When's the last time you reviewed your malpractice insurance? If you haven't done so in the past few years, it's probably time to see if your coverage meets the current needs of your medical practice and you're getting the best price for your coverage.
According to a study by Medical Liability Monitor, after steep rate hikes in 2003 through 2006, rates have steadily, if not spectacularly, declined since 2008. The study revealed that premiums fell by roughly 20% for general surgeons, OB-GYNs, and internists, possibly due to tort reform legislation at the state level that limits the amount of non economic damage awards in malpractice claims.
All that's good news, especially when many practices are looking for ways to trim margins and increase profitability. If you're ready to shop your malpractice coverage, here are some tips and strategies for getting the best rates.
Use competitors' quotes for leverage
Even if you are happy with your existing carrier and policy, it never hurts to request quotes from competing carriers to negotiate a better deal for your current coverage. If they can't budge on premiums, look for value-added services such as cyber attack coverage, business interruption insurance, errors and omissions coverage (especially in the event of a RAC audit), or even risk-management training courses that also count as CME for providers. And if competitor rates are especially attractive, don't be afraid to make the switch.
Evaluate malpractice coverage limits and sublimits
Unless your practice has remained relatively static and stable for the past several years, you may need to revisit your coverage details. Are you doing more or less procedures? Are they the same types of procedures or have they changed over time? Have you brought on new staff or joined an agreement with a new health care organization? These details should be factored into your policy premium.
Also look for emergency medical expense, or EME coverage, as a sublimit in your policy. This coverage pays restitution to a patient for minor accidents and incidents during care without the need for a lawsuit. For example, if you accidentally damaged a patient's tooth while providing treatment for a jaw injury, EME coverage would cover the cost of fixing the patient's tooth and compensate him or her for other expenses.
Ensure your policy reflects the realities of care in the 21st century
More practices are adding telemedicine to their menu of services; if you are virtually seeing patients in another state or jurisdiction, your existing policy may not cover you for those services.
Team-based care is also becoming the norm, with physicians from different locations collaborating to treat patients. It's important to make sure all providers have their own malpractice coverage, and that in any lawsuit naming multiple providers, each clinician's carrier represents him or her so that your practice doesn't assume liability for all team members.
Be sure your policy gives you the power to decide whether or not to defend against a malpractice suit; in many cases, an insurance company may want to settle even if you feel that you have a strong case. Also look for the ability to choose your own counsel in the event of legal action, because some policies specify that the carrier chooses legal representation.
Financial stability is a key factor in choosing a malpractice carrier
With policy limits in the 1-3 range for most specialties, and even 2-6 for high risk ones, a smaller carrier could be financially devastated with just a few high-dollar claims in a particular year.
A good broker specializing in malpractice insurance is often better positioned to scour the market for you and find the best deals with top rated companies. Be sure to watch for coverage gaps if you do make a switch, with special attention to how claims made on incidents that occurred while you were covered by your previous policy will be handled after the switch.