Physicians and surgeons in Florida often hesitate to report potential claims to their medical malpractice insurance carrier because they are afraid their insurance will be cancelled or they will lose their claims free credits. Although this issue is certainly subjective, i.e. what is worth reporting to the carrier, we strongly encourage our clients to report any incident that may lead to a claim. A quality medical malpractice insurance policy is written with an “incident trigger”, meaning that the company will defend any incidents reported during the policy term. This applies even if the physician or surgeon has switched to another medical malpractice insurer, has gone “bare”, or is deceased.
Most medical malpractice insurers require the insured doctor report incidents that are reasonably expected to lead to claims. The definition of what is reasonable is usually rather vague. In addition, the insurer will require that the insured not engage in conduct that prejudices the insurance company’s ability to defend a claim. Failure to give timely notice could be seen as prejudicing the claim.
The question of when an outcome is likely to lead to a claim is very subjective. Generally, if a patient makes statements that lead the physician or surgeon to believe a claim will result should be reported. If a patient requests records following a bad outcome, this could raise a red flag. Clearly, if the physician or surgeon receives a request for records from a plaintiff’s attorney in connection with a questionable outcome, there is a duty to report the incident to the medical malpractice carrier. Healthcare providers need to exercise good judgment in evaluating the decision to report or not report bad outcomes.
There is, of course, a downside to reporting all negative outcomes. Even if a physician or surgeon never has an actual claim, reporting too many negative incidents could jeopardize his ability to secure medical malpractice insurance in the standard market from a quality company. Sometimes a doctor may be advised to “dump” every bad outcome to the incident trigger medical malpractice insurance company he is leaving. While this “dumping” practice may seem like a good idea at the time, it could very well come back to bite the doctor in the future. Most applications for new business ask about incidents that have been reported to a prior company.
It is probably best to call our office if you have a question as to whether or not to report an incident to your medical malpractice insurance carrier. We generally believe that, if the incident is serious enough for the doctor to call, it should be reported.
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 firstname.lastname@example.org.