Increased Exposure due to the Accountable Care Act:

September 25, 2012

Orthopedic Surgeons, Endocrinologists and Neurologistsare among the many specialties which could see increased patient loads and an increase in the exposure and risk.

In an Article by Crittenden News, Medical Insurance, some insurers (not yet mandated by The Doctors’ Company), could start to requireRisk Management as a condition of insurance.

Recently, The Doctors’ Insurance Agency worked with a Cardiologistswho had seen a similar increased patient load; concurrent with requests my skilled nursing facilities to act as Medical Director. This talented Cardiologist, with extremely authentic, careful bedside manner was bursting with new patients, supervisorial responsibilities and letters asking him to serve as Medical Director; The Doctors’ Company Underwriters can add some oft these additional risks with little or no premium. However, when the percentage of practice acting as an administrator begins to exceed 20 %, the rates are either adjusted, or the Carrier will simply tell him no, we did not contemplate this when binding THIS policy.

The Doctors’ Medical Malpractice Insurance Carriers are paid to be a careful steward of the incoming premiums, preparing for the defense of allegations of negligence during the practice of medicine. The Doctors’ Company carefully reserves premium dollars to account for Incurred but not yet reported claims, because the actuarial science of the inevitability of claims is undeniable. If a company is playing fast and loose with the “House Money” (which is to say, putting immediate first dollars into paying of claims without accounting for the ongoing collection of claims, there will simply be no money available when the time comes to pay the claim.

The increased exposure to Internal Medicinesub specialties will definitely bring about more attention to risk mitigation (and The Doctors’ Company in Napa California has more Risk Managers assisting in physician practices than any other medical malpractice Carrier in the nation. Physicians who choose to remain independent, or in small groups almost inevitably will accept work from contracted organizations, such as Occupational medical clinics, elective health clinics (like Medical Spas) or even something like Telemedicine. If your agency, broker or directmedical malpractice insurance representative does not understand how to add this to your current policy, and when to specifically find a specialty carrier willing to underwrite this, your medical malpractice premium could be effected by outside claims.

Recently, a Plastic Surgeon who had taken on more risk by agreeing to take Trauma, act as a Medical Director and take an ownership position in a Spa, negotiated strongly with his medical malpractice insurance carrier to add these exposures. The good news is: the Insurance Company agreed to add these services; the unfortunate reality was that the physician was named in a claim by the Medispa including accusing him of negligent supervision of the R.N’s and Aestheticians providing the services.

The result was, rather than add this to a separate $ 4,000 policy covering just theMedical Spa he added this risk to his medical malpractice insurance policy. The result was, this laser claim, naming the physician for supervisory responsibility contributing to the claim had to pay a substantial settlement. The net effect on his renewal premium was the loss of a claims free discount, resulting in a $ 4,000 increase in premium which could last for four years.

The point is: it is much more important to insure each portion of your practice separately, if the extent or variance of the work warrants it.

The Doctors’ Insurance Agency specializes in breaking down the different risks and matching them with the right policies.