Eyeworld

by David Laber EyeWorld Contributing Editor The half-million dollar decision: Picking an insurance provider and plan On average, ophthalmolo- gists spend as much as $500,000 on medical mal- practice insurance, so understanding insurance providers and plan options is critical D uring a 30-year career, the average ophthalmologist can expect to be sued for medical malpractice two or three times, said Robert J. Widi, vice president of mar- keting and sales, Ophthalmology Mutual Insurance Company (OMIC, San Francisco). On average, ophthalmologists pay up to $500,000 or more over the course of their career for malpractice insurance, depending on the amount of coverage chosen and the practice location, so it is definitely one of the largest expenses for an ophthalmic practice, Mr. Widi said. Ophthalmologists with poor claims experience, who must rely on the "non-standard" insurance mar- ket, which caters to higher risk prac- tices, can expect to pay two or three times that amount, he said. They also face a higher risk of not being able to secure insurance during diffi- cult cycles in industry when many of the commercial carriers who offer this type of insurance either suspend or leave the market abruptly. Understand insurance terminology When searching for the best insur- ance provider and the best coverage plan, physicians have several op- tions to consider. Publicly traded insurance com- panies are pressured to make profits for shareholders while physician- owned carriers tend to keep and re- turn profits to their policyholders through dividends, Mr. Widi said. This can add up to tens of thousands of dollars over the course of an oph- thalmologist's career, so a physician should ask potential insurance providers about dividends. "Ophthalmologists sometimes believe they might as well buy the highest level of coverage they can af- ford, but when it comes to insurance this may distinguish them as a big- ger target," Mr. Widi said. "They should prepare for the average, real- istic worst case, but not the outlier, and they should choose adequate but not excessive liability limits." Daniel B. Mills, equity partner, Pretzel & Stouffer, Chartered, Chicago, also warned about exces- sive coverage making an ophthal- mologist a target of a civil suit, and determining how much coverage is appropriate is a debated topic. In Cook County, where he works, Mr. Mills said the average ver- dict awards the claimant $1.5-2 mil- lion. So if a physician is insured for $1 million, is that physician respon- sible for the remaining money? While he has never had a case in which a claimant pursued a physi- cian's personal assets, he said he has heard of a couple of cases in which this happened. Ophthalmologists should re- search the ways they can lower the premium. Carriers often give dis- counts for risk management activi- ties, loss experience, group or network associations, and practice characteristics such as hours per week, types of procedures per- formed, and length of time in prac- tice, Mr. Mills said. An $800 tax-free payment is enticing, so a credit for an hour of risk management instruc- tion from the malpractice carrier that will help protect their practice and get paid for it is usually a very good use of ophthalmologists' time. Physicians need to be aware if their medical malpractice insurance agreement includes a consent clause, Mr. Mills said, which will dictate if the insurance company or the physi- cian has the right to settle a medical malpractice claim. There also are versions in which there could be a committee that makes this decision. Settling a lawsuit is important because it has several ramifications to the physician, he said. If settled, the National Practitioner Data Bank and Healthcare Integrity and Protec- EW Ophthalmology Business 52 July 2011 During a 30-year career, the average ophthalmologist can expect to be sued for medical malpractice two or three times

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