The Maryland General Assembly approved a medical malpractice overhaul package early today aimed at cutting doctors' skyrocketing insurance costs, but Gov. Robert Ehrlich said he would veto it because it includes a tax on HMO premiums.
In a meeting that stretched 17 hours, until around 3:30 a.m., the bill got final approval in the Senate in a 32-13 vote. Earlier, the House had approved it 85-44.
The governor summoned lawmakers to Annapolis on Tuesday for a special session to deal with malpractice costs, which he said was the most important issue facing the state. Doctors face a Friday deadline for paying their 2005 premiums.
Ehrlich proposed strict restrictions on malpractice lawsuits, arguing that frivolous suits and excessive awards had driven up the cost of insurance to the point that some doctors were shutting down their practices.
But the bill developed by House and Senate negotiators also would apply a 2% percent tax on HMO premiums, adamantly opposed by Ehrlich. The proceeds from the tax would be used to underwrite the cost of malpractice insurance and increase Medicaid reimbursements to doctors in specialties such as obstetrics, where malpractice costs have been particularly high.
Ehrlich said late Wednesday that the "net result of this exercise is a tax bill," which he said is unacceptable. He vowed to introduce his own bill, without the tax increase, when the 2005 legislative session beings Jan. 12.
"We didn't call these folks into special session so they could pass a regressive tax that will be passed on to those who can least afford to pay it," the governor said.
The governor and legislators have been negotiating for weeks trying to work out an agreement that could be put in place before Dec. 31, the last date for doctors to pay premiums for next year.
Average premiums have increased more than 60% the last two years, and premiums in high-risk specialties have gone up even faster.