Could South Carolina’s Patients’ Compensation Fund assess a former member for claims from its membership period?

Plain-English summary

A medical center that had left South Carolina's Patients' Compensation Fund in good standing asked about later assessments and malpractice coverage. The 2000 informal opinion read the statute's reference to “all fund members” as limiting deficit assessments to current members. It said the fund's Board of Governors shared that interpretation and was unlikely to assess former members; the AG deferred to the board's view of the statute it administered.

For a claim made after withdrawal over an incident during membership, the AG advised that the former member would remain covered if appropriate fund coverage had been in place at the time of the incident. That also reflected the board's stated position. On failure to pay an assessment, the AG said expulsion appeared to be the only remedy contemplated by the statute, but only a court could decide whether another remedy was available. The letter did not promise coverage without the stated coverage condition or settle other possible remedies.

Currency note

This opinion was issued in 2000. Subsequent statutory amendments, court decisions, or later
AG opinions may have changed the analysis. Treat this page as historical context, not current
legal advice. Verify current law before relying on any specific rule, deadline, or remedy
mentioned here.

Common questions

Q: Did the AG think a former member still owed new deficit assessments?
A: No. It read the assessment language as referring to current members and followed the board's similar interpretation.

Q: Could a former member have coverage for a claim filed after leaving?
A: The AG advised yes for an incident during membership, assuming the member had appropriate coverage then.

Q: Was expulsion definitely the fund's only remedy for unpaid assessments?
A: The AG said it appeared to be the only remedy contemplated by the statute, while leaving the availability of other remedies to a court.

Background and statutory framework

The opinion answered three separate questions about a provider that had withdrawn in good standing. It compared the assessment and membership language in § 38-79-450 with the board's administrative interpretation. Its coverage answer likewise rested on the board's position and the stated condition of coverage at the time of the incident.

Citations and references

• § 38-79-450, membership fees, deficit assessments and timely payment.
• § 38-79-430, creation of the fund's Board of Governors.

Official title

Regarding questions about the Patients’ Compensation Fund.

Requester

Ernest J. Nauful, Jr., Esquire

Source

• Landing page: https://www.scag.gov/opinions/opinions-archive/september-8-2000/
• Original PDF: https://www.scag.gov/wp-content/uploads/2013/11/00sept8nauful.pdf

Original opinion text

(

The State of South Carolina

OFFICE OF THE ATTORNEY GENERAL
CHARLES MOLONY C ONDON
ATTORNE Y G ENERAL

September 8, 2000
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Ernest J. Nauful, Jr., Esquire
Post Office Box 11866
Columbia, South Carolina 29211

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RE: Informal Opinion
Dear Mr. Nauful,
Thank you for your letter requesting an opinion of the Attorney General ' s Office. As the attorney for The Regional Medical Center of Orangeburg and Calhoun Counties (TRMC), you have some questions about the Patients' Compensation Fund (PFC). I will answer each question in tum. 1) "Under the provisions of Section 38-79-410 through 38-79-470, the TRt\1C , having withdrawn from the PFC in good standing, is it subject in the future to assessments for claims arising from occurrences which took place while it was a member?" The Patients' Compensation Fund was established pursuant to S.C. Code Ann.§ 38-79-410 et seq., for the purpose of paying medical malpractice claims for licensed health care providers in South Carolina. The Board of Governors was created to manage the fund and promulgate regulations necessary to operate the fund. See S.C. Code Ann. § 38-79-430. Although we are advised that no written regulation or policy exists that addresses this question, it is our understanding that the Board of Governors, the entity charged with enforcing this statute, is highly unlikely to attempt to assess former members of the Fund. The plain and ordinary meaning of the language of
§ 38-79-450 (emphasis added), which states that "all fund members" shall pay "membership fees and deficit assessments," suggests that only current members of the PCF are subject to the assessment. We are advised, however, that regardless of legal concerns, for purely practical purposes assessing former members of the PCF would be impossible, as some members are deceased or have relocated out of the state. As a matter of policy, this Office typically defers to the administrative interpretation of the agency charged with enforcement of the statute in question. The agency' s interpretation is entitled to respectful consideration and should not be disregarded absent cogent reasons. In this instance, the Board's conflusion and the tenants of statutory construction concur, and we defer to their opinion.

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Mr. Nauful
September 8, 2000
Page 2of2

2) "Is expulsion from the Fund under Section 38-79-450 the sole remedy upon failure to pay an assessment?"

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Given the answer to question 1 above and the position ofTRt\1C as having withdrnwn from the PCF, this question may be moot. Nevertheless.§ 38-79-450 only provides that ··membership in the Fund is contingent upon the Fund member making timely payment of all membership fees and deficit assessments:' Only a court can decide any other available remedy to the PCF for failure to pay. and this Office cannot speculate on how a court would rule on such a question, but it does appear that expulsion from the Fund is the only remedy contemplated by the statute. 3) "Since TMRC left the PCF in good standing, does it have coverage with the PCF for incidents which occurred while it was a member, even ifthe claim is not made [until] after membership terminated?"

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As you have indicated, the position of the Board of Governors in a correspondence from the Executive Director of the Fund is that the former member would be covered for a claim arising from an incident occurring while it was a member, assuming the member had appropriate coverage in place when it was a member of the PCF. We have again contacted the acting Executive Director of the Fund and are advised that this conclusion remains accurate. As we have noted in question l, this Office will typically defer to the interpretation of the entity charged with enforcement of the statute. As such, we would advise that, in accordance with the position of the Board of Governors. the former member would be covered in these circumstances. This letter is an informal opinion only. It has been written by a designated Senior Assistant Attorney General and represents the position of the undersigned attorney as to the specific question asked. It has not, however, been personally scrutinized by the Attorney General not officially published in the manner of a formal opinion. With kind regards, I remain Very truly yours,

Assistant Deputy Attorney General