Read the full stored bill text
HOUSE BILL No. 2509
AN ACT concerning health and health professions; relating to physical therapists; allowing
licensed physical therapists to perform certain capillary blood tests; relating to the
healthcare provider insurance availability act; adding advanced practice registered
nurse to the definition of healthcare provider; adding an advanced practice registered
nurse position to the board of governors of the healthcare stabilization fund; requiring
advance practice registered nurses to maintain professional liability insurance as a
condition of active licensure; amending K.S.A. 40-3402 and 40-3403 and K.S.A.
2025 Supp. 40-3401 and repealing the existing sections.
Be it enacted by the Legislature of the State of Kansas:
New Section 1. (a) For the purposes of this section, "point-of-care
testing" means laboratory-based capillary assays. "Point-of-care
testing" does not include point-of-care ultrasound or other imaging
modalities and venipuncture or other procedures requiring vascular
access beyond the use of a fingerstick or other capillary methods.
(b) Physical therapists may perform point-of-care laboratory
testing limited to assays classified by the centers for medicare and
medicaid services as CLIA-waived tests. Permitted tests include lactate
and blood glucose if used for the purpose of obtaining information
related to muscle metabolism, exercise tolerance or rehabilitation
status. Such testing shall not include the diagnostic use of point-of-care
testing for medical conditions outside the scope of physical therapy
practice.
(c) A physical therapist or the facility where testing is performed
shall obtain and maintain a CLIA certificate of waiver in accordance
with federal law. Testing shall be performed only in accordance with
manufacturer instructions, including training requirements for staff
performing such tests.
(d) Results of point-of-care testing shall be used as adjunct
information to support physical therapy evaluation and treatment
planning or to comply with a physician's order.
(e) Point-of-care laboratory testing by physical therapists shall not
be construed as granting independent authority to diagnose medical
conditions.
(f) Physical therapists shall not bill third-party payers for point-of-
care laboratory testing as stand-alone reimbursable services. Nothing in
this section shall prohibit a physical therapist or facility from charging
a patient for the reasonable cost of testing supplies used in connection
with such testing.
(g) A physical therapist shall not perform point-of-care testing
unless a patient or the patient's representative provides written consent.
Written consent shall include:
(1) Disclosure of costs to the patient or the patient's representative;
and
(2) an acknowledgment of financial responsibility from the patient
or the patient's representative.
Sec. 2. K.S.A. 2025 Supp. 40-3401 is hereby amended to read as
follows: 40-3401. As used in this act:
(a) "Applicant" means any healthcare provider.
(b) "Basic coverage" means a policy of professional liability
insurance required to be maintained by each healthcare provider
pursuant to the provisions of K.S.A. 40-3402(a) or (b), and
amendments thereto.
(c) "Commissioner" means the commissioner of insurance.
(d) "Fiscal year" means the year commencing on the effective date
of this act and each year, commencing on the first day of July
thereafter.
(e) "Fund" means the healthcare stabilization fund established
pursuant to K.S.A. 40-3403(a), and amendments thereto.
(f) (1) "Healthcare provider" means a:
(A) Person licensed to practice any branch of the healing arts by
the state board of healing arts;
(B) person who holds a temporary permit to practice any branch of
the healing arts issued by the state board of healing arts;
(C) person engaged in a postgraduate training program approved
HOUSE BILL No. 2509—page 2
by the state board of healing arts;
(D) medical care facility licensed by the state of Kansas;
(E) podiatrist licensed by the state board of healing arts;
(F) health maintenance organization that has been issued a
certificate of authority by the commissioner;
(G) optometrist licensed by the board of examiners in optometry;
(H) pharmacist licensed by the state board of pharmacy;
(I) licensed professional nurse who is authorized to practice as a
registered nurse anesthetist;
(J) licensed professional nurse who has been granted a temporary
authorization to practice nurse anesthesia under K.S.A. 65-1153, and
amendments thereto;
(K) professional corporation organized pursuant to the
professional corporation law of Kansas by persons who are authorized
by such law to form such a corporation and are healthcare providers as
defined by this subsection;
(L) Kansas limited liability company organized for the purpose of
rendering professional services by its members who are healthcare
providers as defined by this subsection and legally authorized to render
the professional services for which the limited liability company is
organized;
(M) partnership of persons who are healthcare providers under this
subsection;
(N) Kansas not-for-profit nonprofit corporation organized for the
purpose of rendering professional services by persons who are
healthcare providers as defined by this subsection;
(O) nonprofit corporation organized to administer the graduate
medical education programs of community hospitals or medical care
facilities affiliated with the university of Kansas school of medicine;
(P) dentist certified by the state board of healing arts to administer
anesthetics under K.S.A. 65-2899, and amendments thereto;
(Q) psychiatric hospital licensed prior to January 1, 1988, and
continuously thereafter under K.S.A. 2015 Supp. 75-3307b, prior to its
repeal, and K.S.A. 39-2001 et seq., and amendments thereto, or a
mental health center or mental health clinic licensed by the state of
Kansas;
(R) physician assistant licensed by the state board of healing arts;
(S) licensed advanced practice registered nurse who is authorized
by the board of nursing to practice as an advanced practice registered
nurse in the classification of a nurse-midwife;
(T) maternity center, if such maternity center has been granted
accreditation by the commission for accreditation of birth centers and is
a maternity center as defined in K.S.A. 65-503, and amendments
thereto;
(U) licensed advanced practice registered nurse who has been
granted a temporary authorization by the board of nursing to practice as
an advanced practice registered nurse in the classification of a nurse-
midwife;
(V) nursing facility licensed by the state of Kansas;
(W) assisted living facility licensed by the state of Kansas; or
(X) a residential healthcare facility licensed by the state of
Kansas;
(Y) commencing on and after January 1, 2028 , any advanced
practice registered nurse licensed or granted a temporary
authorization by the board of nursing to practice as an advanced
practice nurse . Any such advanced practice registered nurse shall be
granted six months to comply with membership requirements.
(2) "Healthcare provider" does not include:
(A) Any state institution for people with intellectual disability;
(B) any state psychiatric hospital;
(C) any person holding an exempt license issued by the state board
of healing arts or the board of nursing;
(D) any person holding a visiting clinical professor license from
the state board of healing arts;
HOUSE BILL No. 2509—page 3
(E) any person holding an inactive license issued by the state
board of healing arts;
(F) any person holding a federally active license issued by the
state board of healing arts;
(G) an advanced practice registered nurse who is authorized by the
board of nursing to practice as an advanced practice registered nurse in
the classification of nurse-midwife or nurse anesthetist and who
practices solely in the course of employment or active duty in the
United States government or any of its departments, bureaus or
agencies or provides professional services as a charitable healthcare
provider as defined under K.S.A. 75-6102, and amendments thereto; or
(H) a physician assistant licensed by the state board of healing arts
who practices solely in the course of employment or active duty in the
United States government or any of its departments, bureaus or
agencies or provides professional services as a charitable healthcare
provider as defined under K.S.A. 75-6102, and amendments thereto.
(g) "Inactive healthcare provider" means a person or other entity
who purchased basic coverage or qualified as a self-insurer on or
subsequent to the effective date of this act but who, at the time a claim
is made for personal injury or death arising out of the rendering of or
the failure to render professional services by such healthcare provider,
does not have basic coverage or self-insurance in effect solely because
such person is no longer engaged in rendering professional service as a
healthcare provider.
(h) "Insurer" means any corporation, association, reciprocal
exchange, inter-insurer and any other legal entity authorized to write
bodily injury or property damage liability insurance in this state,
including workers compensation and automobile liability insurance,
pursuant to the provisions of the acts contained in article 9, 11, 12 or 16
of chapter 40 of the Kansas Statutes Annotated, and amendments
thereto.
(i) "Plan" means the operating and administrative rules and
procedures developed by insurers and rating organizations or the
commissioner to make professional liability insurance available to
healthcare providers.
(j) "Professional liability insurance" means insurance providing
coverage for legal liability arising out of the performance of
professional services rendered or that should have been rendered by a
healthcare provider.
(k) "Rating organization" means a corporation, an unincorporated
association, a partnership or an individual licensed pursuant to K.S.A.
40-956, and amendments thereto, to make rates for professional
liability insurance.
(l) "Self-insurer" means a healthcare provider who qualifies as a
self-insurer pursuant to K.S.A. 40-3414, and amendments thereto.
(m) "Medical care facility," means the same when used in the
healthcare provider insurance availability act , means the same as
defined in K.S.A. 65-425, and amendments thereto, except that, as used
in the healthcare provider insurance availability act, such term
"medical care facility," as it relates to insurance coverage under the
healthcare provider insurance availability act, also includes any
director, trustee, officer or administrator of a medical care facility.
(n) "Mental health center" means a mental health center licensed
by the state of Kansas under K.S.A. 39-2001 et seq., and amendments
thereto, except that, as used in the healthcare provider insurance
availability act, such term "mental health center," as it relates to
insurance coverage under the healthcare provider insurance availability
act, also includes any director, trustee, officer or administrator of a
mental health center.
(o) "Mental health clinic" means a mental health clinic licensed by
the state of Kansas under K.S.A. 39-2001 et seq., and amendments
thereto, except that, as used in the healthcare provider insurance
availability act, such term "mental health clinic," as it relates to
insurance coverage under the healthcare provider insurance availability
HOUSE BILL No. 2509—page 4
act, also includes any director, trustee, officer or administrator of a
mental health clinic.
(p) "State institution for people with intellectual disability" means
Parsons state hospital and the Kansas neurological institute.
(q) "State psychiatric hospital" means Larned state hospital,
Osawatomie state hospital and south central regional mental health
hospital.
(r) "Person engaged in residency training" means:
(1) A person engaged in a postgraduate training program approved
by the state board of healing arts who is employed by and is studying at
the university of Kansas medical center but only when if such person is
engaged in medical activities that do not include extracurricular, extra-
institutional medical service for which such person receives extra
compensation and that have not been approved by the dean of the
school of medicine and the executive vice-chancellor of the university
of Kansas medical center. Persons engaged in residency training shall
be considered resident healthcare providers for purposes of K.S.A. 40-
3401 et seq., and amendments thereto; and
(2) a person engaged in a postgraduate training program approved
by the state board of healing arts who is employed by a nonprofit
corporation organized to administer the graduate medical education
programs of community hospitals or medical care facilities affiliated
with the university of Kansas school of medicine or who is employed
by an affiliate of the university of Kansas school of medicine as defined
in K.S.A. 76-367, and amendments thereto, but only when if such
person is engaged in medical activities that do not include
extracurricular, extra-institutional medical service for which such
person receives extra compensation and that have not been approved by
the chief operating officer of the nonprofit corporation or the chief
operating officer of the affiliate and the executive vice-chancellor vice
chancellor of the university of Kansas medical center.
(s) "Full-time physician faculty employed by the university of
Kansas medical center" means a person licensed to practice medicine
and surgery who holds a full-time appointment at the university of
Kansas medical center when such person is providing healthcare. A
person licensed to practice medicine and surgery who holds a full-time
appointment at the university of Kansas medical center may also be
employed part-time part time by the United States department of
veterans affairs if such employment is approved by the executive vice-
chancellor vice chancellor of the university of Kansas medical center.
(t) "Sexual act" or "sexual activity" means sexual conduct that
constitutes a criminal or tortious act under the laws of the state of
Kansas.
(u) "Board" means the board of governors created by K.S.A. 40-
3403, and amendments thereto.
(v) "Board of directors" means the governing board created by
K.S.A. 40-3413, and amendments thereto.
(w) "Locum tenens contract" means a temporary agreement not
exceeding 182 days per calendar year that employs a healthcare
provider to actively render professional services in this state.
(x) "Professional services" means patient care or other services
authorized under the act governing licensure of a healthcare provider.
(y) "Healthcare facility" means a nursing facility, an assisted
living facility or a residential healthcare facility as all such terms are
defined in K.S.A. 39-923, and amendments thereto.
(z) "Charitable healthcare provider" means the same as defined in
K.S.A. 75-6102, and amendments thereto.
Sec. 3. K.S.A. 40-3402 is hereby amended to read as follows: 40-
3402. (a) Prior to January 1, 2022, a policy of professional liability
insurance approved by the commissioner and issued by an insurer duly
authorized to transact business in this state in which the limit of the
insurer's liability is not less than $200,000 per claim, subject to not less
than a $600,000 annual aggregate for all claims made during the policy
period, shall be maintained in effect by each resident healthcare
HOUSE BILL No. 2509—page 5
provider as a condition of active licensure or other statutory
authorization to render professional service as a healthcare provider in
this state, unless such healthcare provider is a self-insurer. For all new
policies and policies that renew on and after January 1, 2022, a policy
of professional liability insurance approved by the commissioner and
issued by an insurer duly authorized to transact business in this state in
which the limit of the insurer's liability is not less than $500,000 per
claim, subject to not less than a $1,500,000 annual aggregate for all
claims made during the policy period, shall be maintained by each
resident healthcare provider as a condition of active licensure or other
statutory authorization to render professional service as a healthcare
provider in this state, unless such healthcare provider is a self-insurer.
This provision shall not apply to optometrists and pharmacists on and
after July 1, 1991, to physical therapists on and after July 1, 1995, or to
health maintenance organizations on and after July 1, 1997. Such
policy shall provide as a minimum coverage for claims made during the
term of the policy that were incurred during the term of such policy or
during the prior term of a similar policy. This provision shall apply to
advanced practice register nurses on and after January 1, 2028, except
as provided in subsection (f). Any insurer offering such policy of
professional liability insurance to any healthcare provider may offer to
such healthcare provider a policy as prescribed in this section with
deductible options. Such deductible shall be within such policy limits.
(1) Each insurer providing basic coverage shall, within 30 days
after the effective date of any policy issued in accordance with this
subsection, notify the board of governors that such coverage is or will
be in effect. Such notification shall be on a form approved by the board
of governors and shall include information identifying the professional
liability policy issued or to be issued, the name and address of all
healthcare providers covered by the policy, the amount of the annual
premium, the effective and expiration dates of the coverage and such
other information as the board of governors shall require. A copy of the
notice required by this subsection shall be furnished to the named
insured.
(2) In the event of termination of basic coverage by cancellation,
nonrenewal, expiration or otherwise by either the insurer or named
insured, notice of such termination shall be furnished by the insurer to
the board of governors, the state agency which licenses, registers or
certifies the named insured and the named insured. Such notice shall be
provided no less than 30 days prior to the effective date of any
termination initiated by the insurer or within 10 business days after the
date coverage is terminated at the request of the named insured and
shall include the name and address of the healthcare provider or
providers for whom basic coverage is terminated and the date basic
coverage will cease to be in effect. No basic coverage shall be
terminated by cancellation or failure to renew by the insurer unless
such insurer provides a notice of termination as required by this
subsection.
(3) Any professional liability insurance policy issued, delivered or
in effect in this state on and after July 1, 1976, shall contain or be
endorsed to provide basic coverage as required by subsection (a).
Notwithstanding any omitted or inconsistent language, any contract of
professional liability insurance shall be construed to obligate the insurer
to meet all the mandatory requirements and obligations of this act. The
liability of an insurer for claims made prior to July 1, 1984, shall not
exceed those limits of insurance provided by such policy prior to July
1, 1984.
(b) A nonresident healthcare provider shall not be licensed to
actively render professional service as a healthcare provider in this state
unless such healthcare provider maintains continuous coverage in effect
as prescribed by subsection (a), except such coverage may be provided
by a nonadmitted insurer who has filed the form required by subsection
(b)(1). This provision shall not apply to optometrists and pharmacists
on and after July 1, 1991, or to physical therapists on and after July 1,
HOUSE BILL No. 2509—page 6
1995.
(1) Every insurance company authorized to transact business in
this state, that is authorized to issue professional liability insurance in
any jurisdiction, shall file with the commissioner, as a condition of its
continued transaction of business within this state, a form prescribed by
the commissioner declaring that its professional liability insurance
policies, wherever issued, shall be deemed to provide at least the
insurance required by this subsection when the insured is rendering
professional services as a nonresident healthcare provider in this state.
Any nonadmitted insurer may file such a form.
(2) Every nonresident healthcare provider that is required to
maintain basic coverage pursuant to this subsection shall pay the
surcharge levied by the board of governors pursuant to K.S.A. 40-
3404(a), and amendments thereto, directly to the board of governors
and shall furnish to the board of governors the information required in
subsection (a)(1).
(c) Every healthcare provider that is a self-insurer, the university
of Kansas medical center for persons engaged in residency training, as
described in K.S.A. 40-3401(r)(1), and amendments thereto, the
employers of persons engaged in residency training, as described in
K.S.A. 40-3401(r)(2), and amendments thereto, the private practice
corporations or foundations and their full-time physician faculty
employed by the university of Kansas medical center or a medical care
facility or mental health center for self-insurers under K.S.A. 40-
3414(e), and amendments thereto, shall pay the surcharge levied by the
board of governors pursuant to K.S.A. 40-3404(a), and amendments
thereto, directly to the board of governors and shall furnish to the board
of governors the information required in subsections (a)(1) and (a)(2).
(d) In lieu of a claims made policy otherwise required under this
section, a person engaged in residency training who is providing
services as a healthcare provider but, while providing such services, is
not covered by the self-insurance provisions of K.S.A. 40-3414(d), and
amendments thereto, may obtain basic coverage under an occurrence
form policy, if such policy provides professional liability insurance
coverage and limits that are substantially the same as the professional
liability insurance coverage and limits required by K.S.A. 40-3402(a),
and amendments thereto. Where such occurrence form policy is in
effect, the provisions of the healthcare provider insurance availability
act referring to claims made policies shall be construed to mean
occurrence form policies.
(e) In lieu of a claims made policy otherwise required under this
section, a nonresident healthcare provider employed pursuant to a
locum tenens contract to provide services in this state as a healthcare
provider may obtain basic coverage under an occurrence form policy, if
such policy provides professional liability insurance coverage and
limits that are substantially the same as the professional liability
insurance coverage and limits required by K.S.A. 40-3402, and
amendments thereto. Where such occurrence form policy is in effect,
the provisions of the healthcare provider insurance availability act
referring to claims made policies shall be construed to mean occurrence
form policies.
(f) An advanced practice registered nurse shall not be subject to
the requirements of subsection (a) if the initial surcharge to participate
in the healthcare stabilization fund exceeds 15%.
Sec. 4. K.S.A. 40-3403 is hereby amended to read as follows: 40-
3403. (a) For the purpose of paying damages for personal injury or
death arising out of the rendering of or the failure to render professional
services by a healthcare provider, self-insurer or inactive health care
provider subsequent to the time that such healthcare provider or self-
insurer has qualified for coverage under the provisions of this act, there
is hereby established the healthcare stabilization fund. The fund shall
be held in trust in the state treasury and accounted for separately from
other state funds. The board of governors shall administer the fund or
contract for the administration of the fund with an insurance company
HOUSE BILL No. 2509—page 7
authorized to do business in this state.
(b) (1) There is hereby created a board of governors that shall be
composed of such members and shall have such powers, duties and
functions as are prescribed by this act. The board of governors shall:
(A) Administer the fund and exercise and perform other powers,
duties and functions required of the board under the healthcare provider
insurance availability act;
(B) provide advice, information and testimony to the appropriate
licensing or disciplinary authority regarding the qualifications of a
healthcare provider;
(C) prepare and publish, on or before October 1 of each year, a
report for submission to the healthcare stabilization fund oversight
committee that includes a summary of the fund's activity during the
preceding fiscal year, including, but not limited to, the amount
collected from surcharges, the highest and lowest surcharges assessed,
the amount paid from the fund, the number of judgments paid from the
fund, the number of settlements paid from the fund and the fund
balance at the end of the fiscal year; and
(D) have the authority to grant temporary exemptions from the
provisions of K.S.A. 40-3402 and 40-3404, and amendments thereto, to
healthcare providers who have exceptional circumstances and verify in
writing that the healthcare provider will not render professional
services in this state during the period of exemption. Whenever the
board grants such an exemption, the board shall notify the state agency
that licenses the exempted healthcare provider.
(2) The board shall consist of 11 12 persons appointed by the
commissioner of insurance, as provided by this subsection and as
follows:
(A) Three members who are on a list of nominees submitted to the
commissioner by the Kansas medical society, at least two of whom are
doctors of medicine who are licensed to practice medicine and surgery
in Kansas;
(B) three members who are on a list of nominees submitted to the
commissioner by the Kansas hospital association and who are
representatives of Kansas hospitals;
(C) two members who are on a list of nominees submitted to the
commissioner by the Kansas association of osteopathic medicine, who
are licensed to practice medicine and surgery in Kansas and who are
doctors of osteopathic medicine;
(D) one member who is on a list of nominees submitted to the
commissioner by the Kansas chiropractic association and who is
licensed to practice chiropractic in Kansas;
(E) one member who is on a list of nominees submitted to the
commissioner by the Kansas association of nurse anesthetists and who
is a licensed professional nurse authorized to practice as a registered
nurse anesthetist; and
(F) one member who is on a list of nominees submitted to the
commissioner by statewide associations comprised of members who
represent adult care homes and who is a representative of adult care
homes; and
(G) one member who is on a list of nominees approved by the
Kansas board of nursing and who is an advanced practice registered
nurse as defined in K.S.A. 65-1113, and amendments thereto.
(3) When a vacancy occurs in the membership of the board of
governors created by this act, the commissioner shall appoint a
successor of like qualifications from a list of three nominees submitted
to the commissioner by the professional society or , association ,
alliance or academy prescribed by this section for the category of
healthcare provider required for the vacant position on the board of
governors. All appointments made shall be for a term of office of four
years, but no member shall be appointed for more than two successive
four-year terms. Each member shall serve until a successor is appointed
and qualified. Whenever a vacancy occurs in the membership of the
board of governors created by this act for any reason other than the
HOUSE BILL No. 2509—page 8
expiration of a member's term of office, the commissioner shall appoint
a successor of like qualifications to fill the unexpired term. In each case
of a vacancy occurring in the membership of the board of governors,
the commissioner shall notify the professional society or association
that represents the category of healthcare provider required for the
vacant position and request a list of three nominations of healthcare
providers from which to make the appointment.
(4) The board of governors shall organize in July of each year and
shall elect a chairperson and vice-chairperson from among its
membership. Meetings shall be called by the chairperson or by a
written notice signed by three members of the board.
(5) The board of governors, in addition to other duties imposed by
this act, shall study and evaluate the operation of the fund and make
such recommendations to the legislature as may be appropriate to
ensure the viability of the fund.
(6) (A) The board shall appoint an executive director who shall be
in the unclassified service under the Kansas civil service act and may
employ attorneys and other employees who shall also be in the
unclassified service under the Kansas civil service act. Such executive
director, attorneys and other employees shall receive compensation
fixed by the board, in accordance with appropriation acts of the
legislature, not subject to approval of the governor.
(B) The board may provide all office space, services, equipment,
materials and supplies, and all budgeting, personnel, purchasing and
related management functions required by the board in the exercise of
the powers, duties and functions imposed or authorized by the
healthcare provider insurance availability act or may enter into a
contract with the commissioner of insurance for the provision, by the
commissioner, of all or any part thereof.
(7) The commissioner shall:
(A) Provide technical and administrative assistance to the board of
governors with respect to administration of the fund upon request of the
board; and
(B) provide such expertise as the board may reasonably request
with respect to evaluation of claims or potential claims.
(c) Except as otherwise provided by any other provision of this
act, the fund shall be liable to pay:
(1) Any amount due from a judgment or settlement that is in
excess of the basic coverage liability of all liable resident healthcare
providers or resident self-insurers for any personal injury or death
arising out of the rendering of or the failure to render professional
services within or without this state;
(2) subject to the provisions of subsection (f), any amount due
from a judgment or settlement that is in excess of the basic coverage
liability of all liable nonresident healthcare providers or nonresident
self-insurers for any such injury or death arising out of the rendering or
the failure to render professional services within this state but in no
event shall the fund be obligated for claims against nonresident
healthcare providers or nonresident self-insurers who have not
complied with this act or for claims against nonresident healthcare
providers or nonresident self-insurers that arose outside of this state;
(3) subject to the provisions of subsection (f), any amount due
from a judgment or settlement against a resident inactive healthcare
provider for any such injury or death arising out of the rendering of or
failure to render professional services;
(4) subject to the provisions of subsection (f), any amount due
from a judgment or settlement against a nonresident inactive healthcare
provider for any injury or death arising out of the rendering or failure to
render professional services within this state, but in no event shall the
fund be obligated for claims against nonresident inactive healthcare
providers:
(A) Who have not complied with this act; or
(B) for claims that arose outside of this state, unless such
healthcare provider was a resident healthcare provider or resident self-
HOUSE BILL No. 2509—page 9
insurer at the time such act occurred;
(5) subject to K.S.A. 40-3411(b), and amendments thereto,
reasonable and necessary expenses for attorney fees, depositions,
expert witnesses and other costs incurred in defending the fund against
claims, and such expenditures shall not be subject to the provisions of
K.S.A. 75-3738 through 75-3744, and amendments thereto;
(6) any amounts expended for reinsurance obtained to protect the
best interests of the fund purchased by the board of governors, which
purchase shall be subject to the provisions of K.S.A. 75-3738 through
75-3744, and amendments thereto, but shall not be subject to the
provisions of K.S.A. 75-4101, and amendments thereto;
(7) reasonable and necessary actuarial expenses incurred in
administering the act, including expenses for any actuarial studies
contracted for by the legislative coordinating council, and such
expenditures shall not be subject to the provisions of K.S.A. 75-3738
through 75-3744, and amendments thereto;
(8) periodically to the plan or plans, any amount due pursuant to
K.S.A. 40-3413(a)(3), and amendments thereto;
(9) reasonable and necessary expenses incurred by the board of
governors in the administration of the fund or in the performance of
other powers, duties or functions of the board under the healthcare
provider insurance availability act;
(10) surcharge refunds payable when the notice of cancellation
requirements of K.S.A. 40-3402, and amendments thereto, are met;
(11) subject to K.S.A. 40-3411(b), and amendments thereto,
reasonable and necessary expenses for attorney fees and other costs
incurred in defending a person engaged or who was engaged in
residency training or the private practice corporations or foundations
and their full-time physician faculty employed by the university of
Kansas medical center or any nonprofit corporation organized to
administer the graduate medical education programs of community
hospitals or medical care facilities affiliated with the university of
Kansas school of medicine from claims for personal injury or death
arising out of the rendering of or the failure to render professional
services by such healthcare provider;
(12) any amount due from a judgment or settlement for an injury
or death arising out of the rendering of or failure to render professional
services by a person engaged or who was engaged in residency training
or the private practice corporations or foundations and their full-time
physician faculty employed by the university of Kansas medical center
or any nonprofit corporation organized to administer the graduate
medical education programs of community hospitals or medical care
facilities affiliated with the university of Kansas school of medicine;
(13) subject to the provisions of K.S.A. 65-429, and amendments
thereto, reasonable and necessary expenses for the development and
promotion of risk management education programs and for the medical
care facility licensure and risk management survey functions carried
out under K.S.A. 65-429, and amendments thereto;
(14) any amount, but not less than the required basic coverage
limits, owed pursuant to a judgment or settlement for any injury or
death arising out of the rendering of or failure to render professional
services by a person, other than a person described in paragraph (12),
who was engaged in a postgraduate program of residency training
approved by the state board of healing arts but who, at the time the
claim was made, was no longer engaged in such residency program;
(15) subject to K.S.A. 40-3411(b), and amendments thereto,
reasonable and necessary expenses for attorney fees and other costs
incurred in defending a person described in paragraph (14);
(16) expenses incurred by the commissioner in the performance of
duties and functions imposed upon the commissioner by the healthcare
provider insurance availability act, and expenses incurred by the
commissioner in the performance of duties and functions under
contracts entered into between the board and the commissioner as
authorized by this section; and
HOUSE BILL No. 2509—page 10
(17) periodically to the state general fund reimbursements of
amounts paid to members of the healthcare stabilization fund oversight
committee for compensation, travel expenses and subsistence expenses
pursuant to K.S.A. 40-3403b(e), and amendments thereto.
(d) All amounts for which the fund is liable pursuant to subsection
(c) shall be paid promptly and in full except that, if the amount for
which the fund is liable is $500,000 or more, it shall be paid by
installment payments of $500,000 or 10% of the amount of the
judgment including interest thereon, whichever is greater, per fiscal
year, the first installment to be paid within 60 days after the fund
becomes liable and each subsequent installment to be paid annually on
the same date of the year the first installment was paid, until the claim
has been paid in full.
(e) In no event shall the fund be liable to pay in excess of
$3,000,000 pursuant to any one judgment or settlement against any one
healthcare provider relating to any injury or death arising out of the
rendering of or the failure to render professional services on and after
July 1, 1984, and before July 1, 1989, subject to an aggregate limitation
for all judgments or settlements arising from all claims made in any one
fiscal year in the amount of $6,000,000 for each healthcare provider.
(f) In no event shall the fund be liable to pay in excess of the
amounts specified in the option selected by an active or inactive
healthcare provider pursuant to subsection (l) for judgments or
settlements relating to injury or death arising out of the rendering of or
failure to render professional services by such healthcare provider on or
after July 1, 1989.
(g) A healthcare provider shall be deemed to have qualified for
coverage under the fund:
(1) On and after July 1, 1976, if basic coverage is then in effect;
(2) subsequent to July 1, 1976, at such time as basic coverage
becomes effective; or
(3) upon qualifying as a self-insurer pursuant to K.S.A. 40-3414,
and amendments thereto.
(h) A healthcare provider who is qualified for coverage under the
fund shall have no vicarious liability or responsibility for any injury or
death arising out of the rendering of or the failure to render professional
services inside or outside this state by any other healthcare provider
who is also qualified for coverage under the fund. The provisions of
this subsection shall apply to all claims filed on or after July 1, 1986.
(i) Notwithstanding the provisions of K.S.A. 40-3402, and
amendments thereto, if the board of governors determines due to the
number of claims filed against a healthcare provider or the outcome of
those claims that an individual healthcare provider presents a material
risk of significant future liability to the fund, the board of governors is
authorized by a vote of a majority of the members thereof, after notice
and an opportunity for hearing in accordance with the provisions of the
Kansas administrative procedure act, to terminate the liability of the
fund for all claims against the healthcare provider for damages for
death or personal injury arising out of the rendering of or the failure to
render professional services after the date of termination. The date of
termination shall be 30 days after the date of the determination by the
board of governors. The board of governors, upon termination of the
liability of the fund under this subsection, shall notify the licensing or
other disciplinary board having jurisdiction over the healthcare
provider involved of the name of the healthcare provider and the
reasons for the termination.
(j) (1) Subject to the provisions of paragraph (7), upon the
payment of moneys from the healthcare stabilization fund pursuant to
subsection (c)(11), the board of governors shall certify to the secretary
of administration the amount of such payment, and the secretary of
administration shall transfer an amount equal to the amount certified,
reduced by any amount transferred pursuant to paragraph (3) or (4),
from the state general fund to the healthcare stabilization fund.
(2) Subject to the provisions of paragraph (7), upon the payment
HOUSE BILL No. 2509—page 11
of moneys from the healthcare stabilization fund pursuant to subsection
(c)(12), the board of governors shall certify to the secretary of
administration the amount of such payment that is equal to the basic
coverage liability of self-insurers, and the secretary of administration
shall transfer an amount equal to the amount certified, reduced by any
amount transferred pursuant to paragraph (3) or (4), from the state
general fund to the healthcare stabilization fund.
(3) The university of Kansas medical center private practice
foundation reserve fund is hereby established in the state treasury. If the
balance in such reserve fund is less than $500,000 on July 1 of any
year, the private practice corporations or foundations referred to in
K.S.A. 40- 3402(c), and amendments thereto, shall remit the amount
necessary to increase such balance to $500,000 to the state treasurer for
credit to such reserve fund as soon after such July 1 date as is
practicable. Upon receipt of each such remittance, the state treasurer
shall credit the same to such reserve fund. When compliance with the
foregoing provisions of this paragraph have been achieved on or after
July 1 of any year in which the same are applicable, the state treasurer
shall certify to the board of governors that such reserve fund has been
funded for the year in the manner required by law. Moneys in such
reserve fund may be invested or reinvested in accordance with the
provisions of K.S.A. 40-3406, and amendments thereto, and any
income or interest earned by such investments shall be credited to such
reserve fund. Upon payment of moneys from the healthcare
stabilization fund pursuant to subsection (c)(11) or (c)(12) with respect
to any private practice corporation or foundation or any of its full- time
physician faculty employed by the university of Kansas, the secretary
of administration shall transfer an amount equal to the amount paid
from the university of Kansas medical center private practice
foundation reserve fund to the healthcare stabilization fund or, if the
balance in such reserve fund is less than the amount so paid, an amount
equal to the balance in such reserve fund.
(4) The graduate medical education administration reserve fund is
hereby established in the state treasury. If the balance in such reserve
fund is less than $40,000 on July 1 of any year, the nonprofit
corporations organized to administer the graduate medical education
programs of community hospitals or medical care facilities affiliated
with the university of Kansas school of medicine shall remit the amount
necessary to increase such balance to $40,000 to the state treasurer for
credit to such reserve fund as soon after such July 1 date as is
practicable. Upon receipt of each such remittance, the state treasurer
shall credit the same to such reserve fund. When compliance with the
foregoing provisions of this paragraph have been achieved on or after
July 1 of any year in which the same are applicable, the state treasurer
shall certify to the board of governors that such reserve fund has been
funded for the year in the manner required by law. Moneys in such
reserve fund may be invested or reinvested in accordance with the
provisions of K.S.A. 40-3406, and amendments thereto, and any
income or interest earned by such investments shall be credited to such
reserve fund. Upon payment of moneys from the healthcare
stabilization fund pursuant to subsection (c)(11) or (c)(12) with respect
to any nonprofit corporations organized to administer the graduate
medical education programs of community hospitals or medical care
facilities affiliated with the university of Kansas school of medicine the
secretary of administration shall transfer an amount equal to the amount
paid from the graduate medical education administration reserve fund
to the healthcare stabilization fund or, if the balance in such reserve
fund is less than the amount so paid, an amount equal to the balance in
such reserve fund.
(5) Upon payment of moneys from the healthcare stabilization
fund pursuant to subsection (c)(14) or (c)(15), the board of governors
shall certify to the secretary of administration the amount of such
payment, and the secretary of administration shall transfer an amount
equal to the amount certified from the state general fund to the
HOUSE BILL No. 2509—page 12
healthcare stabilization fund.
(6) Transfers from the state general fund to the healthcare
stabilization fund pursuant to this subsection shall not be subject to the
provisions of K.S.A. 75-3722, and amendments thereto.
(7) The funds required to be transferred from the state general
fund to the healthcare stabilization fund pursuant to paragraphs (1) and
(2) for the fiscal years ending June 30, 2010, June 30, 2011, June 30,
2012, and June 30, 2013, shall not be transferred prior to July 1, 2013.
The secretary of administration shall maintain a record of the amounts
certified by the board of governors pursuant to paragraphs (1) and (2)
for the fiscal years ending June 30, 2010, June 30, 2011, June 30, 2012,
and June 30, 2013. Beginning July 1, 2013, in addition to any other
transfers required pursuant to subsection (j), the state general fund
transfers that are deferred pursuant to this paragraph shall be
transferred from the state general fund to the healthcare stabilization
fund in the following manner: On July 1, 2013, and annually thereafter
through July 1, 2018, an amount equal to 20% of the total amount of
state general fund transfers deferred pursuant to this paragraph for the
fiscal years ending June 30, 2010, June 30, 2011, June 30, 2012, and
June 30, 2013. The amounts deferred pursuant to this paragraph shall
not accrue interest thereon.
(k) Notwithstanding any other provision of the healthcare provider
insurance availability act, no psychiatric hospital licensed under K.S.A.
39-2001 et seq., and amendments thereto, shall be assessed a premium
surcharge or be entitled to coverage under the fund if such hospital has
not paid any premium surcharge pursuant to K.S.A. 40-3404, and
amendments thereto, prior to January 1, 1988.
(l) (1) On or after July 1, 1989, and prior to January 1, 2022, every
healthcare provider shall make an election to be covered by one of the
following options provided in subparagraph (A) that shall limit the
liability of the fund with respect to judgments or settlements relating to
injury or death arising out of the rendering of or failure to render
professional services on or after July 1, 1989. On and after January 1,
2022, every healthcare provider shall make an election to be covered by
one of the following options provided in subparagraph (B) that shall
limit the liability of the fund with respect to judgments or settlements
relating to injury or death arising out of the rendering of or failure to
render professional services on or after January 1, 2022. Such election
shall be made at the time the healthcare provider renews the basic
coverage, or, if basic coverage is not in effect, such election shall be
made at the time such coverage is acquired pursuant to K.S.A. 40-3402,
and amendments thereto. A medical care facility or a healthcare facility
deemed qualified as a self-insurer under K.S.A. 40-3414(a), and
amendments thereto, may opt out of the requirements set forth in
subparagraph (B) if such medical care facility or healthcare facility
substantially meets the minimum coverage requirements of this section
through coverage provided by the captive insurance company of such
medical care facility or healthcare facility. Notice of the election shall
be provided by the insurer providing the basic coverage in the manner
and form prescribed by the board of governors and shall continue to be
effective from year to year unless modified by a subsequent election
made prior to the anniversary date of the policy. The healthcare
provider may at any subsequent election reduce the dollar amount of
the coverage for the next and subsequent fiscal years, but may not
increase the same, unless specifically authorized by the board of
governors. Any election of fund coverage limits, whenever made, shall
be with respect to judgments or settlements relating to injury or death
arising out of the rendering of or failure to render professional services
on or after the effective date of such election of fund coverage limits.
Such election shall be made for persons engaged in residency training
and persons engaged in other postgraduate training programs approved
by the state board of healing arts at medical care facilities or mental
health centers in this state by the agency or institution paying the
surcharge levied under K.S.A. 40-3404, and amendments thereto, for
HOUSE BILL No. 2509—page 13
such persons. The election of fund coverage limits for a nonprofit
corporation organized to administer the graduate medical education
programs of community hospitals or medical care facilities affiliated
with the university of Kansas school of medicine shall be deemed to be
effective at the highest option. Such options shall be as follows:
(A) (i) OPTION 1. The fund shall not be liable to pay in excess of
$100,000 pursuant to any one judgment or settlement for any party
against such healthcare provider, subject to an aggregate limitation for
all judgments or settlements arising from all claims made in the fiscal
year in an amount of $300,000 for such provider.
(ii) OPTION 2 . The fund shall not be liable to pay in excess of
$300,000 pursuant to any one judgment or settlement for any party
against such healthcare provider, subject to an aggregate limitation for
all judgments or settlements arising from all claims made in the fiscal
year in an amount of $900,000 for such provider.
(iii) OPTION 3. The fund shall not be liable to pay in excess of
$800,000 pursuant to any one judgment or settlement for any party
against such healthcare provider, subject to an aggregate limitation for
all judgments or settlements arising from all claims made in the fiscal
year in an amount of $2,400,000 for such healthcare provider.
(B) (i) OPTION 1. The fund shall not be liable to pay in excess of
$500,000 pursuant to any one judgment or settlement for any party
against such healthcare provider, subject to an aggregate limitation for
all judgments or settlements arising from all claims made in the fiscal
year in an amount of $1,500,000 for such healthcare provider.
(ii) OPTION 2. The fund shall not be liable to pay in excess of
$1,500,000 pursuant to any one judgment or settlement for any party
against such healthcare provider, subject to an aggregate limitation for
all judgments or settlements arising from all claims made in the fiscal
year in an amount of $4,500,000 for such healthcare provider.
(2) The board of governors shall have the authority to adjust the
amounts provided in subparagraph (B) as the board deems necessary to
effectuate the provisions of the healthcare provider insurance
availability act, except that the minimum coverage for a healthcare
provider shall not be less than $1,000,000 per claim and $3,000,000 in
the aggregate.
(m) In the event of a claim against a healthcare provider for
personal injury or death arising out of the rendering of or the failure to
render professional services by such healthcare provider, the liability of
the fund shall be limited to the amount of coverage selected by the
healthcare provider at the time of the incident giving rise to the claim.
(n) Notwithstanding anything in article 34 of chapter 40 of the
Kansas Statutes Annotated, and amendments thereto, to the contrary,
the fund shall in no event be liable for any claims against any
healthcare provider based upon or relating to the healthcare provider's
sexual acts or activity, but in such cases the fund may pay reasonable
and necessary expenses for attorney fees incurred in defending the fund
against such claim. The fund may recover all or a portion of such
expenses for attorney fees if an adverse judgment is returned against
the healthcare provider for damages resulting from the healthcare
provider's sexual acts or activity.
HOUSE BILL No. 2509—page 14
Sec. 5. K.S.A. 40-3402 and 40-3403 and K.S.A. 2025 Supp. 40-
3401 are hereby repealed.
Sec. 6. This act shall take effect and be in force from and after its
publication in the statute book.
I hereby certify that the above BILL originated in the HOUSE, and was
adopted by that body
HOUSE adopted
Conference Committee Report
Speaker of the House.
Chief Clerk of the House.
Passed the SENATE
as amended
SENATE adopted
Conference Committee Report
President of the Senate.
Secretary of the Senate.
APPROVED
Governor.