Doctors are humans too and are not immune to committing mistakes. But let’s face it, in the field of medicine, one mistake could cost a life. And with the high cost of healthcare, much is expected from our medical professionals.
Statistics show that there are more than 250,000 deaths each year due to medical errors. We have also heard of cases of injuries, brain damage, and hemorrhage after a medical procedure. Aggrieved parties can decide to take legal actions against the medical professionals who committed medical malpractice. These legal settlements can be very expensive. That is why it is best for medical professionals to have a malpractice insurance.
Medical malpractice insurance is a professional liability insurance specifically covering the healthcare professionals. Most states have laws requiring doctors to have medical malpractice insurance before they can treat patients.
But doctors are not the only health care professionals that are required to get medical malpractice insurance. This is also applicable to nurses, dentists, orthodontists, naturopathic doctors, and chiropractors. Hospitals and medical facilities can also avail of this insurance. The malpractice insurance protects medical professionals when there are complaints and legal actions against them. This also covers expenses for defense lawyers and settlement costs.
Average Cost of Malpractice Insurance
It is tough to come up with a single figure average for the cost of medical malpractice insurance across all specialties in different states. When you inquire about the prices, insurance providers will give you a customized quotation based on your specialty, location, among other factors.
However, it may be good news for medical professionals to know that medical malpractice insurance cost has remained steady for the past years. According to the 2017 Medical Liability Monitor Annual Rate Survey, the medical insurance rates for the majority of the providers remained the same between 2016 and 2017.
As stated earlier, the average cost varies depending on the specialization and state of practice. For example, the Doctors Company reported that the average medical malpractice insurance cost in 2016 for obstetricians and gynecologists was between $30,000 and $60,000. These doctors are practicing in a field which is considered one of the highest risk specialties that are why their medical malpractice insurance cost is significantly higher compared to other doctors.
The same report showed that the malpractice insurance average cost for internists ranged between $10,000 and $14,000, which was way below what other doctors were paying for their premiums. This is because internal medicine is considered a low-risk specialty among insurance providers.
Arthur J. Gallagher & Co., also known as Gallagher Healthcare which provides insurance solutions to medical practitioners, showed that the average medical malpractice insurance cost in Texas is significantly lower than that of other states.
The top three specialties with the highest malpractice insurance average cost in this state are: Obstetrics and Gynecology Major Surgery with an annual premium of $28,171, General Surgery with $22,099, and Orthopedic Surgery No Spine with $18,783 premium per annum.
Meanwhile, in California, the average per year for these specialties would be $42,670 for Obstetrics and Gynecology Major Surgery, $27,700 for General Surgery, and $25,105 for Orthopedic Surgery No Spine.
As we can see, there is a wide range in the prices of medical insurance according to their specialization and location. That is why it is advisable for medical professionals to do a thorough research about the cost of malpractice insurance in their respective fields and states where they are practicing.
What are Included
Medical malpractice insurance offers liability coverage according to the limits set in the policy. There are policies that cover your legal defense in the event that there is a malpractice case against you along with the court fees and cost of the settlement. But take note that there is a limit to the amount of their coverage. You have to verify the policy inclusions with your insurance provider. Negotiate for terms that would suit the risks you are facing in your field of specialty.
If you want to avail of more benefits and further coverage, you have to upgrade your policy and pay for a higher malpractice insurance premium. Example of additional coverage includes medical costs and penalties. Otherwise, you have to pay for costs and damages that go beyond the limits of your insurance policy. Check also if your insurance plan involves paying deductibles before you can avail of the benefits.
Take note that there are two types of malpractice insurance policies: claims made and occurrence made.
Claims made policies offer protection for medical professionals as long as the policy is updated. The accident or malpractice must be within the policy period as well as the filing of the lawsuit for the insurance company to cover the costs.
Occurrence made policies offer protection for any accident or malpractice that happened during the policy period even if the lawsuit was filed after the policy has expired. For example, the insurance coverage offered by the Medical Liability Mutual Insurance Company is on claims made basis. They suggest that it is better to add a tail coverage to be ensured of an extended protection even after the termination of the coverage of the insurance plan.
Shopping for Malpractice Insurance
Physician Insurers Association of America or PIAA has a comprehensive list of providers that offer medical malpractice insurance. You can go to the website of each provider that appeals to you so that you can know more about their company. You can also ask for a quotation to find a policy that suits your needs.
Each state also has a listing of accredited insurance providers in their area. You can also check if there have been complaints about a specific company. Of course, you can always ask your colleagues about their insurance providers so that you can get first-hand information on their policies and procedures.
Factors Affecting Cost of Malpractice Insurance
As we keep mentioning in this article, the specialty and location of the medical professional are two driving factors. Specialties with a historical record of having higher claims have higher annual premiums.
There are specialties that are considered high risk because of the severity of the diseases or injuries and procedures done are more sensitive and complicated in nature. Some states impose different extent of liability for medical professionals and healthcare facilities. When the limit of liability in a particular state is low, then the annual premium of the medical malpractice insurance is also low.
Another factor affecting the cost of malpractice insurance is the personal claims history of the medical practitioner. If he or she has a record of malpractice, then that increases his or her risk profile and will be charged with a higher premium.
The policy coverage will definitely affect the rate of the insurance. If you avail of an inclusive policy and upgrade the limits and coverage of your plan, then the price of your malpractice insurance will be higher.
On the bright side, insurance providers also offer discounts to their members who are affiliates of medical associations, have completed the Risk Management Program, those who only work part-time, and have maintained clean professional records for the past years.
Insurance providers offer different payment options. Payments can be made in full and they can offer you a discount when you do that. For more affordable payment options, you can also choose to pay your premium rate on a quarterly basis.
Any medical professional who is serious about his or her practice should get a medical malpractice insurance. It is not just because it is required in the state where he or she is working, but because it is a critical protection for their profession that would set his or her mind at ease about any unforeseen and unplanned incidents. You never know what could happen when you deal with the complexities of human health and well-being.