Medical Malpractice Insurance is essential for any Physician wanting to protect themselves from the devastating expenses associated with liability litigation. Every year over 7% of your Physician colleagues are named in a malpractice claim(1). While not all claims lead to indemnity payments, it is critical to have the best policy in place to cover any costly legal fees that may arise. This is true whether you are a Physician seeking independent coverage or considering an employer provided Malpractice Insurance policy.
1. Physician Medical Malpractice Insurance
According to the National Practitioner Data Bank, in 2017 there were over 11,200 malpractice related payouts made in the United States. Many of these claim payments fell between $50,000- $999,000 with some 160 of these cases topping 2 million dollars in awards*. These numbers illustrate how critical it is to understand the types of policy coverage and how they can affect your asset protection.
Occurrence-Based Policy
This policy type covers any claims made against you during the effective policy period. This means that even though a policy may have expired, if the reported event occurred during the coverage period it is covered. An occurrence-based policy provides the most comprehensive coverage and is frequently the most expensive.
Claims-Made Policy
This type of policy covers any claims made against you if it meets these 2 qualifications: both the treatment and the claim were reported during the time your policy was in effect. This coverage is less comprehensive than occurrence-based coverage and it is suggested that a "tail policy" be added for comprehensive protection.
Tail Coverage
This type of policy is frequently added to a claims-made policy to ensure that you have continued coverage for a specified period after ending a policy or leaving an employer. It will provide coverage for any claims that may arise after the claims-made policy ends.
2. Cost
The cost of a Malpractice Insurance policy can vary considerably based on your geographic practice area and medical specialty of choice. Higher risk specialties like OB-GYN and Surgical specialties should expect to pay notably higher premiums due to the increased risk for litigation related to their specialties. According to a 2016 AMA Survey, annual policies can top over $200,000 for some OBGYN's practicing in the New York area whereas practicing Internists in the same area pay around $33,000(3). Such discrepancies in policy pricing are also noted in relation to a Physician's practice location with some OBGYN's in California only paying $49,804 for annual premiums(3). While many consider premiums to be sizable, there is some good news in that premium pricing has been steadily decreasing over the last decade(2).
3. There Are New Risks to Consider
Technology is working its way into everyday medicine and with it comes new threats. HIPAA infractions, cyber hacking and EMR issues can lead to expensive litigation issues that were once unheard of. These changes in technology have given rise to cyber liability policies. Cyber policies provide technology-related coverage that may be especially helpful to solo Physicians or small group practices that lack teams of lawyers to handle such issues.
4. Your Employer Coverage May Not Be Enough
Your employer is often looking out for their bottom line, not yours, so make sure you have the proper insurance coverage. Employers can save money by sharing policies within the group or reducing coverage levels. These changes may leave you vulnerable and needing supplemental coverage so be sure to investigate all of your options before signing.