Most medical professionals could not financially survive a malpractice lawsuit. Medical malpractice insurance allows health care professionals to continue with their careers even when they have been found liable in a malpractice lawsuit.
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How many doctors could financially afford to pay the costs associated with a lawsuit? The answer would be somewhere between one and five percent of all health care professionals. This indicates that 95 percent of all health care providers would be unable to maintain their practice or institution if they were found liable in a lawsuit. Medical professional liability insurance not only pays the insured’s legal fees, but will also pay the award amount up to the coverage limit purchased by the insured.
The High Cost Of Defending A Lawsuit
Defense costs in these lawsuits rose from $15,000 per physician claim in 1991 to $29,500 in 2001. Defense costs for paid medical malpractice insurance claims more than doubled from $21,000 in 1991 to $44,000 in 2003 and almost doubled from $12,000 to $23,500 for no payment claims. This trend has continued in recent years. Research indicates that the average cost of defending one lawsuit is $45,500 and the total liability cost associated with the suit is approximately $115,000 with the average payout for each plaintiff verdict averaging around half a million dollars.
Protecting Your Employees & Yourself From Financial Ruin
Most physicians will encounter at least one lawsuit in their professional career. With the majority of jury awards averaging around half a million dollars, protecting your employees and yourself from financial ruin is a top priority. The best method for doing this is to purchase medical malpractice insurance from a reliable carrier. By purchasing this coverage, you are transferring your defense costs and the liability of payment to the medical malpractice insurance company.
Keeping The Doors Open After A Suit
Without being insured in today’s litigious environment, keeping a practice open would be almost impossible. Based upon available statistical data, the defense costs alone for a lawsuit are prohibitively high. If additional payouts, such as awards, are added to the compilation, most medical practices would be forced to close their doors. Medical professional liability insurance transfers the financial and legal burden onto the carrier, allowing the practice to continue operating without additional legal and financial encumbrances.
Special Coverage For Practices (Billing Errors & Omissions, Etc.)
Good, solid coverage is not only a best practice when protecting yourself and your employees from suits that involve harm. It is also a great idea for physicians and practices that do their own billing. Having sufficient protection to cover claims alleging errors in duplicate billing, billing for services not rendered or unnecessary, billing for services that do not meet standard of care practices, and billing for supervision of residents is also advisable. While it might appear trivial, these little costs can add up to big headaches. By including billing errors and omissions in with your insurance package, you will be protecting your practice from processing mistakes that could cut into your overhead expenses.