ROBERT L. EHRLICH, JR., Governor

H.B. 2

of the citizens of the State is one of our goals, this bill will increase the costs on the
most affordable plans with the likely result that more people will decide to go without
health care coverage because they cannot afford it.

The Maryland Health Care Commission supports this conclusion. The
commission notes that studies by the Lewin Group and the Congressional Budget
Office reached the unsurprising conclusion that increases in premiums lead to
reductions in the numbers of people with health insurance since the price increase
would lead some people to drop their coverage. This means that the 1.2 million
Marylanders with health coverage through HMOs will have to choose between paying
higher premiums or possibly reducing or dropping coverage. This certainly is not a
desirable result.

The Maryland Health Care Commission has also expressed concerns with this
tax and its effect on the Comprehensive Standard Health Benefit Plan. You were
instrumental in having this plan enacted and in fact were the prime sponsor of the
crossfile of the bill that was eventually enacted in the 2003 session. The commission
states that this tax will force it to review the cost of the plan and possibly adjust the
plan either by reducing benefits or increasing costs in order to stay within the plan's
statutory requirements. In other words, the 260,000 Maryland citizens in the small
group market who have HMO coverage may be subject to a double penalty of paying
more while the commission is forced to reduce their coverage benefits. The HMO tax
is poor public policy.

Miscellaneous Issues

Cancellation of Medical Professional Liability Insurance - Section 27-501 of the
Insurance Article has been amended to allow a medical professional liability insurer
to cancel or refuse to renew an insured who has been licensed as a health care
provider in the State for more than three years without having to justify the action
based on "standards that are reasonably related to the insurer's economic and
business purposes." This means that a malpractice insurer may for any reason or for
no reason cancel a physician or other provider who has been licensed in the State for
more than three years. I cannot fathom the public policy argument that would justify
this result. I can only think that this again reflects the haste with which this bill was
drafted.

Expert Witnesses- I also note that many of the provisions dealing with expert
witnesses have either been removed or watered down. These provisions were designed
to prevent the prevalent use of "hired gun" experts who do not practice medicine but
instead have become experts for hire. Even the provision codifying the D'Angelo
decision of the Court of Special Appeals, which held that the plaintiff must file a
certificate of qualified expert for each defendant, has been stricken. This was
designed to ensure that plaintiffs know their cases when they file them and do not sue
29 doctors without having good reason, as was the case in D'Angelo. The addition of
this requirement in the supplemental certificate of qualified expert does not achieve
the desired result, as this occurs only many months into the process after discovery is
completed.

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