Medical Malpractice Insurance Medical Malpractice Insurance is a necessity for healthcare providers. We tell people that health insurance is a necessity, why? Because it covers them if something unexpected happens, well that reasoning goes for providers also. It helps to cover a situation that isn’t necessarily supposed to happen, but does. Providers are normally well trained, but as we all know the body and medicine can do funny things and what was to be a “routine” surgery or illness has now caused a disfigurement in someone or even possibly a death.
Although the definition of medical malpractice is defined as more than just an “accident” it is defined as an act or omission by a health care provider which deviates from accepted standards of practice in the medical community and which causes injury to the patient. Simply put, medical malpractice is professional negligence that causes an injury. Our society has become so lawsuit happy that through the years frivolous lawsuits have come through the court system and plaintiffs have walked away with an “uncapped” amount of money to “compensate” them for their loss.
With these kinds of things happening through the years the medical malpractice trends have been premiums doubling, deductibles tripling, and insurers are not selling the product anymore. Back in the 1990’s insurers were driven more by the premium amount they could sell more so than by whether the premiums were adequate to pay the losses. The ideal world would be for the investment income would cover any deficiencies that exist in the underwriting result. As competition increased, underwriting results deteriorated and the fact is if insurance policies are consistently underpriced, the insurer loses money.
Every state has different requirements for healthcare professional’s malpractice insurance. An example might be Florida does not require physicians to carry malpractice insurance coverage. Even though the state may not require malpractice coverage the individual organizations normally do require that all physicians have malpractice insurance in order to have privileges at their facility(ies). My organization Florida Hospital supplies Medical Malpractice Insurance for all physicians that are employees at different levels depending on their discipline.
Our Interventional Cardiologist has to have a minimum $400,000/$500,000, but yet our Family Practice Physician needs a minimum of $250,000/$350,000. These minimums are based on their risk/exposure for their particular discipline. Several factors go in to calculating what malpractice insurance coverage is going to cost. The level of treatment that is given to a patient is probably the first and foremost consideration when calculating premium coverage. A surgeon is going to have a higher premium than a family practitioner. Another strong factor is the experience level of the provider.
A provider who has been practicing for many years is going to have better premiums than someone who is fresh out of residency training and school. I also understand that Florida has one of the highest set premiums for Obstetrics and Gynecology in the country. When looking for malpractice insurance keep in mind there are 2 forms of coverage. There is “occurrence” coverage and “claims-made” coverage. Occurrence coverage protects you against any claim of negligence for the time period that the premiums were paid; regardless of the when the claim was actually filed with the insurer.