What Is the MCARE Act in Pennsylvania? Coverage, Safety, and Lawsuits

The MCARE Act in Pennsylvania, formally the Medical Care Availability and Reduction of Error Act, is the 2002 state law that governs medical malpractice across the Commonwealth. Signed as Act 13 on March 20, 2002, it responded to a liability-cost crisis that was pushing physicians out of the state.¹ The law does two things at once. It requires every doctor and hospital to carry minimum amounts of malpractice insurance, backed by a state-run secondary coverage fund, and it rewrites the procedural rules for how malpractice lawsuits are filed and tried.

Insurance Every Provider Must Carry

Section 711 sets a tiered minimum for professional liability insurance as a condition of practicing in Pennsylvania. For policies issued or renewed from 2006 onward, a participating non-hospital provider must carry at least $750,000 per occurrence and $2,250,000 per annual aggregate. The statute also contains a built-in jump to $1,000,000 per occurrence and $3,000,000 per annual aggregate once the Insurance Commissioner confirms adequate market capacity.²

Hospitals carry more. At the 2006 tier, a hospital must carry at least $750,000 per occurrence and $3,750,000 per annual aggregate, rising to $1,000,000 per occurrence and $4,500,000 per annual aggregate at the top tier. Nonparticipating providers, meaning those who opt out of the state fund, must carry $1,000,000 per occurrence and $3,000,000 per annual aggregate regardless of tier.²

Letting this coverage lapse is not treated as a paperwork problem. Failure to maintain the required levels can result in suspension of a provider’s right to practice medicine in Pennsylvania. Most providers get their primary coverage through private carriers or through self-insurance plans approved by the Pennsylvania Insurance Department.

The MCare Fund: A Secondary Layer of Coverage

Sitting on top of that primary insurance is the Medical Care Availability and Reduction of Error Fund, a state-administered pool that pays claims against participating providers for damages above their primary limits.³ The fund’s liability is capped at $500,000 per occurrence and $1,500,000 per annual aggregate per participating provider.⁴

Participating providers finance the whole thing through annual assessments. For 2025, the assessment was 29% of the prevailing primary premium for each provider, calculated against the schedule of occurrence rates approved by the Insurance Commissioner for the Joint Underwriting Association.⁵ Because the assessment follows risk-adjusted premium schedules, a surgeon in a high-risk specialty pays substantially more into the fund than a family physician. The fund also acts as a backstop if an annuity provider funding periodic payments in a malpractice judgment becomes insolvent.

The Patient Safety Side of the Law

The Act’s second half is often overlooked. It created the Patient Safety Authority, an independent state agency, and built a mandatory reporting system around it.⁶ Every medical facility in the Commonwealth must report two categories of events:

Serious events: situations involving a patient’s clinical care that result in death or an unanticipated injury requiring additional treatment the patient didn’t originally need.
Incidents: situations that could have injured a patient but didn’t, meaning the near-misses that reveal systemic problems before they cause harm.

The two categories are mutually exclusive by statute: an incident does not include a serious event, and vice versa.⁷

Every facility must designate a patient safety officer and develop a written patient safety plan. The officer sits on the facility’s patient safety committee, ensures that reported events and incidents are investigated, takes immediate action when an investigation reveals a danger to patients, and reports back on corrective steps.⁸ The idea is to catch patterns in near-misses before they turn into the catastrophic errors that generate lawsuits.

How the Act Changed Malpractice Lawsuits

MCare also rewrote the procedural rules that govern malpractice litigation in Pennsylvania. If you are thinking about suing, or being sued, these are the pieces that matter most.

Certificate of Merit

Before a malpractice case gets far, Pennsylvania Rule of Civil Procedure 1042.3 requires the plaintiff’s attorney to file a Certificate of Merit with the complaint or within 60 days of filing it. The certificate attests that a qualified licensed professional has reviewed the case in writing and concluded there is a reasonable probability the defendant’s conduct fell below the accepted standard of care.⁹ Courts dismiss cases where the certificate is late or missing, and the 60-day window is enforced strictly. The practical effect is that plaintiffs have to pay for an expert review before the lawsuit even gets going, which filters out cases where the outcome was bad but the care was not negligent.

Expert Witness Qualifications

At trial, any expert testifying about a physician’s standard of care must hold an unrestricted medical license, be engaged in active clinical practice or teaching (or have retired within the past five years), and be substantially familiar with the standard of care at issue as of the time of the alleged breach.¹⁰

The Act adds a same-specialty rule. The expert must practice in the same subspecialty as the defendant physician, or in one with a substantially similar standard of care for the treatment at issue. If the defendant is board certified, the expert must hold board certification from the same or a similar board. A judge can waive the subspecialty and board-certification requirements where the expert has sufficient training, experience, and knowledge from active involvement in the relevant field within the past five years, and can also waive the subspecialty match when the defendant was providing care outside their own specialty.¹⁰ Showing up with an expert from the wrong specialty is one of the most common grounds for excluding testimony in Pennsylvania malpractice cases.

The Collateral Source Rule

Under Section 508, a patient generally cannot recover damages for past medical expenses or lost earnings to the extent those losses were already covered by a private or public benefit received before trial. If your health insurer already paid your hospital bills, you cannot collect that same amount again from the defendant.¹¹ The statute carves out several categories that are not offset:

Life insurance, pension plans, profit-sharing plans, and other deferred compensation.
Social Security benefits.
Government benefits with federal reimbursement rights, such as Medicare and Medicaid.

There is a trade-off for plaintiffs. The statute also eliminates subrogation rights for the benefits that do get offset, so a private health insurer whose payments reduced the award cannot then demand reimbursement from what the plaintiff recovered.¹¹

Punitive Damages

Section 505 allows punitive damages only for willful or wanton conduct or reckless indifference to the patient’s rights. Gross negligence alone is not enough, and the statute says so explicitly. When punitive damages are awarded against an individual physician, the amount cannot exceed 200% of the compensatory damages unless the plaintiff proves intentional misconduct. There is also a floor: punitive damages cannot be less than $100,000 unless the jury returns a lower figure. Of any punitive award, 75% goes to the plaintiff and 25% is paid into the MCare Fund.¹² A healthcare entity cannot be hit with punitive damages solely because it employed the person who caused the injury; vicarious liability for punitives requires proof that the entity knew about and allowed the conduct.

Periodic Payment of Future Damages

Large verdicts in Pennsylvania do not always result in one lump-sum check. Under Section 509, future damages for medical and related expenses are paid as periodic installments, and the jury can vary the annual amounts across the claimant’s expected lifetime to reflect different anticipated costs in different years.¹³ Payments accrue in the years the jury determines the expenses will arise, generally in equal quarterly installments due on the first day of each month. Interest does not accrue on a payment before it is due, but the legal rate kicks in immediately if a payment is late. Each defendant must fund its share through an annuity, trust, or other court-approved funding plan, and only insurers with the highest claims-paying ratings are eligible to provide those annuities.

There is an important opt-out. If the claimant objects to periodic payments and certifies that total future medical damages, without reduction to present value, do not exceed $100,000, the court must award those damages as a lump sum.¹³ For catastrophic injury cases with lifelong care needs, periodic payments are the default, and the liability to pay them terminates on the claimant’s death.

Deadline to Sue

A medical malpractice lawsuit in Pennsylvania must be filed within two years. The deadline comes from the state’s general personal injury statute of limitations, which requires that actions for injuries caused by another’s negligence be commenced within two years of when the claim accrues.¹⁴

When the clock starts is the harder question. Pennsylvania applies the discovery rule: the two years begins when the patient discovered, or reasonably should have discovered, both the injury and its possible connection to medical negligence. That matters in cases where the harm is not immediately apparent, like a surgical sponge left inside a patient that does not cause symptoms for months or years. Courts expect reasonable diligence. If warning signs appear and a reasonable person would have investigated, courts treat that moment as the start of the clock even if the patient did not actually investigate. Missing the deadline almost always ends the case, no matter how strong the underlying claim.

1
Pennsylvania Department of Health. Medical Care Availability and Reduction of Error (Mcare) Act
2
Pennsylvania General Assembly. Pennsylvania Statutes Title 40 P.S. Insurance 1303.711
3
Pennsylvania Insurance Department. Medical Care Availability and Reduction of Error Fund
4
Pennsylvania General Assembly. Medical Care Availability and Reduction of Error (Mcare) Act – Section 712
5
Pennsylvania Insurance Department. 2025 Assessment Rating Information
6
New York Codes, Rules and Regulations. Pennsylvania Code 40 P.S. 1303.303 – Establishment of Patient Safety Authority
7
Pennsylvania General Assembly. Medical Care Availability and Reduction of Error Act – Chapter 3
8
Pennsylvania General Assembly. Medical Care Availability and Reduction of Error (Mcare) Act – Sections 307 and 309
9
Pennsylvania Code and Bulletin. 231 Pa. Code Rule 1042.3 – Certificate of Merit
10
New York Codes, Rules and Regulations. Pennsylvania Code 40 P.S. 1303.512 – Expert Qualifications
11
Pennsylvania General Assembly. Pennsylvania Statutes Title 40 P.S. Insurance 1303.508
12
New York Codes, Rules and Regulations. Pennsylvania Code 40 P.S. 1303.505 – Punitive Damages
13
Pennsylvania General Assembly. Pennsylvania Statutes Title 40 P.S. Insurance 1303.509
14
Pennsylvania General Assembly. Pennsylvania Consolidated Statutes Title 42 Section 5524 – Two Year Limitation