S 1469 General Bill, By Hutto, Hawkins and Cleary
 A BILL TO AMEND TITLE 15, CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING
 CHAPTER 80, SO AS TO ESTABLISH THE "SOUTH CAROLINA BIRTH-RELATED NEUROLOGICAL
 INJURY COMPENSATION PROGRAM" PROVIDING FOR COMPENSATION ON A NO-FAULT BASIS
 FOR BIRTH-RELATED NEUROLOGICAL INJURIES, PROCEDURES FOR FILING OF CLAIMS
 BEFORE THE ADMINISTRATOR OF THE SOUTH CAROLINA BIRTH-RELATED NEUROLOGICAL
 INJURY COMPENSATION PROGRAM, PROCEDURES FOR DETERMINING CLAIMS BY THE
 ADMINISTRATOR, PROCEDURES FOR DETERMINING CLAIMS ON APPEAL TO THE
 ADMINISTRATIVE LAW COURT, PROCEDURES FOR ASSESSMENTS OF THE PROGRAM, AND
 PROCEDURES FOR THE BOARD OF DIRECTORS OF THE PROGRAM.

   06/01/06  Senate Introduced and read first time SJ-10
   06/01/06  Senate Referred to Committee on Judiciary SJ-10

TO AMEND TITLE 15, CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING CHAPTER 80, SO AS TO ESTABLISH THE "SOUTH CAROLINA BIRTH-RELATED NEUROLOGICAL INJURY COMPENSATION PROGRAM" PROVIDING FOR COMPENSATION ON A NO-FAULT BASIS FOR BIRTH-RELATED NEUROLOGICAL INJURIES, PROCEDURES FOR FILING OF CLAIMS BEFORE THE ADMINISTRATOR OF THE SOUTH CAROLINA BIRTH-RELATED NEUROLOGICAL INJURY COMPENSATION PROGRAM, PROCEDURES FOR DETERMINING CLAIMS BY THE ADMINISTRATOR, PROCEDURES FOR DETERMINING CLAIMS ON APPEAL TO THE ADMINISTRATIVE LAW COURT, PROCEDURES FOR ASSESSMENTS OF THE PROGRAM, AND PROCEDURES FOR THE BOARD OF DIRECTORS OF THE PROGRAM.

Be it enacted by the General Assembly of the State of South Carolina:

SECTION    1.    Title 15 of the 1976 Code is amended by adding:

Section 15-80-100.        This chapter may be cited as the "South Carolina Birth-Related Neurological Injury Compensation Program Act".

Section 15-80-110.    (A)    The legislature makes the following findings:

(1)    Physicians practicing obstetrics are high-risk medical specialists for whom malpractice insurance premiums are very costly, and recent increases in these premiums have been greater for such physicians than for other physicians.

(2)    Any birth other than a normal birth frequently leads to a claim against the attending physician; consequently, these physicians are among the physicians most severely affected by current medical malpractice problems.

(3)    Because obstetric services are essential, it is incumbent upon the legislature to provide a plan designed to result in the stabilization and reduction of malpractice insurance premiums for providers of these services in South Carolina.

(4)    The costs of birth-related neurological injury claims are particularly high and warrant the establishment of a limited system of compensation irrespective of fault. The issue of whether such claims are covered by this act must be determined exclusively in an administrative proceeding.

(B)    It is the intent of the legislature to provide compensation, on a no-fault basis, for a limited class of catastrophic injuries that result in unusually high costs for custodial care and rehabilitation. This plan shall apply only to birth-related neurological injuries.

Section 15-80-120.    (A)    For purposes of this chapter:

(1)    A 'birth-related neurological injury' means a non-progressive impairment of the brain or spinal cord which occurred or which could have occurred during pregnancy, during labor, during delivery or in the immediate resuscitation period after delivery which results in a significant impairment in central nervous system function rendering the infant substantially handicapped. Infants who are substantially handicapped will achieve a score on a standardized neurological impairment scale which, in the judgment of a review panel, documents such a substantial degree of handicap. This definition applies to live births only and shall not include disability caused by congenital abnormalities including, but not limited to, genetic, development, or teratogenic causes.

(2)    'South Carolina Birth-Related Neurological Injury Compensation Fund' means the South Carolina Birth-Related Neurological Injury Compensation Fund established in Section 15-80-130(A) administered by the South Carolina Birth-Related Neurological Injury Compensation Program according to the plan of operation established in Section 15-80-230.

(3)    'Claimant' means any person who files a claim pursuant to Section 15-80-150 for compensation for a birth-related neurological injury to an infant. Such a claim may be filed by any legal representative on behalf of an injured infant; and, in the case of a deceased infant, the claim may be filed by an administrator, executor, personal representative, or other legal representative.

(4)    'Administrative law judge' means an administrative law judge appointed by the Chief Judge of the Administrative Law Court.

(5)    'Administrator' means the Administrator of the South Carolina Birth-Related Neurological Injury Compensation Program.

(6)    'Hospital' means any hospital licensed in South Carolina.

(7)    'Participating physician' means a physician licensed in South Carolina to practice medicine who practices obstetrics or performs obstetrical services either full time or part-time and who had paid or was exempted from payment at the time of the injury the assessment required for participation in the South Carolina Birth-Related Neurological Injury Compensation Program for the year in which the injury occurred. Such term shall not apply to any physician who practices medicine as an officer, employee, or agent of the Federal Government. The term 'participating physician' includes a partnership, corporation, professional corporation, professional limited liability company, or other entity through which the participating physician practices.

(8)    'Family member' means a father, mother, or legal guardian.

(9)    'Family residential or custodial care' means care normally rendered by trained professional attendants which is beyond the scope of child care duties, but which is provided by family members. Family members who provide nonprofessional residential or custodial care may not be compensated under this act for care that falls within the scope of child care duties and other services normally and gratuitously provided by family members. Family residential or custodial care shall be performed only at the direction and control of a physician when such care is medically necessary. Reasonable charges for expenses for family residential or custodial care provided by a family member shall be determined as follows:

(a)    If the family member is not employed, the per-hour value equals the federal minimum hourly wage.

(b)    If the family member is employed and elects to leave that employment to provide such care, the per-hour value of that care shall equal the rates established by Medicaid for private duty services provided by a home health aide. A family member or a combination of family members providing care in accordance with this definition may not be compensated for more than a total of ten hours per day. Family care is in lieu of professional residential or custodial care, and no professional residential or custodial care may be awarded for the period of time during the day that family care is being provided.

(c)    The award of family residential or custodial care as defined in this section shall not be included in the current estimates for purposes of Section 15-80-230(I)(3).

(10)    'Fund' means the South Carolina Birth-Related Neurological Injury Compensation Fund that distributes money to qualified recipients to cover qualified expenses.

(11)    'Program' means the implementation of policies and procedures by the directors, administrator, and staff, in order to fulfill the purpose of the South Carolina Birth-Related Neurological Injury Compensation Fund.

(12) 'DHEC' means the Department of Health and Environmental Control.

Section 15-80-130.    (A) There is established the South Carolina Birth-Related Neurological Injury Compensation Fund for the purpose of providing compensation, irrespective of fault, for birth-related neurological injury claims. Such program shall apply to births occurring on or after January 1, 2008, and shall be administered by the South Carolina Birth-Related Neurological Injury Compensation Program Administrator.

(B)    The rights and remedies granted by this plan on account of a birth-related neurological injury shall exclude all other rights and remedies of such infant, his personal representative, parents, and next of kin, at common law or otherwise, against any person or entity directly involved with the labor, delivery, or immediate post-delivery resuscitation during which such injury occurs, arising out of or related to a medical negligence claim with respect to such injury; except that a civil action shall not be foreclosed where there is clear and convincing evidence of bad faith or malicious purpose or willful and wanton disregard of human rights, safety, or property, provided that such suit is filed prior to and in lieu of payment of an award under Sections 15-80-100 through 15-80-250. Such suit shall be filed before the award of the program administrator or the Administrative Law Court becomes conclusive and binding as provided for in Section 15-80-200.

(C)    Sovereign immunity is hereby waived on behalf of the South Carolina South Carolina Birth-Related Neurological Injury Compensation Program administrator solely to the extent necessary to assure payment of compensation as provided in Section 15-80-190.

Section 15-80-140.    The administrator of the program shall hear and determine all claims filed pursuant to Sections 15-80-100 through 15-80-250 and shall exercise the full power and authority granted to him to carry out the purposes of such sections. The administrator of the program has original jurisdiction to determine whether a claim filed under this act is compensable. No civil action may be brought until the determinations under Section 15-80-150 and any appeals to an administrative law judge under Section 15-80-180 have been made. If the administrative law judge determines that the claimant is entitled to compensation from the administrator of the fund, or if the claimant accepts an award issued under Section 15-80-190, no civil action may be brought or continued in violation of the exclusiveness of remedy provisions of Section 15-80-130. If it is determined that a claim filed under this act is not compensable, neither the doctrine of collateral estoppel nor res judicata shall prohibit the claimant from pursuing any and all civil remedies available under common law and statutory law. The findings of fact and conclusions of law of the administrative law judge shall not be admissible in any subsequent proceeding; however, the sworn testimony of any person and the exhibits introduced into evidence in the administrative case are admissible as impeachment in any subsequent civil action only against a party to the administrative proceeding, subject to the South Carolina Rules of Evidence. An award may not be made or paid under this chapter (Sections 15-80-100 through 15-80-250) if the claimant recovers under a settlement or a final judgment is entered in a civil action. The program may adopt rules to promote the efficient administration of, and to minimize the cost associated with, the administration of claims.

Section 15-80-150.    (A)    All claims filed for compensation under the program shall commence by the claimant filing with the administrator a petition seeking compensation. Such petition shall include the following information:

(1)    the name and address of the legal representative;

(2)    the name and address of the injured infant;

(3)    the name and address of any physician providing obstetrical services who was present at the birth and the name and address of the hospital at which the birth occurred;

(4)    a description of the disability for which the claim is made;

(5)    the time and place the injury occurred; and

(6)    a brief statement of the facts and circumstances surrounding the injury and giving rise to the claim.

(B)    The claimant shall furnish the program staff with as many paper copies of the petition as required for service upon any physician, health care provider, and hospital named in the petition. The claimant also shall furnish the program an electronic version of the petition which shall include electronically scanned images of all supporting documents in formats designated by the administrator. Upon receipt of the petition, the program staff shall immediately date and file the petition and notify the administrator of the claim. The paper copies of the petition shall be sent immediately by registered or certified mail to any physician, health care provider, and hospital named in the petition. Electronic versions of the petition shall be sent to director of the South Carolina Department of Labor, Licensing and Regulation at his official email address and to the director of the DHEC Division of Health Licensing at his official email address.

(C)    The claimant shall furnish to the South Carolina Birth-Related Neurological Injury Compensation Program the following information, which must be filed with the program staff within ten days after the filing of the petition as set forth in subsection (A):

(1)    all available relevant medical records relating to the birth-related neurological injury and a list identifying any unavailable records known to the claimant and the reasons for the records' unavailability;

(2)    appropriate assessments, evaluations, and prognoses and such other records and documents as are reasonably necessary for the determination of the amount of compensation to be paid to, or on behalf of, the injured infant on account of the birth-related neurological injury;

(3)    documentation of expenses and services incurred to date which identifies any payment made for such expenses and services and the payor; and

(4)    documentation of any applicable private or governmental source of services or reimbursement relative to the impairments.

The information required by items (1) through (4) shall remain confidential.

(D)    The administrator shall have forty-five days from the date of service of a complete claim, filed pursuant to subsections (A) and (B), in which to file a response to the petition and to submit relevant written information relating to the issue of whether the injury alleged is a birth-related neurological injury.

(E)    Upon receipt of such petition, the South Carolina Department of Labor, Licensing and Regulation shall review the information therein and determine whether it involved conduct by a physician licensed by the Board of Medical Examiners who is subject to disciplinary action, in which case the provisions of the Medical Practice Act shall apply.

(F)    Upon receipt of such petition, the DHEC Division of Health Licensing shall investigate the claim, and if it determines that the injury resulted from, or was aggravated by, a violation of licensing standards on the part of a hospital, it shall take any such action consistent with its disciplinary authority as may be appropriate.

(G)(1)    The administrator shall make the following determinations based upon all available evidence:

(a)    whether the injury claimed is a birth-related neurological injury. If the claimant has demonstrated, to the satisfaction of the administrator, that the infant has sustained a birth-related neurological injury which rendered the infant substantially handicapped based on the score of a standardized neurological impairment scale, a rebuttable presumption shall arise that the injury is a birth-related neurological injury as defined in Section 15-80-120(A)(1);

(b)    whether obstetrical services were delivered by a participating physician in the course of labor, delivery, or resuscitation in the immediate post-delivery period in a hospital; or by a certified nurse midwife supervised by a participating physician in the course of labor, delivery, or resuscitation in the immediate post-delivery period in a hospital; or

(c)    any claim which the administrator determines to be compensable may be accepted for compensation. Such compensation, if any, is awardable limited to the qualified expenses prescribed in Section 15-80-190(A). Payment shall be made in accordance to Section 15-80-190(B). Notice of the award must be sent as described in Section 15-80-190(C).

(2)    Any claim which the administrator determines to be not compensable may be appealed by filing for a hearing and paying the filing fee with the Administrative Law Court in accordance with the Rules of Procedure for the Administrative Law Court.

Section 15-80-160.    The statute of limitations with respect to any civil action that may be brought by, or on behalf of, an injured infant allegedly arising out of, or related to, a birth-related neurological injury shall be tolled by the filing of a claim in accordance with Sections 15-80-100 through 15-80-250, and the time such claim is pending or is on appeal shall not be computed as part of the period within which such civil action may be brought.

Section 15-80-170.    (A)    The administrative law judge shall set the date for an appeal hearing no sooner than sixty days and no later than one hundred twenty days after the denial of a claim by the fund administrator. The administrative law judge shall immediately notify the parties of the time and place of such hearing, which shall be held at the South Carolina Administrative Law Court.

(B)    The parties to the hearing shall include the claimant and the administrator or his representative.

(C)    Any party to a proceeding under Sections 15-80-100 through 15-80-250 may, upon application to the administrative law judge setting forth the materiality of the evidence to be given, serve interrogatories or cause the depositions of witnesses residing in or out the state to be taken, the costs thereof to be taxed as expenses incurred in connection with the filing of a claim. Such depositions shall be taken after giving notice and in the manner prescribed for the taking of depositions in actions at law, except that they shall be directed to the administrative law judge before whom the proceedings may be pending.

Section 15-80-180.    (A)    The administrative law judge shall make the following determinations based upon all available evidence:

(1)    whether the injury claimed is a birth-related neurological injury. If the claimant has demonstrated, to the satisfaction of the administrative law judge, that the infant has sustained a birth-related neurological injury which rendered the infant substantially handicapped based on the score of a standardized neurological impairment scale, a rebuttable presumption shall arise that the injury is a birth-related neurological injury as defined in Section 15-80-120(A)(1);

(2)    whether obstetrical services were delivered by a participating physician in the course of labor, delivery, or resuscitation in the immediate post-delivery period in a hospital; or by a certified nurse midwife supervised by a participating physician in the course of labor, delivery, or resuscitation in the immediate post-delivery period in a hospital; or

(3)    how much compensation, if any, is awardable pursuant to Section 15-80-190.

(B)    If the administrative law judge determines that the injury alleged is not a birth-related neurological injury or that obstetrical services were not delivered by a participating physician at the birth, he shall enter an order and shall cause a copy of such order to be sent immediately to the parties by registered or certified mail.

(C)    By becoming a participating physician, a physician shall be bound for all purposes by the finding of the administrative law judge or any appeal therefrom with respect to whether such injury is a birth-related neurological injury.

(D)    If it is in the interest of judicial economy or if requested to by the claimant, the administrative law judge may bifurcate the proceeding addressing compensability and notice pursuant to Section 15-80-250 first, and addressing an award pursuant to Section 15-80-190, if any, in a separate proceeding. The administrative law judge may issue a final order on compensability and notice which is subject to appeal under Section 15-80-200, prior to issuance of an award pursuant to Section 15-80-190.

Section 15-80-190.    (A)    Upon determining that an infant has sustained a birth-related neurological injury and that obstetrical services were delivered by a participating physician at the birth, the administrative law judge shall make an award providing compensation for the following items relative to such injury:

(1)    actual expenses for medically necessary and reasonable medical and hospital, rehabilitative and training, family residential or custodial care, professional residential, and custodial care and service, for medically necessary drugs, special equipment, and facilities, and for related travel. However, such expenses shall not include:

(a)    expenses for items or services that the infant has received, or is entitled to receive, under the laws of any state or the federal government, except to the extent such exclusion may be prohibited by federal law;

(b)    expenses for items or services that the infant has received, or is contractually entitled to receive, from any prepaid health plan, health maintenance organization, or other private insuring entity; and

(c)    expenses for which the infant has received reimbursement, or for which the infant is entitled to receive reimbursement, under the laws of any state or the federal government, except to the extent such exclusion may be prohibited by federal law;

(d)    expenses for which the infant has received reimbursement, or for which the infant is contractually entitled to receive reimbursement, pursuant to the provisions of any health or sickness insurance policy or other private insurance program.

Expenses included under this subsection shall be limited to reasonable charges prevailing in the same community for similar treatment of injured persons when such treatment is paid for by the injured person;

(2)(a)    periodic payments of an award to the parents or legal guardians of the infant found to have sustained a birth-related neurological injury, which award shall not exceed one hundred thousand dollars. However, at the discretion of the administrative law judge, such award may be made in a lump sum; and

(b)    death benefit for the infant in an amount of ten thousand dollars; and

(3)    reasonable expenses incurred in connection with the filing of a claim under Sections 15-80-100 through 15-80-250, including reasonable attorney's fees, which shall be subject to the approval and award of the administrative law judge. In determining an award for attorney's fees, the administrative law judge shall consider the following factors:

(a)    the time and labor required, the novelty and difficulty of the questions involved, and the skill requisite to perform the legal services properly;

(b)    the fee customarily charged in the locality for similar legal services;

(c)    the time limitations imposed by the claimant or the circumstances;

(d)    the nature and length of the professional relationship with the claimant; and

(e)    the experience, reputation, and ability of the lawyer or lawyers performing services; and

(4)    should there be a final determination of compensability, and the claimants accept an award under this section, the claimants shall not be liable for any expenses, including attorney's fees, incurred in connection with the filing of a claim under Sections 15-80-100 through 15-80-250 other than those expenses awarded under this section.

(B)    The award shall require the immediate payment of expenses previously incurred and shall require that future expenses be paid as incurred.

(C)    A copy of the award shall be sent immediately by registered or certified mail to each person served with a copy of the petition under Section 15-80-150(B)

Section 15-80-200.    (A)    A determination of the administrative law judge as to qualification of the claim for purposes of compensability under Section 15-80-180 or an award by the administrative law judge pursuant to Section 15-80-190 shall be conclusive and binding as to all questions of fact. Review of an order of an administrative law judge shall be by appeal to the South Carolina Circuit Court. Appeals shall be filed in accordance with rules of procedure prescribed by the Circuit Court for review of such orders.

(B)    In case of an appeal from an award of the administrative law judge, the appeal shall operate as a suspension of the award, and the administrator shall not be required to make payment of the award involved in the appeal until the questions at issue therein shall have been fully determined.

Section 15-80-210.    (A)    The administrative law judge shall have full authority to enforce his awards and to protect himself from any deception or lack of cooperation in reaching his determination as to any award. Such authority shall include the power to petition the circuit court for an order of contempt.

(B)    A claimant may, if the circumstances so warrant, petition the circuit court for enforcement of a final award by the administrative law judge.

Section 15-80-220.    Any claim for compensation under Sections 15-80-100 through 15-80-250 that is filed more than ten years after the birth of an infant alleged to have a birth-related neurological injury shall be barred.

Section 15-80-230.    (A)    The assessments established pursuant to this section shall be used to finance the South Carolina Birth-Related Neurological Injury Compensation Program.

(B)    The assessments and appropriations dedicated to the program shall be administered by the South Carolina Birth-Related Neurological Injury Compensation Program Administrator established in Section 15-80-240, in accordance with the following requirements:

(1)    on or before July 1, 2007, the directors of the fund shall submit to the Department of Insurance for review a plan of operation which shall provide for the efficient administration of the plan and for prompt processing of claims against and awards made on behalf of the plan. The plan of operation shall include provision for:

(a)    establishment of necessary facilities;

(b)    management of the funds collected on behalf of the plan;

(c)    processing of claims against the plan;

(d)    assessment of the persons and entities listed in subsections (D) and (E) to pay awards and expenses, which assessments shall be on an actuarially sound basis subject to the limits set forth in subsections (D) and (E); and

(2)    any other matters necessary for the efficient operation of the birth-related neurological injury compensation plan:

(a)    amendments to the plan of operation may be made by the administrators of the program, subject to the approval of the Department of Insurance.

(C)    All assessments shall be deposited with the South Carolina Birth-Related Neurological Injury Compensation Fund. The funds collected by the Program and any income therefrom shall be disbursed only for the payment of awards under Sections 15-80-100 through 15-80-250 and for the payment of the reasonable expenses of administering the program.

(D)    The following persons and entities shall pay into the association an initial assessment in accordance with the plan of operation:

(1)    On or before October 1, 2007, each hospital licensed under South Carolina law shall pay an initial assessment of fifty dollars per infant delivered in the hospital during the prior calendar year, as reported to DHEC; provided, however, that a hospital owned or operated by the State or a county, special taxing district, or other political subdivision of the State shall not be required to pay the initial assessment or any assessment required by subsection (E). The term 'infant delivered' includes live births and not stillbirths. Upon demonstration of financial need by a hospital, the association may provide for installment payments of assessments.

(2)(a)    On or before October 15, 2007, all physicians licensed by the Medical Board of Examiners as of October 1, 2007, other than participating physicians, shall be assessed an initial assessment of two hundred fifty dollars, which must be paid no later than December 1, 2007.

(b)    Any such physician who becomes licensed after September 30, 2007, and before January 1, 2008, shall pay into the Fund an initial assessment of two hundred fifty dollars upon licensure.

(c)    Any such physician who becomes licensed on or after January 1, 2008, shall pay an initial assessment equal to the most recent assessment made pursuant to this subsection, subsection (E), or subsection (G)(2).

(d)    However, if the physician is a physician specified in this item, the assessment is not applicable:

(i)        a resident physician, assistant resident physician, or intern in an approved postgraduate training program, as defined by the Medical Practice Act by rule;

(ii)    a physician who is employed full time by the United States Department of Veterans Affairs and whose practice is confined to United States Department of Veterans Affairs hospitals;

(iii)    a physician who is a member of the Armed Forces of the United States and practices medicine as an employee of the Armed Forces; or

(iv)    a physician who is employed full time by the State of South Carolina and whose practice is confined to state-owned correctional institutions, a county health department, or state-owned mental health or developmental services facilities, or who is employed full time by DHEC.

(3)    On or before December 1, 2007, each physician licensed by the South Carolina Department of Labor, Licensing and Regulation who wishes to participate in the South Carolina Birth-Related Neurological Injury Program and who otherwise qualifies as a participating physician under Sections 15-80-100 through 15-80-250 shall pay an initial assessment of five thousand dollars. However, if the physician is either a resident physician, assistant resident physician, or intern in an approved postgraduate training program, as defined by the Board of Medical Examiners by rule, and is supervised in accordance with program requirements by a physician who is participating in the plan, such resident physician, assistant resident physician, or intern is deemed to be a participating physician without the payment of the assessment. Participating physicians also include any employee of the board of trustees of a state university who has paid the assessment required by this subsection and subsection (E), and any certified nurse midwife supervised by such employee. Participating physicians include any certified nurse midwife who has paid fifty percent of the physician assessment required by this subsection and subsection (E) and who is supervised by a participating physician who has paid the assessment required by this subsection and subsection (E). Supervision for certified nurse midwives shall require that the supervising physician will be easily available and have a prearranged plan of treatment for specified patient problems which the supervised certified nurse midwife may carry out in the absence of any complicating features. Any physician who elects to participate in such plan on or after January 1, 2008, who was not a participating physician at the time of such election to participate and who otherwise qualifies as a participating physician under Sections 15-80-100 through 15-80-250 shall pay an additional initial assessment equal to the most recent assessment made pursuant to this subsection, subsection (E), or subsection (G)(2).

(E)    Beginning January 1, 2009, the persons and entities listed in subsections (D)(2) and (3), except those persons or entities who are specifically excluded from said provisions, as of the date determined in accordance with the plan of operation, taking into account persons licensed subsequent to the payment of the initial assessment, shall pay an annual assessment in the amount equal to the initial assessments provided in subsections (D)(2) and (3). If payment of the annual assessment by a physician is received by the program by January thirty-first of any calendar year, the physician shall qualify as a participating physician for that entire calendar year. If the payment is received after January thirty-first of any calendar year, the physician shall qualify as a participating physician for that calendar year only from the date the payment was received by the program. On January 1, 2010, and on each January first thereafter, the program shall determine the amount of additional assessments necessary pursuant to subsection (G), in the manner required by the plan of operation, subject to any increase determined to be necessary by the Department of Insurance pursuant to subsection (G)(2). On July 1, 2010, and on each July first thereafter, the persons and entities listed in subsections (D)(2) and (3), except those persons or entities who are specifically excluded from said provisions, shall pay the additional assessments which were determined on January first. Beginning January 1, 2009, the entities listed in subsection (D)(1), including those licensed on or after October 1, 2007, shall pay an annual assessment of fifty dollars per infant delivered during the prior calendar year. The additional assessments which were determined on January 1, 2009, pursuant to the provisions of subsection (G) shall not be due and payable by the entities listed in subsection (D)(1) until July first.

(F)(1)    The program shall make all assessments required by this section, except initial assessments of physicians licensed on or after October 1, 2007, which assessments will be made by the South Carolina Department of Labor, Licensing and Regulation. Beginning October 1, 2008, for any physician licensed between October first and December thirty-first of any year, South Carolina Department of Labor, Licensing and Regulation shall make the initial assessment plus the assessment for the following calendar year. The South Carolina Department of Labor, Licensing and Regulation shall provide the program, with such frequency as determined to be necessary, a listing, in a computer-readable form, of the names and addresses of all licensed physicians.

(2)(a)    The fund may enforce collection of assessments required to be paid pursuant to Sections 15-80-100 through 15-80-240 by suit filed in circuit court in the circuit of the defendant's residence. The program shall be entitled to an award of attorney's fees, costs, and interest upon the entry of a judgment against a physician for failure to pay such assessment, with such interest accruing until paid.

(b)    The South Carolina Department of Labor, Licensing and Regulation, upon notification by the program that an assessment has not been paid and that there is an unsatisfied judgment against a physician, shall not renew any license to practice for such physician until such time as the judgment is satisfied in full.

(3)    The DHEC Division of Health Licensing shall, upon notification by the program that an assessment has not been timely paid, enforce collection of such assessments required to be paid by hospitals pursuant to Sections 15-80-100 through 15-80-240. Failure of a hospital to pay such assessment is grounds for disciplinary action and suspension of their license notwithstanding any provision of law to the contrary.

(G)(1)    The Department of Insurance shall undertake an actuarial investigation of the requirements of the plan based on the plan's experience in the first year of operation and any additional relevant information, including without limitation the assets and liabilities of the plan.

(2)    If the Department of Insurance finds that the plan cannot be maintained on an actuarially sound basis based on the assessments and appropriations listed in subsections (D) and (E), the program shall increase the assessments specified in subsection (D) on a proportional basis as needed.

(H)    The program shall report to the legislature its determination as to the annual cost of maintaining the fund on an actuarially sound basis. In making its determination, the program shall consider the recommendations of all hospitals, physicians, attorneys, consumers, and any associations representing any such person or entity. All hospitals, departments, boards, commissions, and legislative committees shall provide the program with all relevant records and information upon request to assist the program in making its determination. All hospitals shall, upon request by the program, provide the program with information from their records regarding any live birth. Such information shall not include the name of any physician, the name of any hospital employee or agent, the name of the patient, or any other information which will identify the infant involved in the birth. Such information thereby obtained shall be utilized solely for the purpose of assisting the program and shall not subject the hospital to any civil or criminal liability for the release thereof. Such information shall otherwise be confidential.

(I)(1)    Within sixty days after a claim is filed, the program shall estimate the present value of the total cost of the claim, including the estimated amount to be paid to the claimant, the claimant's attorney, the attorney's fees of the program incident to the claim, and any other expenses that are reasonably anticipated to be incurred by the program in connection with the adjudication and payment of the claim. For purposes of this estimate, the program shall include the maximum benefits for non-economic damages.

(2)    The program shall revise these estimates quarterly based upon the actual costs incurred and any additional information that becomes available to the program since the last review of this estimate. The estimate shall be reduced by any amounts paid by the program that were included in the current estimate.

(3)    In the event the total of all current estimates equals eighty percent of the funds on hand and the funds that will become available to the program within the next twelve months from all sources described in subsections (D) and (E) and subsection (G)(1), the program shall not accept any new claims without express authority from the legislature. Nothing herein shall preclude the program from accepting any claim if the injury occurred eighteen months or more prior to the effective date of this suspension. Within thirty days of the effective date of this suspension, the program shall notify the Governor, the Speaker of the House of Representatives, the President of the Senate, the Department of Insurance, the DHEC Division of Health Licensing, and the South Carolina Department of Labor, Licensing and Regulation of this suspension.

(4)    If any person is precluded from asserting a claim against the association because of item (3), the plan shall not constitute the exclusive remedy for such person, his personal representative, parents, dependents, or next of kin.

Section 15-80-240.    (A)(1)    The South Carolina Birth-Related Neurological Injury Program shall be governed by a board of five directors. The program is authorized to use the state seal.

(2)    The directors shall be appointed for staggered terms of five years or until their successors are appointed and have been qualified.

(3)    The directors shall be appointed by the Governor as follows:

(a)    one representative of families who currently have a birth-related neurologically injured child with an initial term of five years;

(b)    one representative of participating physicians with an initial term of four years;

(c)    one citizen representative with an initial term of three years;

(d)    one representative of hospitals with an initial term of two years; or

(e)    one representative of physicians other than participating physicians with an initial term of one year.

(B)(1)    The Governor may select:

(a)    the representative of the families from a list of at least three names to be recommended by the Senate;

(b)    the representative of the participating physicians from a list of at least three names to be recommended by the South Carolina Chapter of The American Academy of Pediatrics;

(c)    the representative of hospitals from a list of at least three names to be recommended by the South Carolina Hospital Association; and

(d)    the representative of physicians other than participating physicians from a list of three names to be recommended by the South Carolina Medical Association, the citizen representative from a list of three names to be recommended by the House of Representatives.

In no case shall the Governor be bound to make any appointment from among the nominees of such respective recommending bodies.

(2)    The Governor shall promptly notify the appropriate recommending bodies upon the occurrence of any vacancy, and like nominations may be made for the filling of the vacancy.

(C)    The directors shall not transact any business or exercise any power of the program except upon the affirmative vote of three directors. The directors shall serve without salary, but each director shall be reimbursed for actual and necessary expenses incurred in the performance of his or her official duties as a director of the program. The directors shall not be subject to any liability with respect to the administration of the plan.

(D)    The board of directors shall have the power to:

(1)    appoint the program administrator, establish his job qualifications, job description and duties, and define the standards by which he makes his decisions in accordance with the language of this chapter;

(2)    administer the program;

(3)    administer the funds collected on behalf of the program;

(4)    administer the payment of claims on behalf of the program;

(5)    direct the investment and reinvestment of any surplus funds over losses and expenses, provided that any investment income generated thereby remains credited to the program;

(6)    reinsure the risks of the program in whole or in part;

(7)    sue and be sued, and appear and defend, in all actions and proceedings in its name to the same extent as a natural person;

(8)    have and exercise all powers necessary or convenient to effect any or all of the purposes for which the program is created;

(9)    enter into such contracts as are necessary or proper to administer the program;

(10)    employ or retain such persons as are necessary to perform the administrative and financial transactions and responsibilities of the program and to perform other necessary and proper functions not prohibited by law; and

(11)    take such legal action as may be necessary to avoid payment of improper claims;

(12)    indemnify any employee, agent, member of the board of directors or alternate thereof, or person acting on behalf of the program in an official capacity, for expenses, including attorney's fees, judgments, fines, and amounts paid in settlement actually and reasonably incurred in connection with any action, suit, or proceeding, including any appeal thereof, arising out of such person's capacity acting on behalf of the plan; provided that such person acted in good faith and in a manner he reasonably believed to be in, or not opposed to, the best interests of the program and provided that, with respect to any criminal action or proceeding, the person had reasonable cause to believe his conduct was lawful.

(E)(1)    Funds may be withdrawn on account of the program only upon a voucher as authorized by the program.

(2)    All books, records, and audits of the program are open for reasonable inspection to the general public, except that a claim file in the possession of the association or its representative is confidential, although medical records and other portions of the claim file may remain confidential and exempt as otherwise provided by law. Any book, record, document, audit, or asset acquired by, prepared for, or paid for by the program is subject to the authority of the board of directors, which is responsible therefore.

(3)    Each person authorized to receive deposits, issue vouchers, or withdraw or otherwise disburse any money shall post a blanket fidelity bond in an amount reasonably sufficient to protect program assets, as determined by the plan of operation. The cost of such bond will be paid from the assets of the program.

(4)    Annually, the association shall furnish audited financial reports to any plan participant upon request and to the Legislative Audit Council. The reports must be prepared in accordance with accepted accounting procedures and must include such information as may be required by the Legislative Audit Council. At any time determined to be necessary, the Legislative Audit Council may conduct an audit of the program.

(5)    Funds held on behalf of the program are funds of the State of South Carolina. The program may only invest funds in the investments and securities allowed by state law and shall be subject to the limitations on investments prescribed by state law. All income derived from such investments will be credited to the program.

Section 15-80-250.    Each hospital with a participating physician on its staff and each participating physician, other than residents, assistant residents, and interns deemed to be participating physicians under Section 15-80-220(D)(3), under the South Carolina Birth-Related Neurological Injury Compensation Program shall provide notice to the obstetrical patients as to the limited no-fault alternative for birth-related neurological injuries. Such notice shall be provided on forms furnished by the program and shall include a clear and concise explanation of a patient's rights and limitations under the program. The hospital or the participating physician may elect to have the patient sign a form acknowledging receipt of the notice form. Signature of the patient acknowledging receipt of the notice form raises a rebuttable presumption that the notice requirements of this section have been met. Notice need not be given to a patient when the patient has an emergency medical condition or when notice is not practicable."

SECTION    2.    If any section, subsection, item, subitem, paragraph, subparagraph, sentence, clause, phrase, or word of this act is for any reason held to be unconstitutional or invalid, such holding shall not affect the constitutionality or validity of the remaining portions of this act, the General Assembly hereby declaring that it would have passed this act, and each and every section, subsection, item, subitem, paragraph, subparagraph, sentence, clause, phrase, and word thereof, irrespective of the fact that any one or more other sections, subsections, items, subitems, paragraphs, subparagraphs, sentences, clauses, phrases, or words hereof may be declared to be unconstitutional, invalid, or otherwise ineffective.

SECTION    3.    This act takes effect upon approval by the Governor.