A Pennsylvania Commonwealth Court recently ruled the state’s insurance commissioner must recalculate how much medical providers must pay into a state-managed fund that helps cover the cost of damage awards in medical malpractice cases.

The Medical Care Availability and Reduction of Error fund, MCARE, was initially established to help control medical malpractice insurance costs. In addition to purchasing private malpractice insurance, healthcare providers must also pay into MCARE.

Assessments for how much providers must contribute are based on several factors, including medical specialty and the geographic areas served.

The Pennsylvania Medical Society, the Hospital & Healthsystem Association of Pennsylvania and the Pennsylvania Podiatric Medical Association petitioned the Commonwealth Court for payment reductions, claiming that their members had been significantly over-charged to support the fund from 2009 to 2011.  

The medical associations claimed state officials did not properly calculate assessments and neglected to include carryover balances in the fund, which significantly increased the amount medical providers were required to contribute to MCARE during those years.

For example a 2008 carryover balance of $104 million was not included in calculations for 2009 MCARE payments. That year participants paid more than $204 million into the fund.

The Court ruled in favor of recalculating MCARE assessments for the years 2009 through 2011. The total dollar amount overpaid and how it will be awarded back to practitioners still need to be determined.