Ask Sawal

Discussion Forum
Notification Icon1
Write Answer Icon
Add Question Icon

Who pays the highest malpractice insurance?

4 Answer(s) Available
Answer # 1 #

In this article, we’re going to talk about the 4 different individuals and/or entities that can be responsible for paying for malpractice insurance – along with the advantages and disadvantages of each. Armed with this information, you’ll be better equipped to negotiate terms with potential employers and be educated on the potential risks that you’ll be faced with as you decide which option is right for you.

Alright, let’s jump in…

There are essentially 4 individuals and/or entities that can pay for malpractice insurance. And it all comes down to the type of practice that you’re involved in.

First, let’s talk about you paying for malpractice insurance yourself. If you’re a solo practitioner, you will most likely be responsible for paying for your own malpractice coverage. This means that it’s up to you to shop around, compare quotes and coverage options, and then select the insurance that you want.

Obviously, you can use an agent to help you with this, but at the end of the day, it’s you’re decision which company you select and YOU are in charge of paying the premium.

This is the most expensive option of the 4 that we’ll talk about today, but it’s also the option that gives you the most control.

When you’re responsible for your own malpractice coverage, you’re able to be more selective when choosing a carrier. You can pick the company you want, the type of coverage you want, and you can get a policy that covers you anywhere you want to work.

Until you’ve been in a situation where your malpractice insurance was provided for you (and you essentially had no choice in the coverage provided for you), you probably won’t fully appreciate this issue. But once you’ve been handcuffed into a policy that limits you in your ability to provide consent on settling a claim or dictates the type of insurance that you have to carry, you’ll realize how much more control you have when YOU’RE the one calling the shots with your malpractice insurance.

So, the pros on this option are: Paying for you own coverage gives you Maximum Control. But the cons are: It’s also the most costly to you (since you’re footing the bill yourself).

Let’s move on to the 2nd way to pay for malpractice premiums, and that is for your employer to pay it. If you’re an employee of a hospital, health system, or even a large independent medical group – chances are, your malpractice insurance will be paid for by that employer.

Many hospitals are self-insured, which means they provide and pay for their own malpractice claims. If they’re not self-insured, they likely have network-wide malpractice coverage that every employee must participate in. This means that you have no control over the type of insurance you have, the amount of coverage you have, and you are likely limited in your protection.

Most employed physicians’ malpractice policies are not written on a broad form; they are limited scope and duty policies. This means that your policy only covers you for claims related to the work that you do for your employer. If the incident that led to a complaint falls outside the scope of your job description or falls within a policy exclusion, you may not have coverage.

If you’re only working for this employer, then it’s generally not an issue for you – but if you want to do any outside work, you must secure your own separate malpractice coverage.

The pro’s of this option are FIRST, that your premium is paid FOR you and that you don’t have the hassle of finding your own coverage. But the con’s are that you have no say in the coverage that you have.

And while it might seem convenient for your insurance to be taken care of by your employer, there may be limitations in your malpractice policy that you are not aware of. We recorded a full episode on the 3 biggest areas of risk for employed physicians – so if you haven’t listened to that episode yet, you can check it out HERE.

Ok, so we’ve talked about YOU paying for your own malpractice insurance, your EMPLOYER paying for your malpractice insurance, so now let’s look at option #3 which is when a 3rd party or contracted entity pays for your malpractice insurance.

This option is a bit of a mix of the previous 2 combined. When a healthcare provider is working as an independent contractor, 1099, PRN, or even locums provider, most of the time they are responsible for securing their own malpractice insurance. HOWEVER, many times the contracted entity will be willing to pay for your insurance or contribute a stipend or give you an allowance towards your premium.

This option is really the best of both worlds. It allows you to get the malpractice insurance that you want – the carrier that you want, the type of policy that you want, the limits you want, with broad coverage – but someone else is helping you pay for it.

It may not be possible for the contracted entity to cover the total cost of your malpractice insurance, but even covering a portion of it for you puts you in an excellent position.

Keep in mind with this option that it will be up to you to pay for and manage the coverage. And you will likely have to comply with some set parameters from the contracted entity. For example, they may require that you only buy coverage from an A-rated insurance company. Or they may require you to carry a certain level of coverage (for example, $1M/$3M limits).

Sometimes we even see entities asking to be listed as the certificate holder or they may ask for some vicarious liability coverage under your policy.

Work with your malpractice insurance agent to ensure that you’re doing your part to meet the requirements of the contracted entity, without sacrificing your coverage.

The pro’s of this option are that you get to control your own coverage (for the most part) and you can often offset the cost by having your contracted entities pay you a stipend or give an allowance to help you pay for your coverage. The con’s of this option are that you’ll have to ensure that the policy you obtain meets the requirements of the contracted entity, and they may request certain permissions on your policy.

And the 4th way to pay for malpractice insurance premiums is a combination of any of the previous options. In today’s complex healthcare market, we see may doctors carry more than 1 malpractice insurance policy.

You may have a malpractice insurance policy provided for you by your employer AND you may have your own supplemental policy for contracted work that you do on the side. Many carriers offer moonlighting policies or part-time malpractice insurance policies at a discounted rate, so obtaining additional coverage is pretty affordable.

[5]
Edit
Query
Report
Ernest Vanlint
Zoologist
Answer # 2 #

Have you ever wondered what specialties pay the highest amount for malpractice insurance? There can be quite a gap in the premiums paid for different focuses, due largely to the likelihood of that specialist being sued. The most-sued medical specialties tend to have higher insurance costs because they’re more likely to end up in court and need to lean on that insurance.

What factors impact the likelihood to be sued? Studies have shown specialties where past cases have resulted in few payouts may be sued less than others. People are also more likely to sue physicians in fields that have yielded larger payouts. Beyond that, there a are few things that tie these cases together besides the high risk factors in each field.

So, what are the most sued medical specialties? Let’s take a look.

OB-GYNs rank among the most frequent targets of medical malpractice lawsuits. The New England Journal of Medicine notes suits against these doctors are most likely to result in high payouts. Because of this, patients may be more likely to sue. These doctors have perhaps the highest cost of medical malpractice insurance because the two-year statute of limitations is so drawn out — it doesn’t start in many states until the injured party, in this case the baby delivered, turns 18. That means, theoretically, patients can sue up to two decades after the alleged malpractice occurs.

The NEJM found nearly 1 in 5 neurosurgeons have faced a malpractice case, making it the most frequent target of lawsuits. It’s little wonder, then, that insurance companies have raised premiums for malpractice insurance for this group. Plaintiffs also tend to get the highest payouts, costing insurance companies not just litigation fees but also those damages.

When people have plastic surgery, they often have an idealized notion of what they want to look like after. If this goal isn’t reached, they may feel hurt and disappointed. This can result in an inflated rate of plastic surgery malpractice cases, where physicians didn’t necessarily do anything wrong, but patients feel angry or upset about the results. The recent high number of malpractice cases has resulted in a jump in insurance premiums.

Underwriters increase the premium level for insurance in specialty areas deemed risky. Orthopedics includes spinal surgery, which includes a high risk for patients as it’s a sensitive area of the body. The specialty can also include tricky diagnoses. The possibility of an incorrect or delayed diagnosis raises the specter of malpractice, resulting in higher premiums.

The New England Journal of Medicine study found thoracic and cardiovascular surgeons are second-most-likely to face malpractice cases behind neurosurgeons. It can cost more to litigate a malpractice claim against a cardiologist because of the special knowledge required to argue the case. Claims are also more likely to include deaths, adding a heavier risk factor to this specialty.

While malpractice suits are part of practicing medicine, there are steps you can take to mitigate your risk.

[2]
Edit
Query
Report
Carl Tamim
SANDER AND BUFFER
Answer # 3 #
  • $111 million verdict in Minnesota: Thapa v.
  • $97.4 million verdict in Iowa: Kromphardt v.
  • $77 million verdict in Georgia: The Estate of Nicholas Carusillo v.
  • $75 million verdict in Georgia: Buckelew v.
  • $68.8 million verdict in Florida: Crohan v.
[2]
Edit
Query
Report
Mouftah jtbdbhbn Digital
ELECTRIC MOTOR CONTROL ASSEMBLER
Answer # 4 #

Across all specialties, anesthesiologists paid some of the highest malpractice premiums. Nearly one quarter (24%) reported paying between $10,000 to $15,000 annually for malpractice insurance, and 17% said they paid between $15,000 to $20,000.

[2]
Edit
Query
Report
Jeri Ivey
Political Scientist