Lorraine Paternaster, Administratrix of the Estate of Damon Paternaster v. Dong P. Lee, M.D., and Commonwealth of Pennsylvania Medical Professional Liability Catastrophe Loss Fund

Summary

The Supreme Court of Pennsylvania affirmed summary judgment for the Pennsylvania Medical Professional Liability Catastrophe Loss Fund in a medical malpractice coverage dispute. The Court held that CAT Fund regulations requiring a health care provider with claims-made coverage to obtain tail or comparable coverage were valid and consistent with the Health Care Services Malpractice Act. Because the physician allowed his claims-made policy to lapse without obtaining tail coverage, the CAT Fund was not responsible for the resulting default judgment.

Holdings

1. Section 701(e)(11) of the Health Care Services Malpractice Act authorized the CAT Fund director to issue substantive regulations concerning the establishment and operation of the Fund, including regulations addressing claims for which no primary insurance remained because a provider failed to obtain tail or equivalent coverage.
2. The CAT Fund regulations requiring a provider with a claims-made policy to obtain tail, prior-acts, or substantially equivalent coverage were within the director's authority, reasonable, and consistent with the Act.
3. The CAT Fund was not responsible for covering the default judgment against Dr. Lee because Dr. Lee failed to maintain primary coverage after his claims-made policy lapsed and did not obtain tail or equivalent coverage.

Questions Presented

1. Whether the CAT Fund was required to indemnify Dr. Lee for a malpractice judgment when he had maintained the required primary insurance at the time of the alleged malpractice but later allowed a claims-made policy to lapse without obtaining tail or equivalent coverage.
2. Whether the CAT Fund director had statutory authority to promulgate regulations requiring providers with claims-made policies to obtain tail, prior-acts, or equivalent coverage to preserve CAT Fund coverage.
3. Whether those CAT Fund regulations were consistent with and reasonably implemented the Health Care Services Malpractice Act.

Disposition

affirmed