Revisiting the basics of medical malpractice
Health care reform has caused uncertainty and stress across the insurance and healthcare provider industries and has prompted some industry consolidation in both fields. Couple this with the questions that we have seen regarding the laws impact on malpractice coverages, WGA is strongly encouraging providers to be diligent when it comes to searching our most comprehensive and fiscally responsible choices for Medical Malpractice Insurance program.
What is Medical Malpractice Insurance? Insurance, in general, is the practice of sharing your risk with a large number of individuals or groups who have a similar risk. While it is nearly impossible to predict the future for an individual, the use of statistical data and actuarial projections allows an insurance company to better predict the outcomes for a large group. These companies collect premiums, based on those predicted outcomes, in exchange for providing financial compensation in the event that a loss occurs. In this way, by paying a small amount up front, the purchasers of insurance can be saved from financial disaster in the long run. Medical Professional Liability (MPL) insurance, or medical malpractice as it is commonly known, is the application of this principle to the medical practitioners and institutions in an effort to protect them financially in the event of a malpractice lawsuit or other claims of medical negligence.
What is Medical Malpractice? While insurance is a common term, medical malpractice coverage is often misunderstood. In order for a lawsuit to proceed as a Medical Malpractice case, it generally must fulfill four different criteria:
- The medical provider must have a duty to the patient.
- The medical provider breached that duty as a result of action or inaction.
- An injury resulted from the breach.
- There must be an established link between the injury and the medical provider.
All four of these elements must be present for a medical malpractice lawsuit to proceed. Otherwise, there is no established case for medical malpractice in most jurisdictions.
Medical malpractice lawsuits are complex and can be very expensive, and because these cases have large payments at stake, both the defense and the plaintiff will aggressively pursue a judgment in their favor. Fortunately for doctors, most of these claims fail because they do not meet all the four above criteria, and are dismissed or won at trial.
Who Provides Medical Malpractice Insurance? There are many different types of companies which provide MPL insurance, all with different advantages and disadvantages. No one type of carrier is best for every physician-depending upon the physician’s situation, using one type of company over another may be a choice or it may be necessary in certain states.
Click here to learn more about these different options in WGA’s latest Whitepaper on Medical Malpractice Insurance and which coverage option is be best for your organization.
About the Author
Pete Reilly is a Senior Vice President and the Healthcare Practice Leader at WGA, with extensive knowledge in healthcare systems, including hospitals, long-term care facilities, and medical practice groups of all sizes.