Maryland Task Force Gives Green Light to No-Fault Birth Injury Fund

A Maryland task force has recommended that the state implements a no-fault birth injury fund to compensate families with children who suffered serious trauma during delivery.

While proponents of the fund claim it will help more injured children and their parents receive financial assistance to get the care they need, opponents argue the fund would prevent families from holding negligent doctors accountable and restrict the amount of financial help available.

Virginia and Florida models

The Maryland no-fault fund would be modeled after those currently in effect in Virginia and Florida. The fund would be financed by hospitals and insurance companies based on a rate-setting system. Supporters say it would ensure more children get the care they need while preserving obstetrical practices concerned about the high cost of malpractice insurance and lawsuits.

This is the second task force to make such a recommendation in as many years. Last year’s task force was comprised entirely of members of the healthcare community. This year’s task force includes members of the insurance industry as well as legal representatives. However, not every member of the task force was on board with the recommendation.

One of the representatives from the insurance sector, Medical Mutual, voiced concern about a funding mechanism for the system. Because that was not specified in the plan, this insurer abstained from voting in favor of the plan.

The trial lawyer association Maryland Association for Justice also refrained from voting for the plan, stating the fund could be too costly. The organization also stated the necessity of the fund was unclear, since there are ample physicians in Maryland to provide obstetrical care. Currently, the medical malpractice insurance industry is also stable in the state, negating the need for a no-fault fund.

Bill introduced last year falls flat

Last year, the recommendation for a fund became an actual bill introduced to state legislators by Sen. Catherine Pugh and 22 House delegates. That bill would have established a fund paid for by hospitals and would finance care for a child born with a neurological problem due to a birth injury. Hospitals would have paid $25 million into the fund, which would have been sufficient based on actuary estimates that only around seven babies would qualify for a portion of the fund each year.

Legal representatives opposed to the bill stated the estimate of seven babies per year in need of funding was actually much too low. In fact, Maryland could see as many as 150 birth injuries annually, which would be many more than this funding model could handle.

The bill failed to pass the General Assembly this year, but the new recommendation was made in time for a new debate in the 2016 General Assembly session. The Baltimore Business Journal reports that new health statistics for the state, including an uptick in infant deaths in 2013, may fuel the new recommendation as well. In addition, the state has seen some reduction in obstetric services, although it is impossible to determine whether that decline was related in any way to medical malpractice insurance rates.

Advocates of the fund told the Baltimore Business Journal the push to move the fund through the General Assembly will be even more powerful this time around. However, opposition to the fund from legal and insurance representatives could thwart their efforts once again in 2016.

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