CAT Fund remains bitter pill to swallow for doctor
Doctors winners in this region
Geography appears to be a factor in Pennsylvania's malpractice cases.
It's not because he's incompetent. He said he's seen 400,000 patients in 30 years as a physician and has never once been sued for medical malpractice.
Whiteford's medical career ended in 1996 because he refused to pay an annual mandatory fee to the state's Medical Professional Liability Catastrophe Loss Fund.
'I refuse to pay it,' he said. 'I will not practice medicine again if I have to pay for the medical errors of a doctor I don't know who lives in a city I can't name.'
Whiteford is one of a small group of Pennsylvania physicians who have lost their licenses or seen them suspended because they refused to pay the annual CAT fund surcharge. In Whiteford's case, the fee was $5,816.
The state requires all physicians to pay the surcharge for additional malpractice insurance that covers settlements and awards that exceed the limits of a doctor's primary coverage.
The CAT fund was created in 1975 after two major malpractice insurance carriers stopped doing business in Pennsylvania and other companies threatened to do the same. It was designed to provide reasonably priced malpractice insurance to pay claims against physicians when malpractice awards exceeded their basic coverage.
The CAT fund has more than $2 billion in unfunded liability now because it does not have a reserve to cover future losses, unlike insurance companies. Annual surcharges are based on claims paid in the previous 12-month period; this year the surcharge is 61 percent of a physician's premium for basic coverage.
John Reed, executive director of the CAT fund since 1994, said less money was collected in surcharges last year than in 1999. Physicians, he said, are dragging their feet in paying the money.
'We have a tough time collecting money from these guys. It takes time to catch up with them,' Reed said.
After 32 years as a doctor and owner of a Murrysville clinic, Whiteford claims the CAT fund forces good physicians to pay for the mistakes of bad ones.
'There's no reason for a competent physician to lose his license because another physician is incompetent,' he said.
Whiteford worked as an engineer before he became a doctor. Now 60, he's trying to make a living again as an engineer while he pursues a legal fight against the CAT fund.
The battle began in 1995 when he refused to pay the surcharge. He appealed to the Bureau of Occupational Affairs, which revoked his license the following year. He lost an appeal to the Board of Medicine and then filed a lawsuit against the state in Commonwealth Court, where it was dismissed.
Whiteford then appealed to the state Supreme Court, which refused to hear his case. A subsequent lawsuit filed in U.S. District Court in Pittsburgh was dismissed. He appealed to the U.S. Third Circuit Court of Appeals in Philadelphia, which remanded the case to the U.S. District Court for a hearing that resulted in another dismissal.
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He's acted as his own attorney in all the legal actions.
'I don't like the way I got kicked out of medicine,' Whiteford said. 'I can't believe they did it. I'm offended that you can lose a license so easily that was so hard to get.'
Across the state, Dr. Louis Meier of Norristown lost his license in 1997 because he refused to pay the surcharge. After 28 years as a surgeon, Meier was winding down his practice and said he couldn't afford to pay more than $33,000 in premiums - which included an $11,000 surcharge. He said he cleared only $36,746 the previous year.
Failure to pay forced him into retirement sooner than he had planned.
Meier, 70, also has been battling the CAT fund since 1996 when he filed a lawsuit in U.S. District Court in Philadelphia arguing the surcharge was unconstitutional. He lost.
Meier continued to practice medicine while he appealed the revocation, but the state charged him with practicing medicine without a license and fined him $7,000.
After working as an engineer, Whiteford went to medical school, graduated in 1968, served as a Navy physician and eventually became director of emergency services at Shadyside Hospital in Pittsburgh.
He opened a medical clinic in Murrysville in 1979 and practiced there until he lost his license in 1996.
'I will never pay another penny to the CAT fund and I will never pay another penny for malpractice insurance,' he said. 'I'm an entirely capable physician ... but I will not practice in a system that is driving capable people out of medicine.'
Whiteford and Meier charged that the CAT fund is 'very corrupt' and has been mismanaged.
In 1992, the state Inspector General's Office investigated allegations against the CAT fund.
The investigation found instances of waste and mismanagement and revealed that the former director, Joseph Pulcini Jr., abused his position by arriving late for work and leaving early so he could attend law school.
The IG also discovered Pulcini accepted gifts from people and played golf with officials of insurance companies who did business with the fund, which was a conflict of interest, the report said.
Pulcini was disciplined, according to the report. He later left the job.
Reed, who replaced him, said operation of the fund has improved and it is wrong to lay blame for malpractice insurance rates at the feet of the CAT fund.
'A lot of people have been spouting off and don't necessarily know what they're talking about,' Reed said. 'I'm not denying we have a problem. I'm the guy who brought the problem to the public's attention.'
Some critics of the CAT fund in the state's medical community believe Pennsylvania should adopt a plan similar to California's.
In California, the Medical Injury Compensation Reform Act established a way to limit malpractice premiums, attorney fees and jury awards short of having to file a lawsuit.
MICRA requires a potential plaintiff to notify a physician three months before filing a lawsuit so the two sides can work out a medical or financial solution short of litigation. It also established a system to report doctors who are successfully sued or who have settled malpractice cases to a Board of Medical Quality Assurance so doctors can be investigated for competency.
Doctors winners in this region Geography appears to be a factor in Pennsylvania's malpractice cases.