Hospitals are looking for cost savings

April 02, 2012

In this environment of integrated delivery systems, it is widely reported that hospitals will start to look for risk management and diversification methods of spreading the risk among different malpractice, professional liability insurance carriers. It is, perhaps improbable to retain all of the risk and expense and indemnity for the hospitals, the employed ancillary medical providers, the entity, the facilities, in patient, rehab, specialty care, imaging centers, tertiary care units and physicians all with the same insurance carrier. This is the kind of single basket strategy that pushed the insurance companies far below the profit line in the early 2000’s.

The Doctors’ Insurance has been working hard to develop relationships with excess and surplus lines carriers, Lloyd’s and of course, The Doctors’ Company, which can handle many of the above. We can help hospitals find the specialty niche insurance carriers to cut their cost and not set each insurance company up for failure. There is a difference in the risk pools, there are reasons to separate the coverage from one insurance company to another.

There is a school of thought that the cost savings of a single carrier is essential in the race to cut costs and retain the risk, turn a profit and build the healthcare system. Willis Healthcare recently was quoted in a newsletter stating that it is this reluctance to layer the risk and the drive to push premiums down with a single carrier that foreshadowed the withdrawal of St. Paul and ERC from Medical Malpractice insurance.

The Doctors Insurance Agency working through The Doctors’ Company is single focused, exclusively working to place the physicians with The Doctors’ Company and placing the facilities with the matching carrier given size and risk composite. It takes disciplined knowledge about how much risk to take on and what to pass on to specialty carriers.

To be sure, The Doctors Insurance Agency is a strong advocate for physician discounted, reduced rates and properly advising when their associated entities should share a limit of insurance and cut cost. Just working with an agency like ours, with ten licensed, experienced agents, national access to surplus lines, specialty carriers through our close affiliations with World Wide Facilities and Rubicon Insurance, working with eight TDC agents who understand when and where and why to discount, discounting physicians’ premiums appropriately, working with our agency can save money and increase insurance coverage.

Not knowing about an endorsed discount that is available can cost physicians thousands of dollars over years. Unnecessarily jumping from insurance company to insurance company, giving up dividends, Tribute Equity and underwriting goodwill can be costly, leaving money ‘on the table’ and risks exposed.

We agree and understand that the ‘soft market’ is still here, that hospitals are purchasing practices, out of state ‘multi state companies are purchasing the assets and consolidating, impossibly at times, interstate practices, and, still one thing remains essential, the physician needs the best coverage, separate from the facilities and entities and they need to be smart, saving money if possible.

There has never been a better time to work with a physician specialist, facility knowledgeable insurance agency like The Doctors’ Insurance Agency

We have been providing facilities, medical entities, ancillaries, integrative healthcare and physicians and surgeons medical malpractice insurance for over 30 years. This is a unique time when companies’ excess surplus and reserve redundancies will support the low rates,

And then what..?? Rates are likely to go up, ironically, just one year after the State of California mandated rate reduction.

We are ready to negotiate premium discounts for your medial malpractice insurance policies, and to help hospital owned policies find that fine line between affiliation and benefit and risk reduction, premium savings while drawing the line between the vicarious liability that is brought to them from the hospital staff.