Surgeons, obstetricians and other medical professionals must pay hefty premiums for malpractice insurance policies with annual deductibles attached.
Selecting sufficient limits of liability coverage is of critical importance. These should cover sustainable verdict values for non-economic and economic damages.
Most medical facilities require that physicians hold specific limits of occurrence coverage in order to be granted hospital privileges, and may also mandate tail coverage that protects against events which happen after their policy lapses.
How Much Malpractice Insurance Do Doctors Need?
Physicians should purchase malpractice insurance to protect themselves financially against an expensive lawsuit. Medical malpractice premiums differ depending on state and specialty, with surgeons and OB/GYNs usually paying higher premiums. On average, physicians spend roughly 3.2% of their incomes for malpractice premiums; nonetheless it’s a small price to pay for this extra layer of protection that malpractice insurance provides.
Since malpractice lawsuits and their payouts remain high, insurance rates for doctors have steadily increased, leading to some physicians leaving states such as New York where malpractice insurance premiums are especially expensive, or switching to RRGs that provide lower premiums.
Doctors typically purchase their own malpractice insurance policies, though coverage may also be provided through their employer or as part of an employee benefits package. Many hospitals require that physicians with admitting privileges possess malpractice coverage for admittance; in addition, certain federal agencies such as Veterans Affairs self-insure against liability claims so some medical professionals working there don’t necessarily need their own malpractice coverage policy.
Physicians purchasing malpractice insurance should review their policy carefully to make sure it fits their specific needs. Some policies may exclude volunteer work and moonlighting activities; it’s crucial that physicians know exactly what coverage their policy provides – be it an occurrence or claims-made policy – along with any limitations or whether they must purchase tail insurance to file claims after its expiration.
Typically, physicians should carry coverage of at least $1 million per claim and $4 million aggregate; however, many opt to purchase higher limits of malpractice insurance which may prove beneficial to physicians with unique or dangerous practices or specialties. They should also determine whether their policy includes general liability protection – typically included as standard coverage on auto and homeowners policies.
How Much Malpractice Insurance Do Doctors Pay?
Based on their specialty, doctors typically pay between $4k to $12k annually for malpractice insurance premiums. Surgeons tend to pay the most while OB/GYNs tend to spend the most. Cost of malpractice varies greatly by state as well, with practice locations having the biggest influence. Neurosurgeons in Nassau and Suffolk counties tend to incur significantly higher premiums than surgeons elsewhere in New York State.
As noted above, the amount paid out on claims can also be an integral component. Defense attorneys and expert witnesses can rack up significant costs that would require doctors without malpractice insurance to cover directly. Most experts advise having at least a $1 Million per case limit and $3 Million total coverage limit policy; however physicians with less risk may opt for something smaller with lesser amounts.
Additionally, it’s also essential to carefully consider which type of malpractice policy will be purchased. Occurrence policies cover events occurring while the doctor has coverage, while claims-made policies only cover events reported during that timeframe. It may also be possible to purchase “tail coverage”, which extends coverage after their original policy has expired.
Recent turmoil within the insurance industry can be seen in its prices for malpractice insurance policies. While rates haven’t seen as dramatic an increase as in previous years, they still remain very high; yet malpractice coverage still offers many doctors valuable protection of their financial assets and liabilities. Even in states where malpractice coverage isn’t legally mandated by law, many physicians carry it regardless because their hospitals require it or to avoid expensive lawsuits; regardless of this need or not having malpractice coverage is something every doctor should evaluate carefully in his or her decision making process.
How Much Malpractice Insurance Do Doctors Get?
Average physician salaries in the US contribute just over three percent of their salaries toward malpractice insurance premiums – an amount which may seem substantial at first, but pays dividends when considering peace-of-mind that comes from having it. Malpractice rates differ depending on a variety of factors including specialty and where physicians practice; neurosurgeons and emergency room doctors in particular often pay much higher premiums. Furthermore, state insurance environments differ greatly; therefore the costs can differ widely across different locations.
As a general guideline, physicians should strive to secure enough malpractice insurance to cover defense costs, settlements, and any final judgment costs. Typically this would mean having at least $1M/$3M of coverage (where 1 is per incident and 3 total policy limits).
Recently, medical malpractice premiums have decreased or remained flat across most states as more states enact tort reform laws with caps on damages awarded to patients and technology advances make physicians less likely to make errors than they used to.
Even with lower rates, all physicians should remain cognizant of their malpractice risks and be clear on the coverage available to them. This is particularly important if joining or starting their own practice; often groups that already exist have chosen the carrier and negotiated policies; making it hard for individual physicians to know exactly what they’re paying for.
Physicians should also be aware that some malpractice policies include allocated loss adjustment expense (ALAE) within their primary limit, which are expenses incurred during litigation and can be substantial. As this can reduce availability of primary limits, it’s wise for doctors to review their policies frequently and ask any questions they have about coverage. Those looking for added protection might consider purchasing an umbrella policy, asset protection trust or LLC for extra peace of mind.
How Much Malpractice Insurance Do Doctors Have?
Medical Malpractice Insurance protects physicians against costly lawsuits brought on by patient injury or death claims that can cost thousands to defend, covering bodily injury claims, property damage claims and legal defense expenses. While its cost varies based on specialty and state, its expense should never outweigh its protection value. Medical Malpractice covers claims for bodily injury, property damage claims as well as legal defense expenses and is well worth protecting themselves with.
Doctors practicing high-risk specialties such as surgery, neurosurgery and OB/GYN typically pay significantly higher costs for their malpractice insurance than doctors in other specialties; costs range anywhere from several thousand dollars up to several millions depending on specialty and location.
Before purchasing malpractice insurance, it’s essential to consider the total amount of any judgment awarded in medical malpractice suits when purchasing coverage. A substantial enough policy limit should also cover potential multiple claims in some states with high awards; otherwise multiple policies with similar or higher limits might be necessary in such instances.
Physicians should also compare policies by considering the cost of tail coverage when comparing policies. While many hospitals provide tail coverage to employed physicians, when changing jobs or retiring they must secure their own policy – typically this costs 200% of an expiring premium for claims-made policies.
Some states have tort reform laws that set caps on how much a jury can award in noneconomic damages such as pain and suffering awards. Although tort reform laws don’t prevent patients from filing malpractice suits, they help decrease frivolous claims.
At all levels of medicine practice, doctors need to have comprehensive malpractice insurance policies. While malpractice lawsuits are relatively rare, any claim can be financially devastating for a physician and the costs of defending against one can quickly mount up – therefore it is in their best interests to plan ahead and purchase comprehensive coverage policies with adequate limits.
