Doctors face a great deal of pressure when it comes to potential lawsuits. Suits can be damaging to their reputation, and they can take a long time to resolve. There is quite a bit of heartache involved, and a great deal of personal expense – sometimes, more than you’d think. While many doctors pay dearly to cover their practice and themselves with liability insurance, often, that insurance isn’t enough. Plaintiffs can seek damages that eat into doctor’s personal assets – or even those of their spouse.
Medical liability insurance
Doctors who have practiced more than 20 years might remember a time when medical liability insurance was a practical solution that offered all-around adequate coverage for their practice and for any suits they might encounter.
These days, liability costs are high and a web of state-by-state laws and regulations indicate varied coverage and outcomes for any given case.
Writing for the American Academy of Orthopaedic Surgeons, Drs. Howard B. Yeon and James H. Herndon present a case for understanding what kind of insurance medical practitioners need to have and provide some suggestions on how doctors can protect their assets.
The doctors argue that most “off-the-shelf” liability coverage plans are probably not enough to cover each eventuality a doctor faces, and they contend that simply spending more on a policy isn’t doesn’t guarantee full and adequate coverage.
Plaintiffs and their attorneys, the authors contend, look for doctors with deep pockets. Lawyers take cases where defendants carry good insurance policies, but they also look at a physician’s personal assets, particularly assets that are unprotected or under-protected. “A search of state and county records can uncover real estate, corporations, and other assets held in the name of the physician or his or her spouse,” they warn.
Protecting assets beyond traditional insurance
The doctors – who together hold degrees from Harvard Medical School, Harvard Law School, and the Harvard Combined Orthopaedic Residency Program – give some good advice about the need for doctors to protect their personal assets and limit liability. They also urge doctors and practice owners to take the time to understand their current insurance strategy and work with their insurer on an ongoing basis to make sure their coverage is adequate.
It is very important for doctors to explore all coverage and risk management options. When protections offered on the standard insurance market seem too costly, or are unavailable to certain types of doctors or practices, there is also the option to create enterprise risk captives to protect a practice. Doctors should take the advice they so often give out: Consider all options, make the best decision possible, then prepare for the worst while you hope for the best. If we can help you better understand how an enterprise risk captive could work for your practice, please contact us.