RS H.B. 1170 75(R)BILL ANALYSIS


INSURANCE
H.B. 1170
By: Smithee
3-17-97
Committee Report (Amended)



BACKGROUND 

Currently the Texas Insurance Code prohibits not-for-profit 
nursing homes from purchasing 
punitive damage insurance coverage under medical professional 
liability insurance from an 
admitted carrier.  Not-for-profits may purchase such insurance 
from non-admitted, out-of-state 
carriers, but these policies would not include oversight and 
protections under the Texas 
Department of Insurance. The current law reflects a time when the 
not-for-profits were less 
concerned about litigation than today.      

PURPOSE

As proposed, H.B. 1170 would include a not-for-profit nursing 
home under the definition of a 
hospital as described in Section 8, Article 5.15-1, Insurance 
Code.  

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly 
grant any additional rulemaking 
authority to a state officer, department, agency or institution.

SECTION BY SECTION ANALYSIS

SECTION 1. - Amends Section 8 of Article 5.15-1, Insurance Code, 
to read as follows:

(8) PUNITIVE DAMAGES UNDER MEDICAL PROFESSIONAL LIABILITY 
INSURANCE

Defines term "hospital" as definition mentioned previously in 
article.  Adds "not-for-profit 
nursing home" to definition of what may receive an endorsement 
form for insurance coverage 
for punitive damages on a policy of medical liability 
insurance.

SECTION 2. - Effective Date, September 1, 1997, and applies to 
policies enacted or renewed 
after January 1, 1998.

SECTION 3. - Emergency Clause.

EXPLANATION OF AMENDMENTS

Committee Amendment 1. - by Lewis, Glenn
Updates language in bill to reflect "commissioner" instead of