• General Information


• Fund Administration and Contact Information


• Statutory Obligations for Malpractice Coverage in Wisconsin


• Type of Coverage Provided by the Injured Patients and Families Compensation Fund


• Exemptions from Fund Coverage


• Reversal of Exemptions


• Certificate Compliance/Noncompliance


• Fund Classes


• Setting Fund Fees


• Billing Procedure


• Administrative Fee Assessment/Interest


• Billing Statement Format


• Financial Compliance/Noncompliance


• Group Billings


• Credit Balances


• Part-Time and Half-Time Practice


• Moonlighting Residents


• Locum Tenens


• Refund of Payment


• Claims Administration/Adjudication


• Board of Governors


• Certificate Verifier (zip file)

• Reports
         2008 Functional and Progress Report
• Presentations
         Strategies for Building a Culture of Safety
         Winnebago County Medical Society, April 6, 2006
         Risk Management - Workplace Violence in Healthcare (file size 1,038KB)
• IPFCF WiscRisk (Quarterly Publication)
         Spring 2010
         Winter 2009
         Fall 2009
         Summer 2009
• Bulletins
         June 2006, Regarding Changes in Fund Classifications

General Information

The Fund was created by statute in 1975 to provide excess medical malpractice coverage for Wisconsin health care providers. Health care providers obtain primary medical malpractice insurance from private insurance companies in an amount required by statute. As of July 1, 1997, that amount is $1,000,000 per occurrence, and $3,000,000 annual aggregate. Coverage in excess of the primary insurance is provided by the Fund.

The Fund is governed by a 13 member Board of Governors (Board) that consists of 3 insurance industry representatives, a member named by the Wisconsin Academy of Trial Lawyers, a member named by the State Bar Association, 2 members named by the State Medical Society of Wisconsin, a member named by the Wisconsin Hospital Association, 4 public members appointed by the Governor, and the Commissioner of Insurance who serves as the chair. The Fund’s administrative staff is provided by the Office of the Commissioner of Insurance.

The Board is assisted by an Underwriting and Actuarial Committee, a Legal Committee, a Claims Committee, an Investment/Finance and Audit Committee, a Risk Management Committee, and a Peer Review Council. The Board and its committees meet quarterly.

The Fund operates on a fiscal year basis--July 1 through June 30. Administrative costs, operating costs, and claim payments are funded through assessments on participating health care providers.

Fund Administration and Contact Information

Administrative staff is provided by the Office of the Commissioner of Insurance. Fund staff consists of an Administrative Officer (Chief of the Fund), and six full-time employes. Staff ensures compliance with the filing of primary insurance certificates, billing and collection of assessments, and claims. The Fund contracts with outside consultants for the following services: Claims Administration, Actuarial Services, Risk Management, and Information System Development. Staff monitors outside contracts. Investments are managed by the State of Wisconsin Investment Board based on guidelines approved by the Board of Governors.

Fund Contacts:

Fund Mailing Address:
P.O. Box 7873
Madison, WI 53707-7873

Fund Street Address:
125 South Webster Street
Madison, WI 53703-3474

Fund Fax No. (608) 266-8064

Statutory Obligations for Malpractice Coverage in Wisconsin

Section 655.23 (4), Wis. Stat., requires all of the following to insure and keep insured their primary liability in amounts of at least $1,000,000 per occurrence/$3,000,000 annual aggregate:

• Physicians and osteopaths licensed under ch. 448, Wis. Stat.;
• Registered nurses licensed under ch. 441, Wis. Stat., who are certified by the American Association of Nurse Anesthetists;
• Corporations/partnerships organized and operated in Wisconsin comprised of physicians and nurse anesthetists for the primary purpose of providing medical services of physicians or nurse anesthetists;
• Cooperative sickness care associations;
• Ambulatory surgery centers;
• Hospitals and hospital affiliates;
• Nursing homes.

The primary layer of coverage is obtained from private medical malpractice insurers, through approved self-funded plans, or purchased from the state-sponsored Wisconsin Health Care Liability Insurance Plan (WHCLIP). Self-funded plans must meet statutory requirements and be approved by the Office of the Commissioner of Insurance.

The providers listed above are required to purchase coverage from the Fund for the excess layer of malpractice coverage. Participation in the Fund is mandatory unless the provider qualifies for a statutory exemption. Fund coverage is unlimited.

Administration of and payment for the primary and excess layers of coverage are separate. Health care providers must therefore ensure compliance with two sets of administrative and financial requirements by obtaining coverage from a malpractice insurance carrier for the primary layer or self-insuring through an OCI-approved plan and obtaining coverage with the Fund for the excess layer.

Type of Coverage Provided by the Injured Patients and Families Compensation Fund

The Fund provides coverage on an occurrence basis. Payment of the premium for a given period of practice entitles the participant to coverage for claims filed for any acts of malpractice that occur in the period for which the premium is paid. This includes claims that are filed subsequent to the Fund coverage cancellation date if the act of malpractice occurred during a period in which the Fund coverage was in force.

Primary insurance may be obtained on an occurrence or claims made basis. A claims made policy only covers those claims reported during the policy period. If a provider has claims made coverage, a tail policy or extended reporting endorsement must be purchased to cover incurred claims reported after the claims made policy has been terminated. The tail coverage is required in order for the provider to be in compliance with Fund requirements.

If a provider changes from a claims made policy to an occurrence policy, "tail," "nose," or prior acts coverage must be obtained to cover those claims occurring prior to the effective date of the occurrence-based policy.

Prior acts coverage can be purchased from a new claims made carrier if tail coverage is not purchased from previous claims made carrier. If a provider changes from claims made to occurrence, tail coverage could be purchased rather than prior acts coverage.

Exemptions from Fund Coverage

The statutes allow a health care provider to exempt themselves from participation in the Fund if one of several specific criteria is met. A provider who claims an exemption has no Fund coverage and may be personally liable for damages awarded for malpractice. Exemption forms must be filed with the Fund for providers that are eligible. The following exemptions allow providers to choose not to participate in the Fund:

• Physicians or Certified Registered Nurse Anesthetists (CRNAs) who do not practice in Wisconsin for more than 240 hours in a fiscal year.
• Physicians or CRNAs employed by the state, a county, or municipality who do not expect to practice outside of that employment for more than 240 hours during the fiscal year.
• Licensed physicians or CRNAs whose principal place of practice is not in Wisconsin (50% of the income from the practice is derived from outside of Wisconsin or more than 50% of patients will be attended to outside Wisconsin during the fiscal year).
• Federal employes covered under the Federal Tort Claims Act who do not expect to practice outside that employment for more than 240 hours during the fiscal year.
• Physicians or CRNAs retired from practice in Wisconsin.
• Physicians or CRNAs licensed in Wisconsin who have never practiced in Wisconsin to date.
• Corporations and partnerships organized and operated in Wisconsin that cease providing medical services in Wisconsin.

All licensed providers eligible for Fund coverage are registered in the Fund’s data base upon licensure. Therefore, it is important for all eligible Fund participants to file for coverage or exemption for all periods for which a license is active, regardless of period of practice or specialty.

An Injured Patients and Families Compensation Fund Exemption form is available to be downloaded below. Note, however, that you will need an Adobe Acrobat Reader to view or print the form, which you can download at no cost from Adobe .

Injured Patients and Families Compensation Fund Exemption Form OCI 31-001

Completed exemption forms should be mailed to P.O. Box 7873, Madison, Wisconsin 53707-7873.

Reversal of Exemptions

If it is determined that an exemption form was mistakenly filed, the provider may request reversal of the exemption by submitting a letter to the Fund no more than 105 days from the effective date of the exemption in question, or from the Fund’s receipt of the exemption form, whichever is greater. Requests received beyond the 105 days will require Legal Committee and Board approval via the retroactive coverage request.

Request for Retroactive Coverage Form OCI 31-023

Certificate Compliance/Noncompliance

The filing of a certificate of insurance (certifying primary insurance coverage) triggers Fund enrollment and Fund coverage for the health care provider. The primary insurance carrier must submit a certificate of coverage which indicates both the provider ISO code and provider type. This information will be used by the Fund to classify and bill the provider. Unless an insurance company receives a written exemption from the Fund, all certificate information is to be submitted to the Fund electronically. The electronically filed information must be in the form prescribed by the Fund. See Data Layout.

Certificates of insurance, not submitted electronically, must be submitted on the "Certificate of Insurance for Primary Health Care Liability," Form OCI 31-020. The certificate must be completed in accordance with the certificate of insurance instructions. Any incorrect or incomplete items will result in the certificate being returned to the insurer.

A Certificate of Insurance for Primary Health Care Liability form is available to be downloaded below. Note, however, that you will need an Adobe Acrobat Reader to view or print the certificate, which you can download at no cost from Adobe .

Every physician and CRNA must purchase primary medical malpractice coverage at the levels defined in ch. 655. Wis. Stat. (currently $1,000,000 per occurrence/$3,000,000 annual aggregate). The primary insurer is required by law to file a certificate of primary coverage with the Fund for each MD, DO, and CRNA provided the primary layer of coverage. Certificates should be filed as close to the effective date of the policy as possible.

Certificates of primary insurance received within 45 days of the start date of a policy period are entered into the Fund’s computer system, and an assessment is automatically produced. A health care provider who does not have a certificate or renewal on file within 45 days of licensure or within 45 days of the expiration date of the most recent certificate on file is considered delinquent. He or she will be notified by mail. The initial notice is sent 45 days after expiration, a second notice is sent 30 days later (day 75), and referral is made to the Medical Examining Board after another 30 days (day 105). For certificates received within 105 days of the primary policy or licensure effective date, a file is created in the Fund’s system and an assessment is mailed to the provider.

For certificates filed late (between days 45 and 105), a fine may be issued to the insurer. In addition, the provider must petition for retroactive coverage and for this period is sent an affidavit to file with the Fund stating that he or she has no notice of any pending claim(s), threatened claim(s), or occurrence(s) that might give rise to a claim during the late period. Inability of a provider to attest there are no known claims will result in Fund coverage for a period beginning 45 days prior to the receipt of the certificate of insurance. Coverage will not be provided from the start date of the policy period.

The Medical Examining Board may suspend the provider’s license after day 105, effectively prohibiting the provider from practice until payment is received by the Fund. Once the certificate is filed, the provider’s account will be credited for any period previously billed for which Fund coverage was not afforded. The Fund Legal Committee reviews the petition for retroactive coverage and approves or denies retroactive coverage based on the circumstances of the case. If approved, the provider’s account is credited for the late period of the certificate (the period more than 45 days prior to the receipt date of the certificate).

Fund Classes

There are four Fund classes based on provider specialty. Physician specialties are identified by the applicable insurance services office (ISO) codes in ch. Ins. 17, Wis. Adm. Code. Physicians whose loss exposure is similar are grouped together in one of the four classes. Class 1 includes specialties with the lowest risk and is therefore priced at the lowest rate. Class 4 represents the greatest risk and is priced at the highest rate. Rates will differ for medical school residents, Medical College of Wisconsin faculty members, physicians practicing fewer than 500 hours in a fiscal year, and locum tenen physicians whose principal place of practice is not in Wisconsin.

Setting Fund Fees

Annual Fund premium rates are set by the Board of Governors with the approval of the state legislature. The fee-setting process begins with an actuarial assessment of expected loss exposure based on prior year experience. The other primary factor in determining annual fee adjustments is the overall financial position of the Fund. An actuarial consultant will perform analyses of the Fund’s loss experience and financial position and submit fee level recommendations to the Fund’s Actuarial and Underwriting Committee. After review, the committee will recommend a fee level increase or decrease to the Board of Governors, which may also alter the fee level. The Board of Governors then submits a proposed Fund fee administrative rule to the legislature for its approval.

Eligible nonphysician providers are assessed fees outside of the class structure. Factors driving these assessments include number of outpatient visits, number of hospital beds, number of employed physicians, CRNAs, or shareholders in an organization.

Fund Fees for Fiscal Year 2009 (July 1, 2008 - June 30, 2009)
Fund Fees for Fiscal Year 2010 (July 1, 2009 - June 30, 2010)

Billing Procedure

The Fund’s fiscal year runs from July 1 through June 30. The annual assessment is billed at the beginning of each fiscal year, or upon enrollment for mid-year entrants.

The fee is payable in either a lump sum total or on a quarterly installment basis. Billing statements are issued each quarter. If a provider elects to pay on an installment basis he or she must pay at least the minimum quarterly amount due. A quarterly administrative billing fee and interest on the deferred balance are assessed for any provider paying on an installment basis.

Administrative Fee Assessment/Interest

The balance of the account should be paid when the bill is received. In the event that the balance is not received at the Fund’s Milwaukee lockbox by the payment due date, an assessment of $3.00 per quarter is applied to the account.

Interest is also assessed on the outstanding account balance. Interest charges appear on the quarterly statement received subsequent to the period in which interest accrues.

Billing Statement Format

The format of the Fund’s billing statement is similar to a charge card statement. It includes the following information: account number; provider type (e.g., physician or surgeon, corporation, partnership, etc.); previous balance due (if applicable); debit and credit activity on the account since the previous bill; the date(s) and amount(s) of any payments recorded since the last bill; total balance due; minimum payment due; and the due date for remitting the minimum payment. An annually determined interest rate (1.587% for fiscal year 2010) will be assessed on any deferred balance. Interest charges appear on the bill subsequent to the period in which charges are incurred.

Financial Compliance/Noncompliance

Providers that do not pay the minimum amount due on the Fund's billing statement are in financial noncompliance. Actions taken by the Fund to achieve compliance include:

• Letters are sent by Fund staff to alert the provider to noncompliant status and to request immediate payment.

• If the provider fails to rectify his or her account balance, Fund staff will notify the Department of Regulation and Licensing (R&L) of noncompliant status.

Financial noncompliance letters are sent on the following time table:

• Bills are sent allowing 30 days for payment to reach the Fund
• A noncompliance letter is sent by first class mail on the first day after payment is due (day 31)
• A certified letter is sent 15 days later if payment not received (day 45)
• A letter is sent to Regulation & Licensing, giving notice of noncompliance if payment is not received within 30 days of the certified letter

Section Ins 17.28 (k), Wis. Adm. Code, provides: "A provider shall pay at least the minimum amount due on or before each due date. If the Fund received payment later than the due date specified in the late payment notice sent to the provider by certified mail, the Fund may not apply the payment retroactively to the annual fee unless the board has authorized retroactive coverage."

Group Billings

Many providers are covered under a group billing. The Fund sends a bill to the group administrator with each provider eligible for coverage listed on the billing, and requests the list be submitted with the total amount due for Fund coverage. One problem typically encountered is the elimination of providers from group coverage without an accompanying explanation for the elimination by the group administrator submitting the payment. This results in administrative and billing problems for the provider, the group administrator, and the Fund. It is therefore important for groups filing policies with the Fund to provide written explanation of all deletions from the Fund’s group billing statement.

For linkage questions, please contact Audrey Hawk at audrey.hawk@wisconsin.gov or (608) 266-6830.

Credit Balances

Occasionally, Fund billing statements will show a credit balance due to retirement, expiration of a primary malpractice insurance certificate, a provider class change, or nonrenewal or cancellation of a license. Billing statements in these instances read: "This is a credit. Do not pay." Please read your statement carefully prior to remitting payment.

Part-Time and Half-Time Practice

• Part-Time Provider

A provider may be eligible for coverage at a part-time rate if he or she practices fewer than 500 hours during the fiscal year. Practice must be limited to office practice and nursing home and house call, may not include obstetrics or surgery or assistance in surgical procedures. For fiscal year 2009-2010, the part-time rate is $310 plus the $25 mediation panel fee.

Many providers eligible for the part-time rate will practice between 240 and 500 hours because those practicing fewer than 240 hours qualify for an exemption from Fund coverage.

• Half-Time Provider

Effective July 1, 2006, there will be a new half-time provider type for those physicians practicing 1,040 hours or less per fiscal year. This half-time provider type does not include any of the restrictions that are in place for the part-time provider, which will remain in effect. Surgery, obstetrics, and hospital admitting privileges are all allowed under this classification.

These providers will receive a forty percent reduction to their Fund fees.

Moonlighting Residents

The Fund provides coverage for residents that practice outside of their training programs. All residents must purchase separate Fund coverage that will provide coverage for the hours of practice outside the scope of their residency.

It is important to distinguish between moonlighting residents and a part-time practice for Board-certified physicians. "Moonlighting" policies are only issued to residents acting within the scope of a residency or fellowship program. For board-certified physicians, there is no moonlighting rate; either a part-time or a full-time rate must be paid.

Locum Tenens

Locum tenens are physicians who are issued a temporary license to practice in Wisconsin. Fund malpractice coverage is required if the number of hours of practice for a fiscal year exceeds 240. It is the physician’s responsibility to obtain primary coverage. The primary insurer must ensure that a certificate of insurance is filed with the Fund for the period of locum tenens practice.

Many locum tenens will seek coverage for the period of practice in Wisconsin, regardless of the number of hours practiced. The Fund will bill accounts for partial year practice in two-week increments, days 1-14, and days 15-end of month. Any day in a half-month constitutes one-half month of practice for billing purposes. Fees are assessed at one half the full time rate for out-of-state providers.

A certificate termination must be filed with the Fund before refunds are processed. Refunds are issued approximately 45 days after the end of the quarter in which the certificate is terminated.

Refund of Payment

Providers seek refunds under a variety of circumstances. The most common instance of refund is when a provider claims an exemption during a fiscal year for which a certificate of primary insurance has been filed and payment has been received. For instance, a provider may move out of Wisconsin after having paid the quarterly or annual amount due for temporary work that does not extend for the full quarter or annual period. Another instance of refund is when a provider has changed specialty or Fund class. In these instances, the provider’s account will show a negative (credit) balance. The primary insurer will remit a new certificate with a new ISO code. Requests for refunds made without the new certificate or an exemption form will not be processed. Payment should not be rendered by the provider when the statement shows a credit balance.

In order to process a refund, a certificate for the period of practice must be filed with the Fund in addition to an exemption form covering the period of nonpractice. The Fund’s computer system issues refunds based on half-month (days 1-14 and 15-31; that is, and practice falling within these two periods constitutes a half-month for billing purposes).

Refunds are issued to the provider named on the account. If a third party is requesting that a refund be sent to them on a particular provider's account, the request must include a signed authorized statement from the provider authorizing such.

Claims Administration/Adjudication

The Fund contracts with a claims administrator for claims services to adjudicate claims, obtain legal representation, and to pay judgments or settlement awards.

The process can be outlined as follows:

1. The Fund is named in the suit by the plaintiff.
2. The Fund verifies whether the provider(s) named in the suit had Fund coverage at the time of the claim incident.
3. The claims contractor establishes claim files as necessary.
4. The claims contractor determines whether the Fund should be represented by separate counsel.
5. The claims contractor monitors the case progress of defense counsel.
6. The claim is either settled through negotiations with the plaintiff or is decided at trial.

Primary insurers have a duty to defend the Fund and their provider/insureds.

Board of Governors

Marilu Bintz, M.D., Wisconsin Hospital Association
Randy Blumer, Industry Representative
Dennis Conta, Public Member
Stan Davis, Public Member
Scott Froehlke, Public Member
Erik Huth, Industry Representative
Robert Jaeger, M.D., Wisconsin Medical Society
James Jansen, Wisconsin Association for Justice
Reid Olson, M.D., Public Member
Christopher Spencer, Industry Representative
Susan Turney, M.D., Wisconsin Medical Society
John Walsh, State Bar of Wisconsin