 1043 (1950); Conley v. City of Shreveport, 43 So.2d 223, 216 La. 78 (1949); State v. Wiggins, 438 So.2d 565 (La.1983) (Dennis, J. concurring); Dudoussat v. Louisiana State Racing Com'n, 133 So.2d 155 (La. App. 4th Cir. 1961). See also, Concerned Bus. & Prop. Owners of DeSoto, Inc. v. DeSoto Parish School Bd., 531 So.2d 436, 443 (La. 1988) [An unconstitutional act which purports to amend a prior constitutional statute cannot accomplish that objective. The unconstitutional act, having no effect, can amend nothing. Instead, the applicable law is provided by the statute as worded prior to the unconstitutional amendment.].