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Monthly Archives: July 2013

I am a physician and am planning to leave my group. What should I do regarding my medical malpractice insurance?


It is important to know the medical malpractice insurance (also called medical professional liability insurance) implications of leaving a group practice. Many physicians have found out the hard way about sticky issues related to their coverage.
The Employment Contract should spell out issues related to leaving the group and your insurance ramifications. One of the biggest issues is whether or not you need to purchase a tail (extended reporting endorsement). Hopefully, you have made sure the responsibility for tail coverage if you leave the group has been spelled out in your employment contract. Even if the group pays for your medical malpractice insurance, often the issue of whether you need to purchase a tail is unclear. The tail policy can be expensive, so it is important to know who pays for it.

If you are not required to purchase a tail, you may often take your policy with you. Then the alternative to purchasing tail coverage is called “nose coverage”, the insurance term for prior acts coverage. So, when you move from one carrier to another, you may choose between tail coverage with the expiring carrier or retroactive coverage with the new carrier.

If you are changing carriers, you might want to ask your new carrier for a quote for retroactive coverage and compare it with the cost of purchasing tail coverage from your old carrier. It either case, it is important to make sure that the retroactive date covers the period of your previous policy.

If you leave a group that agreed to pay for your tail policy, it is important to double check with the carrier to verify that it has been paid.

In addition, be sure your coverage limits are the same as those of your old policy. Double check the aggregate limits, which is the amount the policy will pay for all claims combined for a stated period. An annual policy has aggregate limits for one year, but sometimes the aggregate limits for a tail policy apply to all the years the policy was in effect.

Barbara Gracey Backer


Barbara Gracey Backer is the Vice-President of Gracey-Backer, Inc., an Insurance Agency in Delray Beach, Florida specializing in All Lines of Professional and Personal Insurance. She may be contacted at 800-272-6055 X118 or at barbara@gbifl.com.

Employment Agreements for Oral Surgeons and Dentists


Graduation from residency or dental school can be very overwhelming: you cannot wait to get started with future patients, but first you have a multitude of decisions to make. Will you join a small practice or a large regional practice? Will you start your own practice? Will you go continue your schooling in a doctoral or specialty program?

If you decide to join an existing oral surgery or dental practice, it is important to review your Employment Agreement carefully and thoroughly. Employment agreements vary from practice to practice, and even among associates within a practice. Employment Agreements are legally binding contracts so you should have it reviewed by an experienced labor attorney. While there is no standard Employment Agreement, State and Federal laws govern many aspects of employment.

Some common terms that you can expect to find in an Employment Agreement are:

  • Term of Employment (effective date of hire, length of service, start and end dates, address of the office, how long before you can be a regular employee or partner versus an independent contractor)
  • Services to be performed (full or part time, scope of practice, expectations, hours/days to be worked, moonlighting potential)
  • Compensation (base pay, profit sharing, expectations for production, reimbursement for continuing education and professional dues, bonus—guaranteed or discretionary)
  • Benefits (health care, car allowance, vacation time, holidays, sick days, life insurance, disability insurance)
  • Professional Liability Insurance or Dental Malpractice Insurance (who pays the premium, policy limits, duty to purchase tail coverage, duty to maintain coverage)
  • Record keeping duties (confidentiality, who owns and maintains records)
  • Covenant Not to Compete or Restrictive Covenants (if recognized by state law, terms and conditions that restrict a departing employee for a set term and geographic region)
  • Non-disclosure (prohibits sharing of private patient information, business operations of employer, referral sources, 3rd party payer information)
  • Termination of Employment (notice requirements, what constitutes cause for termination (if required), at-will employment where no cause is required, grounds for automatic termination)

While this is certainly not an exhaustive list of what to look out for in an employment agreement, it should help you get started. For any questions about employment agreements and for clarification of certain terms in your employment agreement, you should contact your employer and/or a qualified attorney in your area.

John Gracey Backer, CPA


John Gracey Backer, CPA, is the Treasurer of Gracey-Backer, Inc., an Insurance Agency in Delray Beach, Florida specializing in All Lines of Malpractice, Professional and Personal Insurance for the Healthcare Provider. He can be contacted at 800-272-6055 ext 128, or at john@gbifl.com.

I am a physician planning to join a group practice. What do I have to do regarding medical malpractice insurance?


This might seem like an easy question. If you are employed by a group, at a minimum you should know the carrier and understand what happens if you leave the group. If you are a shareholder or owner, you need to choose a quality carrier, choose coverage options, and decide how to allocate the premium among the group. If you are employed by an institution or hospital that is self-insured, you should know what to do if a claim is filed against you.

The following are important considerations to discuss before you join the group:

  • Who provides the medical malpractice insurance coverage—the practice or you? Most likely it is the practice. Do you need to purchase retroactive coverage with the new company or tail coverage with the old?
  • What happens if you are sued? You should be aware of the local attorneys retained to handle your case. Check to see if the company has the right to settle without your consent or if there is a “hammer clause”. Does the policy cover defense costs in addition to the limits of liability?
  • What happens when you leave the group? Are you required to buy a tail? Who pays for it?
  • What limits of liability does the group have? (You should have the same limits as everyone else and the prevailing limits based on your geographical area and your specialty.) Is it a claims-made or occurrence policy? (Most likely, it is a claims-made policy.)
  • What company insures the group? In addition to premium considerations, you should also consider the company’s financial health, claims handling, and client service. It is a good practice to talk with a physician who has been involved with a claim with the carrier. Are risk management programs available to reduce the likelihood of a claim? What is the A.M. Best rating, which gives a picture of the solvency of the insurer?
  • Be sure your insurance covers your full scope of clinical activities. If you are practicing part-time, (usually less than 20 hours a week), be sure you are receiving credit for it.
  • If you are a practice owner or shareholder in the practice, be sure the coverage applies to your PA and your employees.
  • If you are a small practice, you may want locum tenens coverage to be included. Many policies include locum tenens for a specific period of time, at no additional premium.
  • If your insurance is with a trust or a captive, check to be sure it is not assessable, meaning the insuring entity has the right to assess you if losses are excessive.

While this is certainly not an exhaustive list of what to look out for in an employment agreement, it should help you get started. For any questions about employment agreements and for clarification of certain terms in your employment agreement, you should contact your employer and/or a qualified attorney in your area.

Barbara Gracey Backer


Barbara Gracey Backer is the Vice-President of Gracey-Backer, Inc., an Insurance Agency in Delray Beach, Florida specializing in All Lines of Professional and Personal Insurance. She may be contacted at 800-272-6055 X118 or at barbara@gbifl.com.

Choosing the Right Dental Professional Liability Insurance Carrier


Choosing the right dental professional liability carrier takes careful consideration. But in the end it all comes down to their REP – Reliability, Expertise, and Premium.

Reliability

  • How long has the carrier been in business?
  • How long have they been writing Dental Professional Liability?
  • What is their A.M. Best rating? A.M. Best is a credit rating agency for the insurance industry. Knowledge of this rating will help you assess the financial strength of the carrier. For more information on A.M. Best visit their website at www.ambest.com.
  • Does the carrier write in only your state or are they able to write in other states, and if so is your coverage portable? You may not be planning to relocate now, but if you should move out of state, it would be nice to know if you have the option to continue your coverage with the same carrier in another state.

Expertise

  • What has been their experience defending dentists’? Since dentists’ claims are unique to dentists’, this is an important consideration.
  • How often do they settle a claim versus litigation?
  • What if any input will you have regarding a settlement?
  • What kind of advice, risk management techniques, and consent forms are provided by the carrier to help you prevent a claim?

Premium

  • Have there been rate increases in the past five years, and If so why?
  • What was the overall rate increase for a dentist based on your characteristics? Assessing the carrier’s past rates will often provide insight into their future rates.

When purchasing a Dental Professional Liability insurance policy (also known as dental malpractice insurance), you are essentially purchasing a promise. The carrier promises to defend and pay damages on your behalf for a future professional liability claim made against you. Knowing the REP of the carrier is essential in helping you determine a carrier capable of keeping their promise.

Regina Walker


Regina Walker is an Agent at Gracey-Backer, Inc., an Insurance Agency in Delray Beach, Florida specializing in All Lines of Professional and Personal Insurance for the Healthcare Provider. Regina is an Account Executive in the Dental/Oral Surgery Department. She can be contacted at 800-272-6055 ext 111, or at regina@gbifl.com.

What is Employment Practices Liability Insurance and Why do I Need It?


If you have ever faced a difficult situation with an employee, you know how quickly it can turn into a lawsuit. Where employees formerly complained around the water fountain, now they hire labor attorneys to go after you and your medical practice. Whether the issue involves hiring, firing, pay, benefits, contract interpretation, alleged harassment, or just a bad feeling, the effect on your practice can be devastating if the employee seeks legal action. Employment-related lawsuits are the plaintiff attorney’s new hot-button, as tort reform has reduced the frequency of medical malpractice-related claims.

Every physician and surgeon, whether in a large or small office, should consider purchasing Employment Practices Liability Insurance (EPLI). Without this vital protection, you have an exposure that leaves you vulnerable.

EPLI covers suits against you by employees, vendors, independent contractors, or patients for actual or alleged acts such as:

  • Wrongful Termination
  • Discrimination
  • Sexual or Workplace Harassment
  • Breach of Employment Agreement
  • Wrongful hiring
  • Violation of Family Medical Leave Act
  • Defamation of Character
  • Failure to promote, etc.

Premiums are based on the number of employees in your practice. Legal expenses are covered outside the limit of liability. Third party suits against you, by vendors, independent contractors, sales representatives, patients, etc. are covered.

Deborah Vashon, CPCU


Deborah Vashon, CPCU leads the Commercial Lines Department of Gracey-Backer, Inc., an Insurance Agency in Delray Beach, Florida specializing in All Lines of Professional and Personal Insurance for the Healthcare Provider. She may be contacted at 800-272-6055, ext 119, or at debbie@gbifl.com.

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