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House File 2175 - IntroducedA Bill ForAn Act 1relating to open communications related to adverse
2health care incidents, including the rights of patients,
3health care providers, and health care facilities.
4BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. Section 135P.3, subsection 1, unnumbered
2paragraph 1, Code 2022, is amended to read as follows:
3If an adverse health care incident occurs in a health
4facility, the health care provider, the health facility, or
5the health care provider jointly with the health facility, may
6provide the patient with written notice of the desire of the
7health care provider, the health facility, or of the health
8care provider jointly with the health facility, to enter into
9an open discussion under this chapter. A health facility may
10designate a person or class of persons who have authority to
11provide such notice on behalf of the facility. If the health
12care provider or health facility provides such notice, such
13notice must be sent within one year after the date on which
14the health care provider knew, or through the use of diligence
15should have known, of the adverse health care incident;
16however, this one-year requirement may be waived by the patient
17if done so in writing by the patient or the patient’s legal
18representative. The notice must include all of the following:
19 Sec. 2. NEW SECTION. 135P.5 Demand for policy limits —
20prima facie evidence of bad faith.
211. If a health care provider or health facility makes an
22offer of compensation under section 135P.3, subsection 3,
23paragraph “d”, subparagraph (2), the health care provider
24or health care facility shall provide the patient with the
25contents of any insurance agreement under which any person
26carrying on an insurance business may be liable to satisfy part
27or all of a judgment which may be entered in any civil action
28or to indemnify or reimburse for payments made to satisfy any
29judgment entered in any civil action filed by the patient
30against the health care provider or health facility, including
31a copy of any insurance declaration page showing the limits of
32insurance that may be available to the patient to satisfy any
33settlement or judgment relating to the patient’s injuries and
34damages. The health care provider or health facility shall
35also include a copy of any declarations page providing primary
-1-1professional liability coverage as well as any applicable
2umbrella coverages.
32. If, at the end of the compensation discussion, the
4patient has made a demand for an amount that is less than or
5equal to the applicable policy limits, and the health care
6provider or health care facility consents in writing to the
7payment by the insurance carrier of the demand, then the
8insurance carrier identified in any insurance agreement or
9declarations page produced under subsection 1 shall respond in
10writing to the patient’s demand within thirty days of receipt.
11If the insurance carrier refuses to pay the demand and the
12patient subsequently receives a verdict or judgment against
13the health care provider or health care facility in an amount
14exceeding the applicable policy limits, then notwithstanding
15section 135P.2, the patient’s demand for an amount that was
16less than or equal to the applicable policy limits, the health
17care provider or health care facility’s consent, and the
18insurance company’s refusal to pay shall be discoverable and
19admissible in any subsequent action against the insurance
20company for bad faith.
213. If the requirements of subsections 1 and 2 have been
22met and if a bad-faith action is filed against an insurer
23for failure to pay a demand under subsection 2, then there
24shall be an irrebuttable presumption of bad faith against the
25insurer and in favor of the health care provider or health care
26facility. Any subsequent verdict amount entered against an
27insurance carrier for bad faith under this subsection shall not
28be used by the insurance carrier to increase premiums charged
29to the insured health care provider, the insured health care
30facility, or the health care industry as a whole.
31 Sec. 3. NEW SECTION. 135P.6 Inquiry for open discussions.
321. This chapter shall not prohibit a patient or a patient’s
33representative from requesting that a health care provider
34consider the initiation of open discussions under section
35135P.3. If such an inquiry is received by a health care
-2-1provider and the health care provider has insurance coverage
2identifiable under section 135P.5, subsection 1, the health
3care provider may notify the insurance company of the inquiry.
42. Upon receipt of the notification of the inquiry, the
5insurance carrier shall appoint independent legal counsel to
6advise the health care provider or health facility regarding
7the health care provider’s rights under this chapter. Legal
8counsel appointed under this subsection shall continue
9to represent the health care provider throughout any open
10discussions that may subsequently take place under this
11chapter.
123. Legal counsel appointed to represent the health care
13provider under this section shall not represent the health care
14provider in any subsequent litigation related to the patient
15who inquired about the potential for open discussions or any
16patient with whom open discussions were initiated under section
17135P.3.
184. A failure of an insurance company to comply with
19subsection 2 shall be an irrebuttable presumption of bad faith
20in any subsequent litigation between the health care provider
21and the insurance company.
22EXPLANATION
23The inclusion of this explanation does not constitute agreement with
24the explanation’s substance by the members of the general assembly.
25This bill relates to open communications related to adverse
26health care incidents, including the rights of patients, health
27care providers, and health care facilities.
28Under Code chapter 135P, a health care provider, or a health
29care provider jointly with a health facility, may engage in
30an open, confidential discussion with a patient related to an
31adverse health care incident. Under current law, a health care
32provider or health care facility desiring to do so must provide
33notice within one year of the date of the adverse health care
34incident. The bill provides that the one-year limitation may
35be waived by the patient or patient’s legal representative by
-3-1written consent.
2The bill provides that if a health care provider or health
3facility makes an offer of compensation, the health care
4provider or health care facility shall provide the patient with
5the contents of any insurance agreement under which any person
6carrying on an insurance business may be liable to satisfy a
7judgment. If at the end of the discussion, the patient and
8health care provider or health care facility has reached an
9agreement for an amount equal to or less than that of the
10insurance policy, then the insurance carrier has 30 days to
11respond in writing to the agreed-upon demand. If the insurance
12carrier refuses to pay and the patient receives a subsequent
13verdict or judgment against the health care provider or health
14care facility that exceeds the policy limits than the health
15care provider or health care facility’s consent and insurance
16carrier’s refusal is discoverable and admissible in any
17subsequent action against the insurance company for bad faith.
18The bill provides that if the discussion contents become
19discoverable, there shall be an irrebuttable presumption of
20bad faith against the insurer and in favor of the health care
21provider or health care facility. Any subsequent verdict
22amount against the insurer for bad faith cannot be used to
23increase the premium charged to the health care provider,
24health care facility, or health care industry as a whole.
25The bill does not prohibit a patient or a patient’s
26representative from requesting that a health care provider
27consider the initiation of open discussions. Upon such an
28inquiry, the health care provider may notify the insurance
29company of the inquiry. Upon receipt of the notification of
30the inquiry, the insurance carrier shall appoint independent
31legal counsel to advise the health care provider regarding
32the health care provider’s rights under Code chapter 135P.
33 A failure to appoint legal counsel shall be an irrebuttable
34presumption of bad faith in any subsequent litigation between
35the health care provider and the insurance company.
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2health care incidents, including the rights of patients,
3health care providers, and health care facilities.
4BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. Section 135P.3, subsection 1, unnumbered
2paragraph 1, Code 2022, is amended to read as follows:
3If an adverse health care incident occurs in a health
4facility, the health care provider, the health facility, or
5the health care provider jointly with the health facility, may
6provide the patient with written notice of the desire of the
7health care provider, the health facility, or of the health
8care provider jointly with the health facility, to enter into
9an open discussion under this chapter. A health facility may
10designate a person or class of persons who have authority to
11provide such notice on behalf of the facility. If the health
12care provider or health facility provides such notice, such
13notice must be sent within one year after the date on which
14the health care provider knew, or through the use of diligence
15should have known, of the adverse health care incident;
16however, this one-year requirement may be waived by the patient
17if done so in writing by the patient or the patient’s legal
18representative. The notice must include all of the following:
19 Sec. 2. NEW SECTION. 135P.5 Demand for policy limits —
20prima facie evidence of bad faith.
211. If a health care provider or health facility makes an
22offer of compensation under section 135P.3, subsection 3,
23paragraph “d”, subparagraph (2), the health care provider
24or health care facility shall provide the patient with the
25contents of any insurance agreement under which any person
26carrying on an insurance business may be liable to satisfy part
27or all of a judgment which may be entered in any civil action
28or to indemnify or reimburse for payments made to satisfy any
29judgment entered in any civil action filed by the patient
30against the health care provider or health facility, including
31a copy of any insurance declaration page showing the limits of
32insurance that may be available to the patient to satisfy any
33settlement or judgment relating to the patient’s injuries and
34damages. The health care provider or health facility shall
35also include a copy of any declarations page providing primary
-1-1professional liability coverage as well as any applicable
2umbrella coverages.
32. If, at the end of the compensation discussion, the
4patient has made a demand for an amount that is less than or
5equal to the applicable policy limits, and the health care
6provider or health care facility consents in writing to the
7payment by the insurance carrier of the demand, then the
8insurance carrier identified in any insurance agreement or
9declarations page produced under subsection 1 shall respond in
10writing to the patient’s demand within thirty days of receipt.
11If the insurance carrier refuses to pay the demand and the
12patient subsequently receives a verdict or judgment against
13the health care provider or health care facility in an amount
14exceeding the applicable policy limits, then notwithstanding
15section 135P.2, the patient’s demand for an amount that was
16less than or equal to the applicable policy limits, the health
17care provider or health care facility’s consent, and the
18insurance company’s refusal to pay shall be discoverable and
19admissible in any subsequent action against the insurance
20company for bad faith.
213. If the requirements of subsections 1 and 2 have been
22met and if a bad-faith action is filed against an insurer
23for failure to pay a demand under subsection 2, then there
24shall be an irrebuttable presumption of bad faith against the
25insurer and in favor of the health care provider or health care
26facility. Any subsequent verdict amount entered against an
27insurance carrier for bad faith under this subsection shall not
28be used by the insurance carrier to increase premiums charged
29to the insured health care provider, the insured health care
30facility, or the health care industry as a whole.
31 Sec. 3. NEW SECTION. 135P.6 Inquiry for open discussions.
321. This chapter shall not prohibit a patient or a patient’s
33representative from requesting that a health care provider
34consider the initiation of open discussions under section
35135P.3. If such an inquiry is received by a health care
-2-1provider and the health care provider has insurance coverage
2identifiable under section 135P.5, subsection 1, the health
3care provider may notify the insurance company of the inquiry.
42. Upon receipt of the notification of the inquiry, the
5insurance carrier shall appoint independent legal counsel to
6advise the health care provider or health facility regarding
7the health care provider’s rights under this chapter. Legal
8counsel appointed under this subsection shall continue
9to represent the health care provider throughout any open
10discussions that may subsequently take place under this
11chapter.
123. Legal counsel appointed to represent the health care
13provider under this section shall not represent the health care
14provider in any subsequent litigation related to the patient
15who inquired about the potential for open discussions or any
16patient with whom open discussions were initiated under section
17135P.3.
184. A failure of an insurance company to comply with
19subsection 2 shall be an irrebuttable presumption of bad faith
20in any subsequent litigation between the health care provider
21and the insurance company.
22EXPLANATION
23The inclusion of this explanation does not constitute agreement with
24the explanation’s substance by the members of the general assembly.
25This bill relates to open communications related to adverse
26health care incidents, including the rights of patients, health
27care providers, and health care facilities.
28Under Code chapter 135P, a health care provider, or a health
29care provider jointly with a health facility, may engage in
30an open, confidential discussion with a patient related to an
31adverse health care incident. Under current law, a health care
32provider or health care facility desiring to do so must provide
33notice within one year of the date of the adverse health care
34incident. The bill provides that the one-year limitation may
35be waived by the patient or patient’s legal representative by
-3-1written consent.
2The bill provides that if a health care provider or health
3facility makes an offer of compensation, the health care
4provider or health care facility shall provide the patient with
5the contents of any insurance agreement under which any person
6carrying on an insurance business may be liable to satisfy a
7judgment. If at the end of the discussion, the patient and
8health care provider or health care facility has reached an
9agreement for an amount equal to or less than that of the
10insurance policy, then the insurance carrier has 30 days to
11respond in writing to the agreed-upon demand. If the insurance
12carrier refuses to pay and the patient receives a subsequent
13verdict or judgment against the health care provider or health
14care facility that exceeds the policy limits than the health
15care provider or health care facility’s consent and insurance
16carrier’s refusal is discoverable and admissible in any
17subsequent action against the insurance company for bad faith.
18The bill provides that if the discussion contents become
19discoverable, there shall be an irrebuttable presumption of
20bad faith against the insurer and in favor of the health care
21provider or health care facility. Any subsequent verdict
22amount against the insurer for bad faith cannot be used to
23increase the premium charged to the health care provider,
24health care facility, or health care industry as a whole.
25The bill does not prohibit a patient or a patient’s
26representative from requesting that a health care provider
27consider the initiation of open discussions. Upon such an
28inquiry, the health care provider may notify the insurance
29company of the inquiry. Upon receipt of the notification of
30the inquiry, the insurance carrier shall appoint independent
31legal counsel to advise the health care provider regarding
32the health care provider’s rights under Code chapter 135P.
33 A failure to appoint legal counsel shall be an irrebuttable
34presumption of bad faith in any subsequent litigation between
35the health care provider and the insurance company.
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