Don’t assume that because an employer pays for your malpractice insurance you needn’t pay attention to insurance coverage. That couldn’t be further from the truth. Medical liability insurance is essential. It must be adequate to cover pediatric malpractice indemnity payments and continuous (no gaps between jobs).
Professional liability insurance in the medical field is commonly referred to as medical liability or malpractice insurance. It protects the physician from having to bear the full cost of a payout for medical liability and defense costs, should a patient or parent file a malpractice suit.
Most physicians’ perception of their threat of malpractice is based on three factors: the risk of a claim, the probability of a claim leading to a payment, and the size of the payment.
- Pediatricians are not sued as frequently as other specialists. Only 3.1% of pediatricians face a malpractice claim in a given year compared to 19.1% of neurosurgeons, the highest specialty.
- One in five pediatric malpractice claims results in some form of indemnity payment (settlement or award).
- What’s more concerning is that the severity of pediatrics claims is high compared to other specialties. Even though neurosurgeons are several times more likely to be sued, their average malpractice payment is $344,000, compared to that for pediatricians, $521,000. Although payments in excess of $1 million are rare (less than 1% of all payments), the specialties most commonly accounting for those payments are obstetrics/gynecology, pathology, anesthesiology, and pediatrics.
For these reasons having adequate and continuous medical liability insurance coverage is essential. Even if employers pay for the medical liability insurance, pediatricians need to understand what is and isn’t covered and what happens after their employment ends (is tail insurance necessary and if so, who pays for it). A single uninsured malpractice claim may be devastating financially.
The AAP Committee on Medical Liability and Risk Management has compiled some graphics on pediatric malpractice trends from the medical literature.
AAP Medical Malpractice. These include:
- Malpractice claims by pediatrician age
- Malpractice claims by patient age
- Proportion of pediatrician’s career spent with an open malpractice claim
- Most common patient conditions in paid out malpractice claims There are 2 main options to choose from when deciding on malpractice coverage claims-made or occurrence-made policies. It is very important to understand the differences.
A key medical liability insurance provision to consider when negotiating with potential employers is who will be responsible for the costs of tail insurance should you decide to leave the practice for any reason.
Don’t Assume that All Legal Obligations End on Retirement
A common myth held by many physicians is that they no longer need to respond to subpoenas, answer complaints filed with the medical board because they have retired. These obligations do not end after you stop practicing. For example, if a retired physician receives a subpoena for medical records, the or she must respond to it. No exception for “retired person” to the rules of discovery in lawsuits exists. Should any of those events transpire, the physicians should consult counsel. Prior to that they should have ascertained how long they should keep medical records after they retire. If the physician arranged for a medical record custodianship arrangement with a third party, it is important to specify in the contract how long the custodian will retain those records and that they will respond should there be a request for medical records. Retired physicians should also consider putting their medical license on “retired” or “inactive” status, or consider letting it lapse altogether. In most states, the medical board doesn’t have jurisdiction over nonlicensees. However, it is vital that a physician have medical malpractice coverage simply because a plaintiff can still sue a retired physician. Verify your medical liability coverage with your malpractice insurer before you retire.