MediSpas and Plastic Surgeons - Malpractice what is covered?

Expanding a Practice as a Plastic Surgeon for additional practice revenue is a very common business  move in this practice environment.

The assumption is often made (taking sort of the oft referenced  military philosophy in regards the practice coverage issue: Don’t Ask Don’t Tell (your insurance carrier that is).  Plastic Surgeons (and other specialties for that matter) pay enough in premium right?, surely, as long as “I’m practicing within my specialty what does it matter where I do this”.  The fatal mistake here is that Plastic Surgeons end up forming many alliances in which they do not have an ownership position, they are asked to provide the obligatory Medical Director Services, asked to hang this extra risk on to their malpractice policy; thereby saving the Medispa owners the nominal premium that it would have cost to insure everyone and everything properly.

 Non Ownership Alliance with MediSpa

Recently a Plastic Surgeon asked us if he was covered to begin seeing patients at a MediSpa that is owned by a Chiropractor. He asked whether his services and supervision at the Medispa would be covered under his medical malpractice insurance policy if he expanded into a satellite office where an existing medispa existed under the ownership of a chiropractor.

His practice would be there a few times per month seeing patients, consultations and possibly doing some office procedures. He was  also signing a contract to  assume the medical directorship of the medi spa but without salary. 

Well, running this by an experienced underwriter for medical malpractice insurance, the issue was: does this represent an unfair and ill-advised expansion of risk and responsibility:  If the revenue is there, it  makes sense: seeing patients, doing consults and aesthetic procedures as well as taking on medical director responsibilities; and, there has to be some way to address the additional risk.

Insuring the extra Exposure of working with a Medi Spa:

In general, under your medical malpractice policy you are covered for all your clinical work for your private practice patients. If the clients you see at the medispa are billed under your name and not the name of the medispa, then there is no question that your Medical Malpractice coverage will respond; it is important to remember that there is no coverage at all for the Medispa or its employees under you separate medical malpractice policy.

Medical Director ‘Stand Alone’ Policies (inexpensive and important coverage).

The Medical Directorship is also not automatically covered under your Malpractice policy.  You would have to request it and have it underwritten (providing proof that the facility and all of its employees are fully covered) and then there would be an additional premium charge of approximately 10%. It's usually cheaper to have the MediSpa add Medical Director Coverage for you under their own policy.  It's also recommended that they endorse you under their professional liability coverage so their policy will respond in the event that the spa is named in any claim against you.

In the area of medical malpractice issues; when you’re considering any expansion of services or additional locations (even ‘just medical director or mentoring, supervising or teaching) it is so important to inform your Carrier or Agent so that the simple endorsements can be added.

 

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