January 13, 2017

The Honorable Governor of Missouri State Capitol 201 West Capitol Avenue Jefferson City, MO 65101-1556

Dear Governor Greitens:

We are the members of the Board of Trustees of the Missouri Hospital Association. We write you today to express the vital importance to Missouri’s hospitals of restoring a liability protection that was put into state law in 2005 but undermined by a 2014 court ruling.

The court ruling is spawning dramatic increases in liability exposure and medical malpractice insurance premiums. Those increased premiums drive up health care costs, both for patients and businesses that buy employee health insurance coverage for workers and their families.

The ruling is having an adverse effect on Missouri hospitals even more substantial than past issues such as the loss of caps on noneconomic damages.

The effects of the case are daunting. But the ruling itself is based on a legislative drafting error.

When the General Assembly enacted medical liability reform legislation in 2005, it revised the law to specify that providers would not be held liable for the actions of those who are not their employees. However, the enactment defined the term “physician employee” but did not use that term elsewhere in the law. Instead, the law used the term “employee.”

In its Jefferson v. Missouri Baptist decision, the Eastern District Court of Appeals used the discrepancy to justify applying a significantly broader standard for imposing liability for the actions of nonemployees. In doing so, the court expanded the liability of hospitals and other organizations for the actions of physicians and other practitioners who are not their employees. The decision has established a legal precedent that all state courts are following.

The Missouri Hospital Association will be promoting legislation to restore the original intent of the 2005 medical malpractice reform law. Senator Caleb Rowden has introduced Senate Bill 237. Representative Kevin Austin has introduced House Bill 452.

In 2017, the Missouri General Assembly should reinstate this liability restriction. Doing so will restore what their legislative counterparts in 2005 and then-Governor Matt Blunt intended to do before their work was reinterpreted by the court. We urge your active engagement. The Honorable Eric Greitens January 13, 2017 Page 2

Sincerely,

C. Todd Ahrens, ACHE Hannibal Regional Healthcare System Jon D. Doolittle Northwest Medical Center

Donald J. Babb Citizens Memorial Hospital Steven D. Edwards, CHE CoxHealth

Paula F. Baker Melinda L. Estes, M.D., MBA Freeman Health System Saint Luke’s Health System

Steven C. Bjelich, FACHE-D Saint Francis Healthcare System Tim Glasscock, Board Chair Golden Valley Memorial Healthcare

Darrel Box, ACHE Lafayette Regional Health Center Alan W. Greimann

Royal Oaks Hospital

Christine M. Candio, R.N., FACHE St. Luke’s Hospital Christopher D. Howard SSM Health

Patrick E. Carron, MHA, FACHE

Perry County Health System Donald L. James, D.O. Phelps County Regional Medical Center

The Honorable Eric Greitens January 13, 2017 Page 3

Jeffrey A. Johnston Mercy Hospital St. Louis Randall L. O’Donnell, Ph.D. Children’s Mercy Kansas City

Thomas Keim Julie L. Quirin, FACHE Ste. Genevieve County Memorial Hospital Saint Luke’s Health System

Herb B. Kuhn Peggy F. Schmitt Missouri Hospital Association North Kansas City Hospital

Mel Lagarde Charles Shields HCA Midwest Health System Truman Medical Centers Inc.

Mark Laney, M.D. Mosaic Life Care Jon D. Swope Mercy Central Region

John Christopher Lang, FACHE Cass Regional Medical Center Laureen K. Tanner, MSN, R.N., FACHE Ranken Jordan Pediatric Bridge Hospital

Steven H. Lipstein Mitchell L. Wasden BJC HealthCare MU Health Care

William K. Mahoney, FACHE Cox Medical Center Branson