The malpractice fund is stable, doctor
This week at the MacIver Institute I took note how the medical malpractice fund has stabilized under Governor Scott Walker. The fund actually showed a negative balance under Governor Jim Doyle after he raided it in 2007.
According to a recent report by the Legislative Audit Bureau, “The Fund’s financial position also has been significantly affected over the last five years by a $200 million transfer from the Fund to the State’s Medical Assistance Trust Fund required by 2007 Wisconsin Act 20.
“Largely due to the $200 million transfer, the Fund’s net asset balance declined 215.5 percent from $94.4 million as of June 30, 2007, to -$109.0 million as of June 30, 2009.”
So because of Doyle’s budgeting, the fund actually moved from a positive balance to a negative balance of over $100 million. This put injured medical patients at risk, as well as medical malpractice insurance costs. Poor budgeting is not compassionate budgeting.
Thanks to the budget reforms put in place by Walker when he took office, including the implementation of Act 10, Wisconsin was able to put the fiscal house in order. That meant the state was able to pay back the money owed to the medical malpractice compensation fund before additional penalties accrued.
In August 2011, the state paid $233.7 million from the general fund to the malpractice fund. As of June 30th, 2012, the Fund’s net asset balance was $361.3 million. The state was even able to fix the past wrongs and now the fund’s financial position has “improved significantly” over the last three years, according to the Legislative Audit Bureau.