Aimed primarily at those who build up massive credit - card debt, the bill would limit the money that could be protected in a home and retirement accounts - and would require persons with above -average income to pay off debts over some years even if they declare bankruptcy.

It could have a big impact in South Florida because about a third to half of the doctors in the area don't have malpractice insurance, and most of them have sought ways to protect their assets so that they can go into bankruptcy if they are hit with a large judgment.

The bill has been approved by the Senate and is expected to pass the House in the next several weeks. President Bush has already said he would sign it into law.

If that happens, doctors say that could put a horrific squeeze on them. '"You could see quite a few doctors retire or move to another state,'" says Gary Gieseke, a Broward neurosurgeon who has no insurance.

Plaintiffs' attorneys see things differently. Miami lawyer Neal Roth applauds the Congressional effort. "The system should be much more equitable so that the injured patient can at least get some substantial relief."

Robert J. Mills of the American Medical Association says the AMA has taken no position on the bill because it appears to affect few in its membership. "There seems to be a lot of unrest among physicians . . . in and around southern Florida. .. But we're not hearing from anyone else in the country."

The reason is that physicians in most other areas of the country have more affordable malpractice premiums.

THE UNINSURED

Gieseke says he knows a Broward neurosurgeon who recently moved to California, where he pays $38,000 a year for $1 million coverage. Here, if they can get insurance, many surgeons face paying $150,000 to $200,000 for $250,000 of coverage. Most opt to "go bare" and drop their policy.

What's more, a state survey shows 60 percent of those who do buy insurance get the minimum $250,000 - not much protection when major malpractice judgments can run into the millions.

"Any doctor in that kind of situation would be incredibly irresponsible not to have a plan to protect his life savings," says Marc Singer, whose Coral Gables wealth management firm Singer Xenos has 450 physicians as clients, including neurosurgeon Gieseke.

High malpractice premiums may mean "Florida is the worst state to practice medicine," says Singer, but "it is the best in the country, bar none" in allowing persons to protect assets from bankruptcy.

The state has several provisions few others have: A person's home, insurance, annuities and retirement accounts are safe from creditors, no matter how much money a person has invested in them. Only Texas comes close to this, says Singer.

The Florida homestead provision has led people like former baseball commissioner Bowie Kuhn to buy expensive mansions in Florida just before filing bankruptcy elsewhere.

Singer says he gives doctors three basic pieces of advice: Put as much money into your home and retirement fund as possible, and transfer as much of the rest as possible to the spouse.

CREDIT CARDS

Two of those three recommendations could be endangered by the new legislation, which has been pushed heavily by credit card companies, seeking to recover at least a portion of what they lose in bankruptcy proceedings.

But some provisions target the well-to-do. One would allow a debtor to protect no more than $125,000 in a home if it was purchased within 40 months of bankruptcy. Singer notes malpractice cases often take a long time to resolve, so doctors can probably work around that.

Another provision would not protect anything over $1 million in Individual Retirement Accounts.

That could threaten older doctors who have built up large nest eggs and could force them to retire earlier than they planned, says Gieseke.

Specifics about this provision are still not clear, and some other kinds of pension funds could still have unlimited protection.

The biggest change in the bill is a clause that means those with family incomes above $58,000 in Florida may be forced out of Chapter 7 of the bankruptcy law, which wipes the slate clean, into Chapter 13 or 11, which requires debtors to come up with a plan to repay at least part of their debt over the next five years of income.

How much is enough?
Singer's fear is that a judge might order a doctor to pay $150,000 a year or more of his $200,000 salary to satisfy a huge claim. "That might force him out of business," Singer says.

However, Jeff Morris, resident scholar at the American Bankruptcy Institute, says judges must allow debtors certain acceptable levels for living expenses, although not necessarily the standard of living doctors are used to.

Roth and other attorneys who pursue malpractice cases think it's an outrage that highly paid doctors aren't forced to pay when their errors ruin the lives of their patients. '"The doctor has a moral, ethical and financial responsibility," Roth says.

HUGE JUDGMENTS
Gieseke the neurosurgeon says, "If a doctor did something really bad that was definitely malpractice, I think he ought to pay for it. But a lot of times there is just a poor outcome in which everyone did everything they could," and still the doctor gets stuck with a huge judgment.

Gieseke says he knows of three Broward neurosurgeons who have left the state because of the malpractice costs here, and three others who have gone to work for large institutions, which assumed their malpractice risk. He says he knows of only five neurosurgeons remaining in private practice in Broward, and that number could keep shrinking.

SETTLEMENTS
Experts agree the new law is likely to change the playing field. At present, both Roth and Singer say bankruptcy is usually a threatened backdrop to possible litigation that never materializes. Singer says many doctors offer to settle for up to $250,000, which the state requires them to pay in liability cases in order to keep their licenses, and attorneys often accept settlements rather than go to trial against uninsured doctors and face getting nothing if the doctor goes bankrupt.

Under the new law, in which the doctors' future income can be targeted, Singer says '"attorneys are likely to become more aggressive'" in pursuing lawsuits.

Says Roth, the attorney: "That's not a bad thing."


Further Reading: How the New Bankruptcy Law Will Affect Florida Physicians

Singer Xenos does not provide legal advice. Please consult with your own legal counsel.