AN ACT Relating to medical malpractice; amending RCW 18.72.030, 18.72.040, 18.72.155, 48.19.030, 4.22.060, 4.24.260, and 4.16.350; adding new sections to chapter 7.70 RCW; adding new sections to chapter 18.57 RCW; adding new sections to chapter 18.71 RCW; adding new sections to chapter 18.72 RCW; adding a new section to chapter 48.42 RCW; adding new sections to chapter 70.41 RCW; creating a new section; and prescribing penalties.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. (1) The legislature finds and declares that:

(a) Medical services and treatment often are not available to low-income persons;

(b) Public funds are conserved if low-income persons receive primary and preventive medical services and treatment from qualified and competent physicians;

(c) Lack of access to proper medical care has a negative impact on the health, work performance, and family life of low-income persons;

(d) Premiums that physicians pay for professional liability insurance are a factor in the rising cost of medical services and treatment; and

(e) It is the public policy of the state to indemnify physicians for certain costs associated with malpractice against physicians who deliver medical services and treatment to low-income persons.

(2) The legislature also finds that, by establishing an indemnification program, the escalating cost of malpractice insurance will be reduced and the availability and affordability of quality health care services will continue to exist.

(3) The legislature further finds that hospitals must enhance their efforts to reduce medical malpractice through the establishment of medical malpractice prevention programs and through greater scrutiny of physicians prior to granting hospital privileges.

PART I

MEDICAL DISCIPLINARY BOARD

Sec. 2. Section 3, chapter 202, Laws of 1955 as last amended by section 1, chapter 111, Laws of 1979 ex. sess. and RCW 18.72.030 are each amended to read as follows:

The term "unprofessional conduct" as used in this chapter and chapter 18.71 RCW shall mean the following items or any one or combination thereof:

(1) The commission of any act involving moral turpitude, dishonesty, or corruption, whether the same be committed in the course of his or her relations as a physician, or otherwise, and whether the same constitutes a crime or not; and if the act constitutes a crime, conviction thereof in a criminal proceeding shall not be a condition precedent to disciplinary action. Upon such conviction, however, the judgment and sentence shall be conclusive evidence at the ensuing disciplinary hearing of the guilt of the respondent physician of the crime described in the indictment or information, and of his or her violation of the statute upon which it is based;

(2) The procuring, or aiding or abetting in procuring a criminal abortion;

(3) Misrepresentation or concealment of ((~~a material~~)) any fact or action constituting unprofessional conduct in the obtaining of a license to practice medicine or in ((~~reinstatement thereof~~)) the annual application for renewal;

(4) All advertising of medical business which is intended or has a tendency to deceive the public or impose upon credulous or ignorant persons and so be harmful or injurious to public morals or safety;

(5) The impersonation of another licensed practitioner;

(6) The possession, use, prescription for use, or distribution of controlled substances or legend drugs in any way other than for therapeutic purposes;

(7) The offering, undertaking, or agreeing to cure or treat disease by a secret method, procedure, treatment, or medicine, or the treating, operating, or prescribing for any human condition by a method, means, or procedure which the licensee refuses to divulge upon demand of the board;

(8) Unprofessional conduct as defined in chapter 19.68 RCW;

(9) Aiding or abetting an unlicensed person to practice medicine;

(10) Suspension or revocation of the physician's license to practice medicine by competent authority in any state, federal, or foreign jurisdiction;

(11) Incompetency or negligence in the practice of medicine and surgery resulting in serious harm to the patient;

(12) Violation of any board rule or regulation fixing a standard of professional conduct;

(13) Wilful violation of RCW 18.72.175 or wilful disregard of the subpoena or notice of the Washington state medical disciplinary board;

(14) Gross, wilful, or continued overcharging for professional services; ((or))

(15) Failure to abide by the terms of corrective actions directed pursuant to RCW 18.72.150(6);

(16) Conduct likely to deceive, defraud, or harm the public;

(17) False statements by a physician regarding his or her skill or the efficacy or value of a medical treatment or remedy prescribed by the physician or at his or her direction in the treatment of any disease or condition of the body or mind;

(18) A pattern of practice or behavior that demonstrates in the opinion of the board an incapacity or incompetence to practice medicine with reasonable skill and safety;

(19) Failure to report to the board any adverse judgment, settlement, or award arising from a medical negligence claim relating to acts or conduct which would constitute grounds for action under this section;

(20) Commission of any act of sexual abuse, misconduct, or exploitation directly or indirectly related to the licensee's practice of medicine;

(21) Obtaining any fee by fraud, deceit, or misrepresentation; or

(22) Except as otherwise permitted by law and as recognized by currently accepted standards of practice, prescribing, selling, administering, distributing, or giving to an habitue or addict, or to a person that the physician knew or reasonably should have known has been treated for addiction to controlled substances, any drug legally classified as a controlled substance.

Sec. 3. Section 4, chapter 202, Laws of 1955 as amended by section 1, chapter 71, Laws of 1977 and RCW 18.72.040 are each amended to read as follows:

There is hereby created the "Washington state medical disciplinary board," which shall be composed of one holder of a valid license to practice medicine and surgery from each congressional district now existing or hereafter created in the state and ((~~one~~)) three members of the public who meet((s)) the qualifications contained in RCW 70.39.020(2) shall be appointed by the governor. The public ((~~member's~~)) members' term shall be for ((~~two~~)) four years ((~~commencing on October 1st of each odd-numbered year~~)). In order to achieve staggered terms, the public member serving on the board on the effective date of this 1986 act shall continue to serve until October 1, 1987. The remaining two public members shall be appointed to initial terms of three years and four years, respectively.

The board shall be an administrative agency of the state of Washington. The attorney general shall be the advisor of the board and shall represent it in all legal proceedings. Assistant attorneys general assigned to the board are subject to the approval of the board and shall work under the direct control of the board while so assigned.

Sec. 4. Section 6, chapter 111, Laws of 1979 ex. sess. and RCW 18.72.155 are each amended to read as follows:

The director of the department of licensing shall appoint, from a list of three names supplied by the board, an executive secretary who shall act to carry out the provisions of this chapter. The director shall also employ such additional staff including administrative assistants, investigators, and clerical staff as are required to enable the board to accomplish its duties and responsibilities. Investigators employed under this section shall be assigned solely to the board and are subject to the approval of the board. The executive secretary shall be exempt from the provisions of the civil service law, chapter 41.06 RCW, as now or hereafter amended.

PART II

MEDICAL MALPRACTICE PREVENTION PROGRAM

NEW SECTION. Sec. 5. A new section is added to chapter 70.41 RCW to read as follows:

(1) Every hospital shall maintain a coordinated program for the identification and prevention of medical malpractice. The program shall include at least the following:

(a) The establishment of a quality assurance committee with the responsibility to review the services rendered in the hospital in order to improve the quality of medical care of patients and to prevent medical malpractice. The committee shall oversee and coordinate the medical malpractice prevention program and shall insure that information gathered pursuant to the program is used to review and to revise hospital policies and procedures. At least one member of the committee shall be a member of the governing board of the hospital who is not otherwise affiliated with the hospital in an employment or contractual capacity;

(b) A medical staff privileges sanction procedure through which credentials, physical and mental capacity, and competence in delivering health care services are periodically reviewed as part of an evaluation of staff privileges;

(c) The periodic review of the credentials, physical and mental capacity, and competence in delivering health care services of all persons who are employed or associated with the hospital;

(d) A procedure for the prompt resolution of grievances by patients or their representatives related to accidents, injuries, treatment, and other events that may result in claims of medical malpractice;

(e) The maintenance and continuous collection of information concerning the hospital's experience with negative health care outcomes and incidents injurious to patients, patient grievances, professional liability premiums, settlements, awards, costs incurred by the hospital for patient injury prevention, and safety improvement activities;

(f) The maintenance of relevant and appropriate information gathered pursuant to (a) through (e) of this subsection concerning individual physicians within the physician's personnel or credential file maintained by the hospital;

(g) Education programs dealing with patient safety, injury prevention, staff responsibility to report professional misconduct, the legal aspects of patient care, improved communication with patients, and causes of malpractice claims for staff personnel engaged in patient care activities;

(h) Continuing education programs for medical staff in their areas of specialty; and

(i) Policies to ensure compliance with the reporting requirements of this section.

(2) Any person who, in good faith and without malice, provides information to further the purposes of the medical malpractice prevention program or who, in good faith and without malice, participates on the quality assurance committee shall not be subject to an action for civil damages of other relief as a result of such activity.

(3) Information and documents, including complaints and incident reports, collected and maintained pursuant to this section about an individual physician arising out of the matters that are subject to evaluation by a medical review committee conducting peer reviews are not subject to discovery or introduction into evidence in any civil action for or against a physician or health care provider, and no person who was in attendance at a meeting of such committee shall be permitted or required to testify in any such civil action as to the content of such proceedings. This subsection does not preclude (a) in any civil action, the use of any writing which was recorded independently of such proceedings; (b) in any civil action, the testimony of any person concerning the facts which formed the basis for the institution of such proceedings of which the person had personal knowledge acquired independently of such proceedings; (c) in any physician or health care provider proceedings concerning the termination or restriction of staff privileges, other than peer review, the use of data discussed or developed during peer review proceedings; or (d) in any civil action, disclosure of the fact that staff privileges were terminated or restricted, including the specific restrictions imposed, if any.

(4) The department of social and health services shall adopt such rules as are deemed appropriate to effectuate the purposes of this section.

(5) The medical disciplinary board or the board of osteopathic medicine and surgery, as appropriate, may audit the records and files of the quality assurance committees and peer review committees in cases in which the board has reason to believe that a staff physician may be incapable of practicing with reasonable skill and safety. Each hospital shall produce and make accessible to the board its complete records and files relating to that physician's ability to practice with reasonable skill and safety and otherwise facilitate the audit. Information so gained shall not be subject to the discovery process and confidentiality shall be respected as required by law. Failure of a hospital to comply with this subsection is punishable by a civil penalty of two hundred fifty dollars.

NEW SECTION. Sec. 6. A new section is added to chapter 18.72 RCW to read as follows:

A licensed health care professional shall report to the medical disciplinary board when he or she has personal knowledge that a practicing physician has either committed an act or acts which may constitute statutorily defined unprofessional conduct or that a practicing physician may be unable to practice medicine with reasonable skill and safety to patients by reason of illness, drunkenness, excessive use of drugs, narcotics, chemicals, or any other type of material, or as a result of any mental or physical conditions.

(2) Reporting under this section is not required by:

(a) An appropriately appointed peer review committee member of a licensed hospital or by an appropriately designated professional review committee member of a county or state medical society during the investigative phase of their respective operations if these investigations are completed in a timely manner; or

(b) A treating licensed health care professional of a physician currently involved in a treatment program as long as the physician patient actively participates in the treatment program and the physician patient's impairment does not constitute a clear and present danger to the public health, safety, or welfare.

(3) The medical disciplinary board may impose disciplinary sanctions, including license suspension or revocation, on any health care professional subject to the jurisdiction of the board who has failed to comply with this section. The board may recommend disciplinary sanctions to any disciplinary authority, and the disciplinary authority may take disciplinary action, including license suspension or revocation, against a health care professional not subject to the jurisdiction of the board who has failed to comply with this section.

(4) As used in this section, "health care professional" means a person licensed by this state to provide health care or related services, including, but not limited to, a certified acupuncturist, a physician, osteopathic physician, dentist, nurse, optometrist, podiatrist, chiropractor, physical therapist, psychologist, pharmacist, optician, physician's assistant, midwife, osteopathic physician's assistant, nurse practitioner, or physician's trained mobile intensive care paramedic.

NEW SECTION. Sec. 7. A new section is added to chapter 18.72 RCW to read as follows:

(1) Every institution or organization providing professional liability insurance directly or indirectly to physicians shall send a complete report to the medical disciplinary board of all malpractice settlements, awards, or payments in excess of two thousand five hundred dollars as a result of a claim or action for damages alleged to have been caused by an insured physician's incompetency or negligence in the practice of medicine.

(2) Reports required by this section shall be made within sixty days of the date of the settlement or verdict or the date the allegation is made. Failure to comply with this section is punishable by a civil penalty of two hundred fifty dollars.

NEW SECTION. Sec. 8. A new section is added to chapter 18.72 RCW to read as follows:

The chief administrator or executive officer of a hospital shall report to the board when a physician's clinical privileges are terminated or are restricted based on a determination, in accordance with an institution's bylaws, that a physician has either committed an act or acts which may constitute unprofessional conduct. The officer shall also report if a physician accepts voluntary termination or restriction of clinical privileges in lieu of formal action based on unprofessional conduct. Such a report shall be made within sixty days of the date action was taken by the hospital's peer review committee or the physician's acceptance of voluntary termination or restriction of privileges. Failure of a hospital to comply with this section is punishable by a civil penalty of two hundred fifty dollars.

NEW SECTION. Sec. 9. A new section is added to chapter 18.72 RCW to read as follows:

Each hospital shall keep written minutes of every committee meeting or hearing in which the privileges of practicing physicians or their competency and qualifications are evaluated and every committee or board whose responsibility it is to evaluate the quality of patient care. Copies of such minutes shall be made available to the board within thirty days of a request and all information so gained shall remain confidential in accordance with law and shall be protected from the discovery process. Failure of a hospital to comply with this section is punishable by a civil penalty of two hundred fifty dollars.

NEW SECTION. Sec. 10. A new section is added to chapter 18.57 RCW to read as follows:

A licensed health care professional shall report to the board when he or she has personal knowledge that a practicing osteopathic physician has either committed an act or acts which may constitute statutorily defined unprofessional conduct or that a practicing osteopathic physician may be unable to practice osteopathic medicine with reasonable skill and safety to patients by reason of illness, drunkenness, excessive use of drugs, narcotics, chemicals, or any other type of material, or as a result of any impairing mental or physical conditions.

(2) Reporting under this section is not required by:

(a) An appropriately appointed peer review committee member of a licensed hospital or by an appropriately designated professional review committee member of an osteopathic medical society during the investigative phase of their respective operations if these investigations are completed in a timely manner; or

(b) A treating licensed health care professional of an osteopathic physician currently involved in a treatment program as long as the physician patient actively participates in the treatment program and the physician patient's impairment does not constitute a clear and present danger to the public health, safety, or welfare.

(3) The board may impose disciplinary sanctions, including license suspension or revocation, on any health care professional subject to the jurisdiction of the board who has failed to comply with this section. The board may recommend disciplinary sanctions to any disciplinary authority, and the disciplinary authority may take disciplinary action, including license suspension or revocation, against a health care professional not subject to the jurisdiction of the board who has failed to comply with this section.

NEW SECTION. Sec. 11. A new section is added to chapter 18.57 RCW to read as follows:

Every institution or organization providing professional liability insurance directly or indirectly to osteopathic physicians shall send a complete report to the board of all malpractice settlements, awards, or payments in excess of two thousand five hundred dollars as a result of a claim or action for damages alleged to have been caused by an insured physician's incompetency or negligence in the practice of osteopathic medicine. Such institution or organization shall also report instances in which there is an allegation that the physician may be unable to practice with reasonable skill and safety to patients as the result of any mental or physical condition that may constitute an apparent risk to the public health, safety, or welfare.

PART III

GRANT OR RENEWAL OF HOSPITAL PRIVILEGES

NEW SECTION. Sec. 12. A new section is added to chapter 70.41 RCW to read as follows:

(1) Prior to granting or renewing professional privileges or association of any physician or hiring a physician, a hospital or facility approved pursuant to this chapter shall request from the physician and the physician shall provide the following information:

(a) The name of any hospital or facility with or at which the physician had or has any association, employment, privileges, or practice;

(b) If such association, employment, privilege, or practice was discontinued, the reasons for its discontinuation;

(c) Any pending professional medical misconduct proceedings or any pending medical malpractice actions in this state or another state, the substance of the allegations in the proceedings or actions, and any additional information concerning the proceedings or actions as the physician deems appropriate;

(d) The substance of the findings in the actions or proceedings and any additional information concerning the actions or proceedings as the physician deems appropriate;

(e) A waiver by the physician of any confidentiality provisions concerning the information required to be provided to hospitals pursuant to this subsection; and

(f) A verification by the physician that the information provided by the physician is accurate and complete.

(2) Prior to granting privileges or association to any physician or hiring a physician, hospital or facility approved pursuant to this chapter shall request from any hospital with or at which the physician had or has privileges, was associated, or was employed, the following information concerning the physician:

(a) Any pending professional medical conduct proceedings or any pending medical malpractice actions, in this state or another state;

(b) Any judgment or settlement of a medical malpractice action and any finding of professional misconduct in this state or another; and

(3) The medical disciplinary board shall be advised within thirty days of the name of any physician denied staff privileges, association, or employment on the basis of adverse findings under subsection (1) of this section.

(4) A hospital or facility that receives a request for information from another hospital or facility pursuant to subsections (1) and (2) of this section shall provide such information concerning the physician in question to the extent such information is known to the hospital or facility receiving such a request, including the reasons for suspension, termination, or curtailment of employment or privileges at the hospital or facility. A hospital, facility, or other person providing such information in good faith is not liable in any civil action for the release of such information.

(5) Information and documents collected and maintained pursuant to this section are not subject to discovery or introduction into evidence in any civil action for or against a physician, health care provider, hospital, or facility arising out of the matters that are subject to evaluation by a medical review committee conducting peer review, and no person who was in attendance at a meeting of such committee shall be permitted or required to testify in any such civil action as to the content of such proceedings. This subsection does not preclude (a) in any civil action, the use of any writing which was recorded independently of such proceedings; (b) in any civil action, the testimony of any person concerning the facts which formed the basis for the institution of such proceedings of which the person had personal knowledge acquired independently of such proceedings; (c) in any physician or health care provider proceedings concerning the termination or restriction of staff privileges, other than peer review, the use of data discussed or developed during peer review proceedings; or (d) in any civil action, disclosure of the fact that staff privileges were terminated or restricted, including the specific restrictions imposed and the reasons therefor.

PART IV

PHYSICIANS' PROFESSIONAL LIABILITY INSURANCE MERIT RATING PLAN

NEW SECTION. Sec. 13. A new section is added to chapter 48.42 RCW to read as follows:

The insurance commissioner may, if actuarially appropriate, promulgate a regulation, which may be amended as necessary to reflect changing circumstances, establishing a physicians professional liability insurance merit rating plan which reflects an individual physician's or surgeon's experience with respect to incidents or occurrences of alleged medical malpractice. The regulation shall establish standards and limitations intended to insure that merit rating plans are reasonable and are not unfairly discriminatory, inequitable, violative of public policy, or otherwise contrary to the best interests of the people of this state. The regulation shall include:

(1) Reasonable standards to be applied in arriving at premium rates, surcharges, and discounts based on an evaluation of the hazards of the insured, geographical area, specialties of practice, past and prospective loss and expense experience for medical malpractice insurance written and to be written in this state, trends in the frequency and severity of losses, and the limited nature, if any, of the practice of the insured;

(2) Rules for recognizing experience of individual risks; and

(3) Any other factors deemed relevant in a system of merit rating for the purpose of establishing equitable merit rates.

The insurance commissioner shall also consider, in establishing the regulation, whether premium rates unfairly burden physicians who are initiating their practice, those who are transitioning to retirement or those who practice part time or hold academic positions.

Insurers shall review merit rating plans that were approved by the insurance commissioner prior to the promulgation of the regulation required by this section and shall file with the insurance commissioner statements that their merit rating plans conform with the regulation, or file an appropriate plan or amendments to their existing plans that will bring them into compliance with the standards of the regulation. Any such amendments shall become effective upon approval by the insurance commissioner.

PART V

INDEMNIFICATION

NEW SECTION. Sec. 14. A new section is added to chapter 18.71 RCW to read as follows:

The definitions in this section apply to this section and sections 15 and 16 of this act.

(1) "Qualified physician" means a physician licensed under chapter 18.57 RCW or this chapter, (a) at least two percent of whose patients treated in the eighteen months preceding a claim, or the physician's period of practice in this state if shorter, were receiving assistance under chapter 74.09 RCW, and (b) who for the thirty months preceding the claim, or the physician's period of practice in this state if shorter, carried professional liability insurance in at least the amount of one million dollars per occurrence and three million dollars annual aggregate.

(2) "Claim" means an action filed against a qualified physician in any court having jurisdiction in the state seeking money damages under chapter 7.70 RCW on account of alleged negligence in care committed in this state after July 1, 1986. However, not more than one claim arising from a single course of treatment of an individual patient shall be indemnified under section 15 of this act.

(3) "Application" means a request by a qualified physician for indemnification for the amount of a settlement or judgment associated with a claim, subject to the provisions and limitations of section 15 of this act.

NEW SECTION. Sec. 15. A new section is added to chapter 18.71 RCW to read as follows:

(1) The state shall indemnify qualified physicians who submit an application under this section for that portion of any claim in excess of one million dollars and less than five million dollars.

(2) All applications shall be submitted to the office of financial management for verification and approval. The office of financial management may inspect the medical and financial records of qualified physicians as necessary to verify qualified physician status and facts relevant to the claim. The office of financial management shall not disclose information related to the financial status of any patient except as necessary under this section.

(3) Nothing in this section may be construed as creating an obligation on the part of the state to defend any claim against a qualified physician. (4) Pursuant to chapter 34.04 RCW, the office of financial management shall adopt rules consistent with this section to carry out its purpose.

(5) The office of financial management, in consultation with the risk manager, may recommend to the governor and the legislature modifications in the claim limitations established by subsection (1) of this section.

NEW SECTION. Sec. 16. A new section is added to chapter 18.71 RCW to read as follows:

(1) The risk manager under RCW 43.19.19362 shall self-insure or purchase insurance coverage for the state in an amount sufficient to indemnify physicians for claims under section 15 of this act.

(2) The director of licensing shall collect a fee of one hundred dollars, which shall be in addition to any fees established pursuant to RCW 43.24.086, to license and regulate physicians licensed under chapter 18.57 RCW or this chapter. The fees collected under this subsection shall be deposited in the medical indemnification account hereby created in the state treasury. Moneys in the account shall be appropriated exclusively for the purposes of subsection (1) of this section.

Sec. 17. Section .19.03, chapter 79, Laws of 1947 and RCW 48.19.030 are each amended to read as follows:

Rates shall be used, subject to the other provisions of this chapter, only if made in accordance with the following provisions:

(1) In the case of insurances under standard fire policies and that part of marine and transportation insurances not exempted under RCW 48.19.010, manual, minimum, class or classification rates, rating schedules or rating plans, shall be made and adopted; except as to specific rates on inland marine risks individually rated, which risks are not reasonably susceptible to manual or schedule rating, and which risks by general custom of the business are not written according to manual rates or rating plans.

(2) In the case of casualty and surety insurances:

(a) The systems of expense provisions included in the rates for use by any insurer or group of insurers may differ from those of other insurers or groups of insurers to reflect the requirements of the operating methods of any such insurer or group with respect to any kind of insurance, or with respect to any subdivision or combination thereof for which subdivision or combination separate expense provisions are applicable.

(b) Risks may be grouped by classifications for the establishment of rates and minimum premiums. Classification rates may be modified to produce rates for individual risks in accordance with rating plans which establish standards for measuring variations in hazards or expense provisions, or both. Such standards may measure any differences among risks that can be demonstrated to have a probable effect upon losses or expenses.

(3) In the case of insurance policies providing coverage for liability imposed by law for damages caused by or arising out of professional services rendered by a qualified physician, as defined in section 14 of this 1986 act, insurers shall return as dividends, savings, or unabsorbed premium deposits to such qualified physicians that amount of premium attributable to risks associated with claims for which the state of Washington has assumed financial responsibility pursuant to section 15 of this 1986 act, as established by past and prospective loss experience within the state of Washington.

(4) Due consideration in making rates for all insurances shall be given to:

(a) Past and prospective loss experience within and outside this state; and in the case of rates for fire insurance, to the loss experience of insurers as to insurance against fire during a period of not less than the most recent five-year period for which such experience is available.

(b) Conflagration and catastrophe hazards, where present.

(d) Dividends, savings and unabsorbed premium deposits allowed or returned by insurers to their policyholders, members, or subscribers.

(e) All other relevant factors within and outside this state.

((~~(4)~~)) (5) In addition to other factors required by this section, rates filed by an insurer on its own behalf may also be related to the insurer's plan of operation and plan of risk classification.

((~~(5)~~)) (6) Except to the extent necessary to comply with RCW 48.19.020 uniformity among insurers in any matter within the scope of this section is neither required nor prohibited.

Sec. 18. Section 14, chapter 27, Laws of 1981 and RCW 4.22.060 are each amended to read as follows:

(1) A party prior to entering into a release, covenant not to sue, covenant not to enforce judgment, or similar agreement with a claimant shall give five days' written notice of such intent to all other parties and the court. The court may for good cause authorize a shorter notice period. The notice shall contain a copy of the proposed agreement. A hearing shall be held on the issue of the reasonableness of the amount to be paid with all parties afforded an opportunity to present evidence. A determination by the court that the amount to be paid is reasonable must be secured. If an agreement was entered into prior to the filing of the action, a hearing on the issue of the reasonableness of the amount paid at the time it was entered into may be held at any time prior to final judgment upon motion of a party. The state, through the attorney general, shall be notified and afforded an opportunity to present evidence if the agreement relates to an action under chapter 7.70 RCW and the settlement amount equals or exceeds one million dollars.

(2) A release, covenant not to sue, covenant not to enforce judgment, or similar agreement entered into by a claimant and a person liable discharges that person from all liability for contribution, but it does not discharge any other persons liable upon the same claim unless it so provides. However, the claim of the releasing person against other persons is reduced by the amount paid pursuant to the agreement unless the amount paid was unreasonable at the time of the agreement in which case the claim shall be reduced by an amount determined by the court to be reasonable.

(3) A determination that the amount paid for a release, covenant not to sue, covenant not to enforce judgment, or similar agreement was unreasonable shall not affect the validity of the agreement between the released and releasing persons nor shall any of the agreement between the released and releasing persons nor shall any adjustment be made in the amount paid between the parties to the agreement.

PART VI

IMMUNITY FROM LIABILITY

NEW SECTION. Sec. 19. A new section is added to chapter 7.70 RCW to read as follows:

In the absence of wilful or wanton conduct, members of the board of directors or other governing body of a public or private hospital are not individually liable for injuries resulting from health care administered by a health care provider under the supervision or employment of the hospital.

Sec. 20. Section 2, chapter 144, Laws of 1971 ex. sess. as amended by section 3, chapter 114, Laws of 1975 1st ex. sess. and RCW 4.24.260 are each amended to read as follows:

Physicians licensed under chapter 18.71 RCW((~~[,]~~)), dentists licensed under chapter 18.32 RCW and pharmacists licensed under chapter 18.64 RCW who, in good faith, file charges or present evidence against another member of their profession based on ((~~the~~)) claimed ((~~incompetency or gross misconduct~~)) unprofessional conduct as defined in RCW 18.72.030 of such person before the medical disciplinary board established under 18.72 RCW, in a proceeding under chapter 18.32 RCW or to the board of pharmacy under RCW 18.64.160 shall be immune from civil action for damages arising out of such activities.

PART VII

TIME LIMITATIONS ON ACTIONS

Sec. 21. Section 1, chapter 80, Laws of 1971 as amended by section 1, chapter 56, Laws of 1975-'76 2nd ex. sess. and RCW 4.16.350 are each amended to read as follows:

Any civil action for damages for injury occurring as a result of health care which is provided after June 25, 1976 against:

(1) A person licensed by this state to provide health care or related services, including, but not limited to, a physician, osteopathic physician, dentist, nurse, optometrist, podiatrist, chiropractor, physical therapist, psychologist, pharmacist, optician, physician's assistant, osteopathic physician's assistant, nurse practitioner, or physician's trained mobile intensive care paramedic, including, in the event such person is deceased, his estate or personal representative;

(2) An employee or agent of a person described in subsection (1) of this section, acting in the course and scope of his employment, including, in the event such employee or agent is deceased, his estate or personal representative; or

(3) An entity, whether or not incorporated, facility, or institution employing one or more persons described in subsection (1) of this section, including, but not limited to, a hospital, clinic, health maintenance organization, or nursing home; or an officer, director, employee, or agent thereof acting in the course and scope of his employment, including, in the event such officer, director, employee, or agent is deceased, his estate or personal representative;

based upon alleged professional negligence shall be commenced within three years of the ((~~act or omission alleged to have caused the injury or condition, or one year of the~~)) time the patient or his representative discovered or reasonably should have discovered ((~~that~~)) the injury or condition ((~~was caused by said act or omission, whichever period expires later, except that in no event shall an action be commenced more than eight years after said act or omission~~)) and its cause.

For purposes of this section, notwithstanding RCW 4.16.190, the knowledge of a custodial parent or guardian shall be imputed to a person under the age of eighteen years.

Any action not commenced in accordance with this section shall be barred((~~: PROVIDED, That the limitations in this section shall not apply to persons under a legal disability as defined in RCW 4.16.190~~)).

PART VIII

MEDICAL MALPRACTICE SCREENING PANELS

NEW SECTION. Sec. 22. If the parties to a claim for damages for personal injury or death on account of alleged professional negligence of a health care provider agree, they may select a medical malpractice screening panel.

The membership of the screening panel shall be selected as follows: (1) A health care provider designated by the person against whom the claim has been made; (2) a health care provider designated by the person injured by the alleged medical malpractice; (3) a health care provider selected jointly by the claimant and the person against whom the claim is made; and (4) an attorney selected by the presiding judge of the superior court of the county in which the alleged medical malpractice occurred. Such attorney shall be a nonvoting member of the screening panel but shall act as chairperson of the panel. The persons selected shall constitute the screening panel for the particular medical malpractice claim to be heard.

The state agency that licenses, registers, certifies, or otherwise is responsible for the practice of any group of health care providers shall maintain and make available to the parties to the proceeding a current list of health care providers who are willing and available to serve on screening panels.

NEW SECTION. Sec. 23. The medical malpractice screening panel shall convene with written notice to all parties and their counsel and shall decide, after consideration of all medical records, contentions of the parties, testimony of experts, examination of x-rays, test results, and treatises, whether there was a departure from the appropriate standard of care of the specialty involved and whether a causal relationship existed between the damages suffered by the claimant and any such departure.

At the hearing, the parties are entitled to be heard, to present relevant evidence, and to cross-examine witnesses to the extent necessary to enable the panel to render an opinion. The rules of evidence need not be observed. The screening panel may proceed with the hearing and render an opinion on the evidence produced, notwithstanding the failure of a party notified to appear.

The screening panel may issue or cause to be issued, on its own motion or on application of any party, subpoenas for the attendance of witnesses and for the production of books, records, documents, and other evidence not otherwise protected by law from discovery and admissibility in a court of law. Subpoenas shall be served and enforced in the manner provided for the service and enforcement of subpoenas in a civil action.

The hearing shall be conducted by all members of the panel unless the parties otherwise agree. A majority of the members of the panel may determine any question and may render an opinion.

NEW SECTION. Sec. 24. (1) Within thirty days, after receiving all the evidence, the panel shall, after joint deliberation, render one or more of the following opinions:

(a) The evidence does not support a conclusion that the health care provider failed to comply with the appropriate standard of care;

(b) The evidence supports a conclusion that the health care provider failed to comply with the appropriate standard of care and that such failure is a proximate cause in the alleged damages;

(c) The evidence supports a conclusion that the health care provider failed to comply with the appropriate standard of care and that such failure is not a proximate cause in the alleged damages; or

(d) The evidence indicates that there is a material issue of fact, not requiring an expert opinion and bearing on liability, for consideration by a court or jury.

(2) If the review panel's finding is that set forth in subsection (1)(b) of this section, the panel may determine whether the claimant suffered any disability or impairment and the degree and extent thereof.

(3) The opinion shall be in writing and shall be signed by all panelists who agree therewith. Any member of the panel may note a dissent. All such opinions shall be mailed to the claimant and the health care provider within five days of the date of their rendering.

NEW SECTION. Sec. 25. All proceedings, records, findings, and deliberations of a screening panel are confidential and shall not be used in any other proceedings or otherwise publicized, nor disclosed by any party, witness, counsel, panel member, or other person, on penalty of being found in contempt of court. The manner in which a screening panel and each member thereof deliberates and decides on any matter submitted to it shall not be disclosed or made public by any person. However, the opinion of the panel may be used by a court for the sole purpose of determining whether the lawsuit was frivolous and advanced without reasonable cause as provided in RCW 4.84.185.

NEW SECTION. Sec. 26. The opinion of the screening panel is not binding on the parties unless they have otherwise agreed. If one of the parties rejects the final determination of the panel, the plaintiff may proceed with the cause of action in the appropriate court.

NEW SECTION. Sec. 27. No member of the screening panel shall be subject to a civil action for damages as a result of any action taken or recommendation made by such member acting without malice and in good faith within the scope of the member's official capacity as a member of the screening panel.

NEW SECTION. Sec. 28. The convening of a screening panel shall toll any applicable statute of limitations and the statute of limitations shall remain tolled until thirty days after the screening panel has issued its written recommendations.

NEW SECTION. Sec. 29. Each member of the screening panel shall be reimbursed for actual and necessary expenses and shall be paid at a rate of one hundred dollars per diem for work performed as a member of the panel. Per diem and expenses of the panel shall be borne by the parties in such proportions as may be determined by the chairman in his or her discretion.

NEW SECTION. Sec. 30. Sections 22 through 29 of this act are each added to chapter 7.70 RCW.

NEW SECTION. Sec. 31. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.