You write the renewal premium check every year, but did you know that not having your medical malpractice (medmal) policy reviewed could be costing you even more money?
In general, health care costs are increasing, insurance reimbursements are declining and malpractice premiums are constantly changing. This all spells opportunity for health care related businesses to have their policies reviewed by a qualified broker, says Chris Ferraris, a medical malpractice expert at Momentous Insurance.
Another benefit of the policy review is to make sure your business is protected.
“Without proper insurance, you may as well be prepared to reach into your own pocket to pay for legal costs should a lawsuit be brought against you,” he says. “That can drain your business entirely. And that’s just the economic damages.”
Smart Business spoke with Ferraris about reasons to review your policy annually.
How does a review keep you from paying too much?
Medmal insurance carriers often change premium rates. To remain competitive and to increase their market share, carriers may lower rates and/or loosen underwriting guidelines. When a broker who specializes in medical malpractice reviews your policy, he or she knows whether better rates are available and shop the marketplace on your behalf. This analysis drastically reduces the risk of overpaying for the coverage you need.
Why might you be lacking the necessary coverage?
Medical malpractice insurance companies also change policy forms, which can restrict or enhance coverage. Without an advocate it can be difficult to determine whether your policy includes every coverage enhancement for which it is eligible.
Sometimes carriers exclude certain procedures or treatments because of changes in state or federal laws, or at their own discretion. If a claim arose as a result of a procedure excluded from coverage, the carrier could deny the claim. Furthermore, you might be lacking the necessary coverage if your policy was not written properly from the start.
What if your practice profile changed since you applied?
It’s not just carriers that make changes, health care practices are constantly evolving and their insurance needs are evolving as well. Whether getting a new piece of equipment, offering new procedures or adding locations, any change can affect coverage.
It’s the responsibility of the policyholder to notify the carrier of any changes in business practices. If an undisclosed item results in a claim, it could be denied.
How do staff changes affect your insurance?
Changes to the staff, including medical directors, are the reporting responsibility of the policyholder. If a claim is filed as a result of an uncovered employee, independent contractor, volunteer or other health care professional, there could be no coverage.
How does a review improve your chances of getting claims paid?
Reviewing your coverage needs regularly with your broker helps avoid potential complications, and ultimately improves your chances of getting a claim paid. Also, having an advocate in your corner means you have someone looking out for your best interests, not the interests of the insurance company.
In summary, the five key reasons to review your policy on an annual basis are:
1. You could be paying too much.
2. You could be lacking needed coverage.
3. Your practice profile could’ve changed since you applied.
4. Your staff could’ve changed.
5. To improve your chances of getting a claim paid.
There’s no time like the present to request an independent review. If you haven’t had a review in over a year, we urge you to take action and contact your broker today. Having proper coverage gives you greater peace of mind and allows you to focus on your patients and business — where your time and energy should be dedicated.
Chris Ferraris is a health care risk management consultant at Momentous Insurance Brokerage, Inc. Reach him at (818) 574-0424 or [email protected].
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