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News Release

New Jersey Department of
Banking and Insurance

Commissioner Steven M. Goldman

For Immediate Release:
October 18, 2006

For Further Information:
Jim Gardner (609) 292-5064

Medical Malpractice Liability Insurance Subsidy Payments Are In the Mail

TRENTON – New Jersey Banking and Insurance Commissioner Steven M. Goldman today announced that subsidies are being distributed to eligible medical practitioners in certain high-risk specialties as part of an ongoing effort to protect access to medical care for New Jersey residents.

The subsidy payments, more than $15.7 million to 1,272 physicians, implement an important section of the New Jersey Medical Care Access and Responsibility and Patients First Act of 2004. The act – P.L. 2004, c. 17, sponsored by Assembly members Roberts, Cohen, Weinberg and McKeon and Senators Vitale and Lesniak – seeks to ensure affordable medical care for New Jersey residents in part by offering assistance in the payment of medical malpractice insurance premiums for physicians in certain high-risk specialties.

Practitioners and healthcare providers in the following medical specialties and subspecialties were eligible to apply for a subsidy from the Medical Malpractice Liability Insurance Premium Assistance Fund (MMLIPA) to be distributed this month:

  • Obstetric/gynecology (practices otherwise limited to gynecology alone are excluded);
  • Neurosurgery; and
  • Diagnostic radiology (limited to radiologists who read mammograms. The radiologist must be a New Jersey board certified or board eligible radiologist and be certified as meeting the requirements under the Federal Mammography Quality Standards Act and regulations).

Payment amounts are based on the average expenditures for medical malpractice liability insurance among physicians in the eligible specialties. Qualified neurosurgeons will each receive $17,821; obstetric/gynecologists will each receive $16,006; and diagnostic radiologists will receive $5,753. This distribution achieves a proportionate share of the fund. Physicians receiving payments agree to practice in the state for at least two years.

“We are seeing more stability in the market as we enter the second year of a three-year program,” said Commissioner Goldman. “The MMLIPA subsidy is one of the key components of the medical malpractice insurance reform legislation.” Physicians who were not eligible for the subsidy in the last two years will be included in the review next year and some of those practitioners may be found to be eligible.

The fund is made possible through an assessment on state licensed physicians, lawyers, employers subject to the state’s unemployment compensation law, and other medical professionals, with 65 percent of the fund dedicated to premium relief. The remainder is earmarked for hospital Charity Care, NJ FamilyCare, and student loan reimbursement for obstetricians and gynecologists committed to practicing in the state.

This past summer, the Department of Banking and Insurance accepted applications from practitioners who are eligible for the MMLIPA subsidy. The department worked in consultation with the New Jersey Department of Health and Senior Services in determining which medical specialties and subspecialties were eligible for assistance this year.