State Refuses Malpractice Liability On Veterans Home

By Doug Thompson
The Morning News

The purchase of medical malpractice insurance covering the Fayetteville Veterans Nursing Home would be banned under a budget amendment adopted Monday, specifically rejecting a condition set by Washington Regional Medical Center in the home’s lease.

The amendment to Senate Bill 449 by the Joint Budget Committee reads: “In no event shall the Department of Veterans Affairs expend or transfer any appropriation or fund for the purchase of malpractice liability insurance for the benefit of a nongovernmental entity.”

The 108-bed, state-run home for U.S. armed services veterans pays $11,500 a month for the insurance. The home is in the former location for Washington Regional Medical Center in Fayetteville.

A spokesman for the medical center was not available Monday evening.

The state’s position is that the liability insurance is not needed because the state cannot be sued, said Sen. Dave Bisbee, R-Rogers, author of the amendment. The state rejects Washington Regional’s position that the hospital would be exposed to liability without the insurance because Washington Regional subleases space to the veterans home, he said. Washington County owns the building.

“It’s a state-run home in a county-owned building,” Bisbee said in an interview. “The problem is that Washington Regional has an attorney who doesn’t understand sovereign immunity,” the principle of not being able to sue the government.

Washington County Judge Jerry Hunton said the county’s main concern leasing directly to the state is whether the county would expose itself to the risk of a medical malpractice suit if insurance is not carried.

Asked if the nursing home would have to close, Bisbee replied: “We’ve put that ball in Washington Regional’s court. The bottom line is that the liability insurance is unnecessary and we’re not paying $10,000 a month for it.” The amended bill could be brought to the Senate floor as early as today. A proposal to put facilities for a satellite campus of the University of Arkansas for Medical Sciences in different space in the same building is still open, Bisbee said.

Hunton said one favorable scenario would allow UAMS to come in and let the state rent the building from the medical school.

Leasing space from the former Washington Regional Medical Center site in downtown Fayetteville costs the state $744,036 more a year than it would to run a state-owned building, according to a report by the Division of Legislative Audit. The liability insurance portion of that is $138,000 a year. Leasing the space for the home costs $29,227 a month or $350,724 a year, according to state figures.

Walking away from the nursing home may still be the best financial option even if the state must pay back the federal government $4.7 million used in the $7.1 million renovation, Bisbee said in an earlier interview.
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