The Doctors’ Insurance agency has 10 malpractice insurance representatives working hard to find the right coverage for healthcare facilities, physicians, aesthetic technicians, wellness professionals, surgery centers, urgent care centers and hospitalists across the country. And while mid-level providers, adult care providers, hospitalists and urgent care represent fast-growing niches - telemedicine seems to be surging ahead of them all. In fact through telemedicine technology - doctors can supplement their work schedule adding more flexibility and additional income.
Telemedicine groups are now providing medical services in hospitals, skilled nursing facilities, adult healthcare clinics and urgent care centers to it is entirely consistent that telemedicine is growing in part fueled by these lower costs more efficient healthcare organization models.
According to Modern Health care (an online business, news and research letter), Telehealth is exploding.
Telehealth services surging despite questions about value
By Darius Tahir | February 21, 2015
The business of offering consumers virtual visits with physicians is booming even as questions about the quality of care and cost effectiveness of those services remain unresolved.
American Well, a Boston-based telehealth firm, raised $81 million in December.
Dallas-based Teladoc, which offers access to doctors through voice or video, raised $50 million in September. Over the summer, San Francisco-based Doctor On Demand raised $21 million. And MDLive started the year with a $23.6 million infusion from investors. Other virtual-visit firms also benefited from the flood of investor interest. Researchers at Mercom Capital Group estimated a 300% increase in funding flowing toward established and startup virtual-visit firms.
Conventional Individual Doctor Telemedicine Malpractice Insurance
One method of calculating premium for telemedicine doctors is simply to issue an individual policy. This is not unlike conventional clinical medical malpractice insurance issued by the physician insurance Association companies- almost always claims made, where there is a progression of premium over the first five years and ultimately when there's a cancellation of the policy- there is a tail premium.
Tail insurance can cost from 100 to 250% of the expiring UNDISCOUNTED premium. One important detail to understand is that expiring premium is often discounted heavily even as much as 50%. This could increase the real cost of tail significantly. You can imagine if your premium is discounted by 50% gross that amount up and then multiply that by two. Indefinite tail policies are expensive and should be carefully considered when you're purchasing an individual telemedicine malpractice insurance policy.
Because of the high cost of tail telemedicine groups can find it difficult, in fact prohibitively expensive to recruit. For this reason, The Doctors Insurance Agency has been working with The Doctors Company, Admiral Insurance, Medical Protective and the innovative Kinsale Insurance to develop group telehealth programs that provide the important rolling tail endorsement. Rolling tail essentially means that you can recruit doctors and tell them confidently that there claims will be covered when they cancel the policy without incurring a tail premium.
Similar to the innovative emergency medical group policies, which had challenges that resembled staffing and administrative issues around telemedicine groups, these policies develop the premium by counting the number of consultations just as emergency medical practice policies count the number of visits. Going further inside the numbers the emergency medical policies even break down the premium according to the kind of services provided. Telemedicine groups at this point contemplate the states in which the services are provided specialty of services and of course the number of consultations.
This is one method of purely rating the group rather than counting and adding premium by the number of doctors. And as referenced above, the coverage continues when the doctors cancel. In fact many of our telemedicine groups build a roster of doctors much like a locum tenens staffing organization and they assign consultations to them when it is convenient and necessary. This kind of flexibility makes a startup telemedicine organization possible. Without contemplating the cost of tail, telemedicine groups would have a much more difficult time in their first years of business.
Back to the Modern Health care article
All indications point to Telehealth as a model that is here to stay. Advocates of the virtual-visit model argue that expanding access to telehealth services would reduce costs by heading off more expensive urgent care and emergency department care, and that consumers increasingly will substitute virtual visits for in-person visits so that the total amount of services will not rise.