Dental Malpractice Advisor

DENTAL MAL P RAC TICE ADVIS OR:

STUDENT GUIDE TO

PROFESSIONAL LIABILITY INSURANCE

INTRODUCTION Choosing a professional liability insurance carrier is one of the most important practice decisions that you’ll make, and it’s not a decision to be taken lightly. Whether you’re a dentist in a solo practice or a group in search of coverage, it’s important to research your options and select the professional liability insurance that meets your needs.

The premium must be weighed against the protection, service, financial strength, and the long-term stability provided by the insurer. Dentists should also review an insurer’s claims defense performance, patient safety/ risk management services, underwriting standards, actuarial discipline, and whether the company adequately protects its policyholders from unlimited personal liability.

Today—more than ever—you can’t afford to be wrong in your choice of an insurer. Because your reputation and livelihood are on the line, you need a dedicated insurer that can protect you against allegations of medical malpractice.

We hope this guide helps you become familiar with your medical liability insurance options and

CONTENTS 3 Types of Policies 4 WHAT IS NOSE COVERAGE? 4 WHAT IS TAIL COVERAGE? 5 UNDERSTANING COVERAGE LIMITS 5 CONSENTING TO SETTLE 6 SEVEN CRITICAL QUESTIONS 8 CYBER LIABILITY 10 PATIENT SAFETY CHALLENGES 13 ROUNDING OUT YOUR INSURANCE PORTFOLIO

terms.

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Professional Liability INSURANCE 101

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TYPES OF POLICIES The most common types of coverage are claims-made and occurrence, although today most professional liability insurance carriers offer only claims-made policies. Since these types of insurance provide fundamentally different protection, you should clearly understand their differences.

CLAIMS-MADE POLICIES

In a claims-made policy, a covered event must occur and the claim made during the policy period. Coverage is usually triggered when an incident is reported (report trigger); however, in some policies coverage is triggered only when a demand for payment is made (demand trigger). Since few claims will be reported during the early years of a claims-made policy, the insurance company has less risk exposure than it will have in subsequent years. For this reason the premium is initially lower and gradually increases step-wise until the full risk exposure is reached. This generally occurs after four years, at which time the premium is said to be mature.

2016

POLICY 3

2015 2014

POLICY 2 POLICY 1

OCCURRENCE POLICIES

In an occurrence policy, any claim arising from an event occurring in the policy period is covered, regardless of when the claim is reported or when in the future it needs to be paid. The long time between the occurrence of an adverse medical event and the time when a claim is paid (typically three to five years) makes it difficult for malpractice insurance companies to predict the ultimate costs of losses. Since today’s premiums must cover future losses regardless of when they are reported, malpractice occurrence policies are seldom offered. Furthermore, the limits of liability in an occurrence policy issued today may be inadequate for a claim that is made years from now.

2016

POLICY 3

2015 2014

POLICY 2 POLICY 1

Example: Policy #3 and its corresponding limits will govern an incident that occurred in 2014 but is reported in 2016.

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WHAT IS WHAT IS TAIL NOSE COVERAGE? COVERAGE?

Tail coverage protects you against all claims that arise from professional services performed while the claimsmade policy was in effect, but which were reported after the termination of the policy. Some insurers offer this feature free of charge for retiring dentists who meet certain requirements.

Claims-made coverage can be extended back by adding nose coverage for prior events. With nose coverage, the insurer agrees to cover claims made during the policy period based on events that occurred prior to the inception date of the policy.

When a dentist retires or moves to a different insurance carrier, he or she may obtain tail coverage. This provides insurance for a covered event that occurred during the policy period even if the claim is not reported until later.

If a dentist moves from one carrier to another, the individual can choose between a tail policy with the expiring carrier and nose coverage with the new carrier.

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UNDERSTANDING POLICY LIMITS A policy limit is the maximum amount paid under the terms of a policy. A professional liability insurance policy usually has two limits, a per-claim limit and an annual aggregate limit. It is important to ask about policy limits when you shop for professional liability coverage.

PER CLAIM LIMIT

ANNUAL AGGREGATE LIMIT

For claims-made carriers, the annual aggregate limit is the maximum amount the carrier will pay for all claims arising from incidents that occurred and were reported during a given policy year. For occurrence carriers, the annual aggregate limit refers to the maximum amount the carrier will pay for all claims arising from incidents that occurred during a given year of insurance.

ANnUAL AGgREGATE LIMIT

CONSENT TO SETTLE Claims management requires both the prompt review of claims by experienced claims specialists and the vigorous defense of policyholders against nonmeritorious claims. In instances where there is negligence, the company should attempt to settle claims quickly and fairly with the dentist’s consent.

Where permitted, a guaranteed consent-to-settle provision should be included in your policy. This requires the carrier to obtain the dentist’s written consent in order to settle any claim and gives the dentist control over whether claims are settled.

Absent this provision, a policy may contain a “hammer” clause that pressures the dentist into consenting to settle; i.e., if a jury award exceeds a settlement offered by the carrier and accepted by the plaintiff but rejected by the dentist, the proposed settlement amount becomes the policy limit and the company is not obligated to pay the amount that exceeds the offered settlement nor the legal fees incurred after the refusal to consent.

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SEVEN

CRITICAL QUESTIONS TO ASK WHEN CHOOSING YOUR PROFESSIONAL LIABILITY INSURER

Whether you’re choosing dental malpractice insurance for the first time or seeking additional coverage for an established practice, selecting the right insurer is one of the most important decisions you’ll make. When your reputation and livelihood are on the line, you need a powerful ally on your side. Research your options and ask the right questions to prospective insurance providers:

1

If a claim is filed against you, how will the insurer defend you?

Few things in a dentist’s professional life generate more stress and disruption than an allegation of malpractice. Effective claims management starts with the prompt review of a claim by an experienced claims specialist.

Select the insurance provider that offers the strongest defense and provides you with individual support to help alleviate the stress and anxiety that accompany a malpractice claim.

2

What is the carrier’s financial strength?

It’s essential that the malpractice insurer has sufficient financial resources to pay all current and future claims against policyholders. Consider the following when evaluating a carrier’s financial strength against its competitors: »» A.M. Best Company and Fitch Ratings »» Years in business »» Assets 6

3

Does the insurer offer a dividend or loyalty program?

Why shouldn’t you be rewarded for keeping claims low and for your loyalty to the insurer? Inquire about dividends and loyalty programs—not all insurance providers offer these plans.

4

Does the insurer offer coverage solutions that meet your needs?

In today’s changing healthcare environment, it’s important to choose an insurer that knows the business risks inherent in dental practices and offers innovative solutions to protect you from emerging exposures, including: »» Cyberattacks and data breaches »» HIPAA violations »» Medicare reviews

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Is the insurer committed to being your strategic ally?

Navigating today’s complex healthcare environment requires an insurer that does more than pay claims.

A strong, effective business partner will also: »» Provide data that reveals liability trends in your specialty and helps improve safety in your practice environment.

»» Successfully support medical liability reform and vigorously advocate in defense of the practice of good medicine.

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Does the insurance provider have local expertise?

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What additional tools and resources are offered by the insurer?

The best carrier will have a combination of national presence and local expertise. A strong national reach provides the scope and resources to identify emerging risks and respond with innovative solutions for all specialties, while a local presence lends unique regional insights. An insurer that has an established multistate presence may have a portable policy that will allow you to be covered wherever you practice.

Select an insurer that offers the tools and resources you need to help reduce risk and keep your practice safe. Your coverage should include access to CMEs, online disclosure resources, and health literacy tools, as well as personalized risk management services and patient safety programs.

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CYBER LIABILITY CYBERSECURITY: MITIGATE AGAINST HACKING, RANSOMWARE, AND DATA BREACH RISKS

The Doctors Company is the first insurer to include $50,000 base coverage protection for cyber liability in their professional liability plan – one of the fastest-growing threats to your practice.

Cybercrime costs the U.S. economy billions of dollars each year and causes organizations to devote substantial time and resources to keeping their information secure.

This is even more important for healthcare organizations, the most frequently attacked form of business.

Choosing a professional liability insurance policy with cyber liability coverage will protect you against regulatory and liability claims arising from the theft, loss, or accidental transmission of patient or financial information, as well as the cost of data recovery.

PERCENTAGE OF TOTAL

BREACHES THAT OCCUR IN:

51% 23% 14% % 9 3% HEALTHCARE CORPORATE GOVERNMENT ENTITIES ENTITIES ENTITIES

ACADEMIC ENTITIES

OTHER ENTITIES

Healthcare entities are the most vulnerable to cyberattacks. Health data is more valuable to criminals than credit card numbers because it contains details that can be used to: ›› Access bank accounts. ›› Obtain prescriptions for controlled substances.

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MAKE SURE YOU ARE

CYBERSECURE 1.

IDENTIFY

5 Keys to HIPAA Compliance

all areas of potential vulnerability. Does your office have adequate physical security? Do you have adequate electronic security for computers containing protected health information (PHI)?

2.

ENCRYPT

all devices that contain PHI (laptops, desktops, thumb drives, and centralized storage devices). Loss or theft of devices is one of the most recognized risks, and encryption is the best way to prevent the disclosure of PHI.

3.

TRAIN

staff on how to protect PHI. Ensure your office policies are compliant with the Health Insurance Portability and Accountability Act {HIPAA). Restrict open discussion of patient PHI among staff members.

KNOW THE TOP 3 WAYS A BREACH OCCURS 29% THEFT

Theft of unencrypted electronic devices or physical records is the most common method of breach in healthcare entities.

23% HACKING

Hacking is the most common method of breach for corporate entities.

20% PUBLIC ACCESS/ DISTRIBUTION

The largest fine paid by a healthcare entity to date was because patient records were accidentally made publicly accessible on the Internet.

4.

AUDIT/TEST

physical and electronic security policies and procedures regularly-including the steps your practice will take in the event of a potential breach.

5.

INSURE

your business.

Cybersecurity insurance can protect you from the potential high costs associated with a breach.

AVOID THE

WALL OF SHAME

PROTECT YOUR REPUTATION AND LIVELIHOOD

$25,000,000

$4,800,000

Total HIPAA fines to date

Largest fine to date against a healthcare instituion

The U.S. Department of Health & Human Services posts a list of entities involved in breaches affecting 500 or more individuals.

Securing PHI safeguards your good name and helps you avoid substantial penalties.

Sources: Information Security & Data Breach Report: http://ow.ly/FZX9r; Healthcare Industry Lacks Adequate Cybersecurity, Says FBI: http://ow.ly/ FZXry; Breaches Affecting 500 or More Individuals: http://ow.ly/zWfl4; Hospitals Fined $4.BM for HIPAA Violation: http://ow.ly/zWfEx

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PATIENT SAFETY CHALLENGES IN GENERAL DENTISTRY The guidelines suggested in this article can help dentists address patient safety issues in general dentistry practices.

By David O. Hester, FASHRM, CPHRM, Director, Department of Patient Safety and Risk Management, The Doctors Company

INFECTION CONTROL

Following these infection control practices vigilantly can reduce the chance that you, your staff, or your patients will become infected: »» Always wash your hands before donning gloves and again after removing them.

Change gloves between patients. »» When gloved, don’t touch noncritical patient care items that are not barrier protected or cleaned between patients. »» Wear your personal protective equipment. »» Use any single-use disposable instrument only once, and then dispose of it properly. »» Follow the manufacturer’s directions for autoclaving dental instruments. Perform biological monitoring, and document the monitoring results. Store sterilized instruments in a clean, dry, and protected environment. »» Establish a dirty area for processing and cleaning instruments in preparation for autoclaving to avoid cross-contamination of clean and sterilized items. »» Select appropriate devices that reduce aerosol and droplet formation and the potential for sharps injuries. »» Ensure that everyone follows universal precautions with every patient. »» Manage occupational exposure to blood-borne pathogens, including post-exposure prophylaxis for work exposure to hepatitis B virus, hepatitis C virus, and HIV. »» Check dental unit water lines, biofilms, and water quality regularly.

DENTAL HISTORIES

Ask patients the right questions in the dental history. At a minimum, the questionnaire should include a patient’s appraisal of current health status, current medical treatment and medications, history of disease by system (with attention to congenital or valvular heart disease), and a history of high blood pressures, stroke, diabetes, thyroid function, bleeding disorders, malignancy, AIDS, chronic or acute infections, allergies, and venereal disease. The questionnaire should also include the status of pregnancy and the existence of pacemakers, valvular replacements, and prosthetic joints.

The dental history should also include information regarding previous dental work, radiographs, oral hygiene practice, oral habits, attitudes toward dentistry, and the reason for the patient’s visit.

Identify high-risk patients, and place an alert in their dental records in a conspicuous location. High-risk patients include those on anticoagulants, immunosuppressants, bisphosphonates, and other treatments or medications for chronic medical conditions.

PATIENT SELECTION

Selecting the right patient is imperative. This is especially true for elective aesthetic procedures, which are the most frequent cause of litigation in general dentistry. When interviewing a patient for an elective procedure, consider the individual’s chief complaint and concerns, expectations, aesthetic concerns, and needs. For more on this topic, read our article “Patient Selection for Elective Procedures.” Be especially cautious in planning treatments for patients who have unrealistic expectations and patients who demand an assurance or guarantee of results.

COMPLIANCE

Follow state laws when purchasing, registering, and maintaining radiology equipment.

For example, you must comply with manufacturers’ recommendations on maintenance schedules and record keeping. Employees who operate or work around radiological equipment must receive safety training. Additionally, dental offices generate medical waste, including sharps, pharmaceuticals, and biohazardous materials. Medical waste disposal is governed by state law through the Occupational Safety and Health Administration (OSHA).

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SCOPE OF PRACTICE

When a general dentist ventures outside the scope of practice, complications may result in harm to the patient. For example, lingual nerve dysesthesia is a serious complication that can occur when a dentist practices beyond his or her experience and expertise. This type of patient injury can be prevented through referral, treatment selection, choice of technique, and common sense. If, however, a complication occurs, the dentist should refer the patient to a reputable oral surgeon in the area. Every general dentist should establish a good working relationship with a local oral surgeon.

PATIENT MISHAPS

Handle patient mishaps carefully. For example, if a patient inadvertently swallows part or all of a tooth, crown, or dental instrument, inform the patient immediately, and refer him or her for a chest or gastrointestinal x-ray. Any abnormal results should be reviewed by the patient’s physician, and a follow-up appointment with the physician should be scheduled. Document the dental record with any treatments provided and all discussions of the event, treatment options, and referrals for medical care. Coordinate arrangements with the patient and the treating medical practitioner for medical care and x-rays. Communicate with the patient’s physician and maintain a dialogue with the patient. Notify your patient safety risk manager.

Contact the Department of Patient

Safety and Risk Management at The Doctors Company for guidance and assistance in addressing any patient safety or risk management concerns.

David O. Hester, FASHRM, CPHRM, Director, Department of Patient Safety and Risk Management (800) 421-2368, extension 1243 patientsafety@thedoctors.com www.thedoctors.com

The guidelines suggested here are not rules, do not constitute legal advice, and do not ensure a successful outcome. The ultimate decision regarding the appropriateness of any treatment must be made by each healthcare provider in light of all circumstances prevailing in the individual situation and in accordance with the laws of the jurisdiction in which the care is rendered.

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ROUNDING OUT YOUR INSURANCE PORTFOLIO FDA Services is your trusted partner, offering all the coverage options you need in one convenient location.

OFFICE PACKAGE

LONG-TERM CARE

WORKERS’ COMPENSATION

AUTO & BOAT

Top-rated carriers offer coverage for your building, business personal property and business liability exposures, including replacement cost coverage, loss of income and more.

Get valuable coverage you should carry for all employees for job-related accidents and illnesses. Coverage and rates are state-mandated, wherever you buy your policy.

LIFE INSURANCE

Dentist Insurance Services offers a full range of life insurance products from the top carriers. From term life, whole life, and universal life, we have the product needed to secure your family’s financial future.

Long-term care insurance protects your assets by paying for home care, an assisted-living facility, adult day care or a nursing home stay. Long-term care insurance provides funding for your care if you cannot care for yourself.

Competitive quotes and personal service make policies through Dentist Insurance Services your best choice for auto and boat coverage!

DISABILITY INCOME

What would happen if you were to become disabled? Your ability to earn an income is your most valuable asset and it should be protected! Disability Insurance replaces a part of your regular income if you are sick or injured and can’t work.

This coverage will put your mind at ease and help you protect you and your family in the event of a disability. Be sure to ask about available discounts. Student discounts are available while in dental school and up to 60 days after graduation.

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WHAT ARE THE CHANCES THAT YOU COULD BECOME DISABLED AND UNABLE TO WORK?

There is a 3 in 10 chance that you will suffer a disbility that keeps you out of work for 90 days or longer at some point in your career.1 90% ILLNESS 10% INJURY

90% of disabilities are caused by illness, not accidents.2 1

The Real Risk of Disability in the United States, Milliman Inc., May 2007.

2

The Council for Disability Awareness, Long-Term Disability Claims Review, 2010

QUESTIONS?

TRY YOUR AGENT

If you have any questions about your professional liablity coverage, the Dentist Insurance Services insurance experts are standing by to help.

DAN ZOTTOLI

DIRECTOR OF SALES ATLANTIC COAST Phone: 561.791.7744 dan.zottoli@fdaservices.com

DENNIS HEAD

JOSEPH PERRETTI

DIRECTOR OF SALES DIRECTOR OF SALES CENTRAL FLORIDA SOUTH FLORIDA Phone: 407.359.9700 Phone: 305.665.0455 dennis.head@fdaservices.com joe.perretti@fdaservices.com

MIKE TROUT

DIRECTOR OF SALES NORTH FLORIDA Phone: 904.249.6985 mike.trout@fdaservices.com

RICK D’ANGELO

DIRECTOR OF SALES WEST COAST Phone: 813.475.6948 rick.dangelo@fdaservices.com

Toll-free 800-877-7597 | www.FDAServices.com | Insurance@FDAServices.com

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