Malpractice Insurance Considerations
Irrespective of whether they are independent contractors or employees, physicians remain liable for any torts they personally commit while delivering medical care. Physicians must ensure that they have adequate medical malpractice insurance and that they control the policy of insurance. This is no different from the responsibilities of a physician with medical staff privileges at a hospital. Physicians recognize that they have different interests from those of the hospital. In some cases, these interests are adverse, in that the physician may claim that it was the hospital’s personnel who were negligent, or the hospital may claim that it was the physician’s negligence that caused the injury.
As with hospitals, physicians must recognize that their interests and those of the managed care plan often will be adverse. If the physician has negotiated for an MCO to provide medical malpractice coverage, then the physician should ensure that he or she is the primary insured on the policy. This gives the physician enhanced control regarding whether or not a claim is defended or settled, and if settled, what the terms will be. Ideally, coverage will be provided in the manner to which the physician is accustomed, like independent private insurance, that is just paid for by the plan. More likely, however, physicians will be insured through a self-insurance trust funded by the plan. Again, referring to the experience with hospitals, some of these plans are less than scrupulous about protecting the interests of the physician. Hospitals have been known to treat the self-insurance fund like a piggybank from which it may defend the physician as a favor. Although this may violate conditions applicable to maintaining a self- insurance fund, there is little oversight of these funds, and less recourse for a physician caught in a conflict. A physician dealing with one of these funds, or any other insurer that may be captive of an adverse party, should hire his or her own counsel to monitor the defense attorney’s work.