Physicians buy medical malpractice insurance to give them peace of mind. Most hope they will never have to use it, but they know it’s there to protect their practice and personal assets if a lawsuit should arise. But did you know that physicians face many risks that may not be covered by a malpractice insurance policy?
Does your malpractice insurance policy cover the following exposures?
- Acts as a medical director
- Nurse practitioners working under your supervision
- Cyber liability
- Billing errors or Medicare/Medicaid fraud
- HIPAA violations
- RAC Audits
Typically there is no coverage for these risks in a malpractice policy. That’s because med mal coverage is simple liability insurance. It covers a physician for direct patient care and there are usually no bells or whistles. So unless you have seen policy language that specifically includes coverage for additional risks, you probably don’t have it.
So where do you go to find coverage for these risks? If, for example, you are a medical director at a hospital or nursing home, the first place you should look is the contract you’ve signed for that position. Many hospitals and nursing homes provide coverage for their medical directors. If they don’t you could be at risk if you are named in a malpractice lawsuit. There are policies available at a reasonable cost for medical directors. If the entity doesn’t cover you, make sure you talk to your broker about getting a separate policy.
Increasingly, physicians are employing or contracting with nurse practitioners to help handle the volume of patients and to bring in additional revenue. Experts predict this trend will continue to grow as more and more previously uninsured consumers enter the healthcare system. The additional help from a nurse practitioner, physician assistant, or other ancillary provider can take some of the stress out of the day-to-day life in a busy practice. But malpractice insurance policies often don’t include coverage for these employees or independent contractors. And it’s never automatic.
Many insurance companies will add coverage for ancillary providers if they are included by name in the original application and only if they are employees – not independent contractors – of the physician or group. It’s a good idea to discuss this coverage with your broker because each insurance carrier handles these situations differently. During the course of the year, if a nurse practitioner is added or leaves your practice you should notify your broker of the change. Some carriers will add coverage for free and some will charge an extra premium. Others will not cover such exposure at all and may specifically exclude coverage for any licensed non-physician healthcare provider.
If your policy doesn’t cover this type of risk, you can buy a separate policy. Many physicians require the nurse practitioner to purchase the coverage as a condition of employment. When hiring an independent contractor you need to make sure they have their own policy and require proof of coverage before they see patients. This can also create an exposure of vicarious liability for the corporation which needs to be addressed.
News stories of “Cyber Liability” are popping up every day in most industries. Healthcare is no exception. You have electronic files that include legal name, date of birth, social security numbers and more on all patients. Because of the amount of important personal information that healthcare providers have from their patients, medical practices are even more vulnerable to cyber liability than other businesses. Are you covered if a hacker breaks in to your computer system and steals vital information? When a physician or employee loses a laptop they’ve taken out of the office does your malpractice insurance cover you? Even if the information doesn’t get into the wrong hands there are rules and guidelines that must be followed to protect patients’ information if there has been a compromise. Notifying patients of the problem is just one of many steps that can cost thousands of dollars and man-hours. Talk to your malpractice insurance broker to find out if your policy includes any coverage for this risk. Some carriers are beginning to add coverage up to a certain limit for cyber liability but the limits are often too low. You can increase the limit up to $1,000,000 for additional premium. If your policy doesn’t include this coverage you should buy a separate policy.
With the U.S. healthcare reform and implementation of the Affordable Care Act the federal government is focused more than ever on finding Medicare and Medicaid billing errors and HIPAA violations. Physicians, medical groups, and hospitals have been the targets of Recovery Audit Contractors (RAC) working for the Centers for Medicare and Medicaid Services (CMS). These contractors have recovered billions of dollars from billing errors and overpayments. Even if the errors are unintentional practices are faced with repayment of funds and severe fines and penalties. Would your practice be adequately covered by a malpractice insurance policy for this type of exposure? Probably not. Again, some companies are starting to include coverage for RAC audits, HIPAA violations and the resulting fines or penalties, but at a low limit. You need to talk to your broker about increasing the limits or purchasing a separate policy if you don’t have this coverage.
There are several national insurance carriers that offer coverage as a package policy for cyber liability, RAC audits, HIPAA violations, and loss of data. The liability limits are usually $1,000,000. The cost for these packages is usually very reasonable and the coverage is an important part of managing the risks of a medical practice. You cannot purchase this type of coverage directly on your own. Ask your broker to get you a quote and help you apply.
The experts at eQuoteMD are qualified to discuss the details of these risks and to help you find the best way to protect yourself and your practice. We provide doctors with insurance solutions for every specialty and every state. We have access to many “A” rated companies providing medical malpractice insurance and other professional liability insurance for exposures not covered in a malpractice policy. Give us a call or submit your information online to learn more.