10 Things You Always Wanted to Know about Malpractice Insurance but Were Afraid to Ask
Whether you're working in permanent practice or as a locum tenens physician, malpractice insurance coverage is a standard concern for all doctors. But it's a particularly frequent question among our locum tenens physicians who work with Staff Care: Namely, how does locum tenens malpractice insurance work, and what should physicians know about their coverage options?
Of course, a big advantage of working locum tenens assignments with staffing agencies like Staff Care is that your malpractice insurance is provided for the duration and legacy of your assignment. All the same, physicians considering working locum tenens should be clear on some basic concepts regarding malpractice insurance (as should hospitals, medical groups, and other users of locum tenens doctors, for that matter).
The following 10 terms and concepts not only provide the basic information for understanding locum malpractice insurance, but they also serve as a useful primer for malpractice coverage in general — for residents and fellows contemplating their first physician job, for example, or for a locums doctor switching to full-time employment who's faced with options with which he or she may not be readily familiar.
Locum Malpractice Insurance: 10 Key Concepts
1. Limits of Liability
How much coverage do malpractice insurance carriers offer? The standard in locum tenens today is $1 million per incident and $3 million aggregate for the term of the policy, which generally is for one year. Most clients of staffing agencies and a few state medical boards request that locum tenens agencies provide this $1 million per incident/$3 aggregate standard. Locum tenens physicians and staffing agency clients should be sure to inquire about limits of liability before working with an agency.
2. Financial Strength/Rating of Carrier
Locum tenens physicians and those who use them should inquire into the financial strength and rating of the staffing agency’s insurance carrier. Insurance carrier ratings are determined by A.M. Best and can be researched at www.ambest.com or on the website of the carrier. These ratings can be tied to the economy and general investment trends. At the time this article was written, many insurance companies had encountered financial challenges and their ratings had fluctuated.
3. Occurrence and Claims Made
The two main types of malpractice insurance are occurrence and claims made. Occurrence insurance covers the locum tenens physician regardless of when the claim is reported. With claims-made coverage, the incident must be reported while the policy is in force (again, this is typically for a one-year term); also, the incident must have occurred during the period of time covered by the policy.
4. Prior Acts or Tail Coverage
Locum tenens physicians working with claims-made policies should make sure that the staffing agency provides prior acts or tail coverage to help ensure protection after the policy period is over. It's important to evaluate the financial strength, longevity, and track record of the staffing agency to ensure it has the capacity to purchase prior acts or tail coverage. If the staffing agency goes out of business, then coverage may no longer be in effect, unless the staffing company has purchased unlimited tail coverage. However, if the staffing agency’s insurance carrier goes out of business, the agency may seek prior acts or tail coverage elsewhere. Hospitals and other organizations’ malpractice insurance generally only covers their own employees and their acts but not locum tenens physicians.
5. Agency Finances
Facilities and practices working with locum tenens agencies also are well served to evaluate the financial strength and market position of the agencies with which they work. If neither the locum tenens physician nor the staffing agency has malpractice insurance, liability will typically fall on the hospital or medical group.
6. In-State Coverage
Locum tenens physicians should ensure that the malpractice insurance carrier provides coverage in the state where the assignment is located. This may seem obvious, but it isn't always the case!
7. Physician Advocates
If a claim is filed, the staffing agency should act as a liaison between the malpractice insurance carrier and the locum tenens physician, facilitating communication and acting as the physician’s advocate.
8. The Federal Tort Claims Act (FTCA)
The FTCA provides a limited waiver of the federal government's sovereign immunity when its employees are negligent within the scope of their employment, and generally applies to physicians working in military or Indian health facilities. Learn more about the Federal Tort Claims Act and get access to resources here.
9. General Liability Insurance Coverage
This insurance covers the legal liability for claims of bodily injury and property damage arising out of business operations that would not be covered by the malpractice insurance policy. Examples include libel, slander, and physical damage to a hospital or hotel.
10. Workers’ Compensation
Since locum tenens physicians are independent contractors, they are not entitled to workers’ compensation coverage from the staffing company or from facility where they are working, in most states. (There are a few exceptions, such as Idaho and Wisconsin.)
As many of the above points illustrate, it's certainly in a physician's best interest to partner with a locum tenens staffing provider that's trustworthy and established. Staff Care offers a decades-spanning track record of locums industry expertise and is a company of AMN Healthcare, the nation's healthcare's leader and innovator in workforce solutions and staffing services. We offer high-quality malpractice coverage to all our locum physicians, who can rest easy knowing we'll be there long after your locums assignment has concluded.
If you have any questions or concerns about locum tenens malpractice coverage, we encourage you to reach out to your Staff Care recruiter or contact us here for more information.