Health Maintenance Organization Insurance

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Health Maintenance Organization Insurance Policy Information

Health Maintenance Organization Insurance

Health Maintenance Organization Insurance. Health Maintenance Organizations - shortened to HMOs - are a type of health insurance provider using a unique business model. These health insurers partner with a network of physicians.

Subsequently, clients who opt to insure themselves through the Health Maintenance Organization may access covered medical care through this network. This model benefits physicians, as the HMO ensures an influx of patients. It also has marked advantages for patients, who obtain less costly health insurance.

Health maintenance organizations (HMOs) act as both a medical insurance carrier and as the coordinator of health services for its members, who pay a monthly fee to receive all the medical services needed at a reduced cost or co-payment to them.

The HMO contracts with doctors, hospitals, and other health care professionals to serve members 24 hours a day, seven days per week. Members may be required to select a primary care physician (PCP). Except for medical emergencies, this PCP determines the member's need for hospitalization or referrals for specialized services such as diagnostic tests or physical therapy.

Preventive care services are often offered free or at a reduced charge. The HMO is generally limited to a particular geographical area but may have reciprocal agreements with HMOs in different areas to provide service to customers outside their primary service location.

HMOs are regulated at both state and federal levels.

HMOs unquestionably provide an important service. While these insurance providers will do everything they can to run a smooth operation, however, they are subject to a range of risks, just like any other business.

Therefore, HMOs require excellent insurance coverage as well. What types of health maintenance organization insurance coverage are crucial? Discover more in this brief guide.

Health maintenance organization insurance protects your HMO insurance and health services business from lawsuits with rates as low as $77/mo. Get a fast quote and your certificate of insurance now.

Below are some answers to commonly asked HMO insurance questions:


How Much Does Health Maintenance Organization Insurance Cost?

The average price of a standard $1,000,000/$2,000,000 General Liability Insurance policy for small health maintenance organizations ranges from $77 to $99 per month based on location, size, revenue, claims history and more.


Why Do Health Maintenance Organizations Need Insurance?

HMO Health Insurance

As health insurance providers, HMOs will understand the fact that disaster can strike unexpectedly better than most businesses. Health Maintenance Organizations are vulnerable to some of the same risks as any other commercial venture, as well as facing hazards unique to this particular industry.

The office space of a Health Maintenance Organization may be impacted by large-scale acts of nature, such as earthquakes, hurricanes, or wildfires - leading to severe damage to the building, as well as the loss of important smaller assets.

Theft, cyber theft, vandalism, and accidents represent other important threats, along with the sudden breakdown of essential equipment.

Employees, or third parties present on the premises, may be injured for accidental reasons or those related to negligence. HMOs will, likewise, have to consider the costs associated with claims of professional misconduct, which can be astronomical even if the lawsuit is ultimately dismissed.

Any of these perils, alongside numerous others, can lead to such devastating financial consequences that the HMO may not be able to recover - however, protected by excellent insurance coverage, you no longer have to worry about this.

In addition to the fact that you will legally be required to carry certain types of health maintenance organization insurance, this explains, in short, why the right commercial insurance is important.

Some of the largest HMOs in the US include; Aetna, Anthem, Blue Cross Blue Shield, Cigna, Humana, Kaiser Foundation and UnitedHealthcare.


What Type Of Insurance Do Health Maintenance Organizations Need?

Each Health Maintenance Organization will have unique insurance needs. The types of coverage that will best protect your business depend, after all, on factors such as the size of your company, the jurisdiction in which your business is based, your number of employees, and the value of your assets.

Because of this, it is crucial to discuss your individual risk profile with a skilled commercial insurance broker who understands your industry. However, among the key types of health maintenance organization insurance are:

  • Commercial Property - Should your commercial premises be impacted by unforeseen circumstances that include vandalism, theft, and acts of nature, this form of coverage serves the purpose of protecting your HMO from the financial consequences. Your building and its contents are both covered, up to a predefined limit. Flood insurance should be purchased additionally, as that does not fall under most commercial property policies.
  • Commercial General Liability - In the event that your business faces a third party personal injury or property damage claim, this kind of health maintenance organization insurance covers many of the legal costs that arise. Attorney fees, medical bills, repair expenses, and settlement payments are examples of the types of expenses covered.
  • Errors and omissions - Also called E&O insurance, this type of professional liability coverage protects a HMO in the event that a client or a clinic within their network files a lawsuit alleging professional negligence or misconduct. This form of coverage is essential to any insurance provider or company within the financial sector.
  • Workers Compensation - Assuming that you have employees, your business will also need to carry workers' comp insurance in most states. This important form of coverage takes care of the medical expenses of employees who have been injured in the workplace under circumstances for which the company could be held responsible. In addition, it covers any wages the injured employee loses to related work absences.

While HMOs are likely to have further insurance needs - in the forms of commercial auto and cyber security insurance, for instance - these types of coverage will offer a large degree of protection.

To find out what other health maintenance organization insurance policies you may benefit from, direct your questions to a commercial insurance broker.


Health Maintenance Organization's Risks & Exposures

Health Insurance Claim Form

Premises liability exposure is very limited because most member and insurer contact is done over the phone, electronically or by mail. If clients visit the premises, they must be confined to designated areas to prevent them from observing other clients' confidential information or overhearing private conversations.

To prevent slips, trips, or falls, all areas accessible to customers should be well lighted with floor coverings in good condition. The number of exits must be sufficient and well marked, with backup lighting in case of power failure. Parking lots and sidewalks need to be in good repair with snow and ice removed, and generally level and free of exposure to slips and falls.

Personal injury liability exposures include allegations of assault, breach of confidentiality, discrimination, and invasion of privacy.

Professional liability exposures are increasing in some states. The HMO does not technically diagnose illnesses or prescribe treatment but relies on the judgment of participating doctors and other health care service providers.

However, an HMO can deny certain types of services based on cost, the likelihood of a successful outcome, or status of the treatment as experimental or in a clinical testing environment. An HMO may also restrict the amount of time a recuperating patient may spend in a hospital, resulting in allegations of forced early discharge and subsequent worsening of a health condition.

As a result, some states now permit members to sue HMOs directly for medical malpractice. The exposure increases if the HMO fails to conduct thorough background checks to verify employees' credentials and education, if non-professional workers are allowed to make decisions that only professionals should make, or if error checking procedures are ignored or are inadequate.

Workers compensation exposures are primarily those of an office. Since office work is done on computers, potential injuries include eyestrain, neck strain, carpal tunnel syndrome, and similar cumulative trauma injuries that can be addressed through ergonomically designed workstations.

There may also be off-premises travel, which can result in injuries from slips and falls, assaults, or vehicular or aviation accidents.

Property exposure is limited to an office. Extensive phone and computer networks are in place for the handling of claims. Ignition sources include adequacy of electric wiring, heating and air conditioning systems, wear and overheating of equipment. Smoking must be prohibited.

There may be storage of client or medical staff information in paper form, although these are now often digital instead of paper format. Paper should be stored in fireproof cabinets.

Fire suppression systems can result in damage to computers and electronic systems. Computers and other electronic equipment may be targets for theft.

Inland marine exposures are from accounts receivable for credit payments, computers, and valuable papers and records for members' and carriers' information. Power failure and power surges are potentially severe hazards.

Backups of all records must be made regularly and stored off-site. Due to the confidentiality of medical records, adequate security features should be taken to prevent unauthorized access to paper or computerized information.

Crime exposure is from employee dishonesty, computer fraud, and forgery. Employees have access to members' personal medical information. Potential for theft, directly or through identity theft, is great. Background checks should be conducted on all employees.

Hazards increase without monitoring procedures and securing all records to prevent unauthorized access. There must be a separation of duties between persons handling deposits and disbursements and reconciling bank statements.

All activities must be carefully monitored with internal audit systems and checks and balances in place.

Business auto exposure is generally limited to hired and non-owned. If the company supplies vehicles to employees for sales or other types of calls, there should be written procedures in place regarding personal use by employees and their family members.

All drivers must have appropriate licenses and acceptable MVRs. Vehicles must be maintained and records kept in a central location.

Commercial Insurance And Business Industry Classification

  • SIC CODE: 6324 Hospital And Medical Service Plans
  • NAICS CODE: 622210 Psychiatric and Substance Abuse Hospitals
  • Suggested ISO General Liability Code(s): 44430
  • Suggested Workers Compensation Code(s): 8829

Description for 6324: Hospital And Medical Service Plans

Division H: Finance, Insurance, And Real Estate | Major Group 63: Insurance Carriers | Industry Group 632: Accident And Health Insurance And Medical

6324 Hospital And Medical Service Plans: Establishments primarily engaged in providing hospital, medical, and other health services to subscribers or members in accordance with prearranged agreements or service plans. Generally, these service plans provide benefits to subscribers or members in return for specified subscription charges. The plans may be through a contract under which a participating hospital or physician agrees to render the covered services without charging any additional fees. Other plans provide for partial indemnity and service benefits. Also included in this industry are separate establishments of health maintenance organizations which provide medical insurance. Establishments providing these services through their own facilities or employed physicians are classified in Major Group 80.

  • Dental insurance (providing services by contracts with health
  • Group hospitalization plans
  • Hospital and medical service plans
  • Medical service plans

Health Maintenance Organization Insurance - The Bottom Line

To learn more about the exact types of health maintenance organization insurance policies needed, what coverage limits you should carry and the associated premiums - consult with a reputable broker that is experienced in commercial insurance.

Types Of Small Business Insurance - Requirements & Regulations

Perhaps you have the next great idea for a product or service that you know will appeal to your local area. If you've got a business, you've got risks. Unexpected events and lawsuits can wipe out a business quickly, wasting all the time and money you've invested.

Operating a business is challenging enough without having to worry about suffering a significant financial loss due to unforeseen and unplanned circumstances. Small business insurance can protect your company from some of the more common losses experienced by business owners, such as property damage, business interruption, theft, liability, and employee injury.

Purchasing the appropriate commercial insurance coverage can make the difference between going out of business after a loss or recovering with minimal business interruption and financial impairment to your company's operations.

Small Business Information

Insurance is so important to proper business function that both federal governments and state governments require companies to carry certain types. Thus, being properly insured also helps you protect your company by protecting it from government fines and penalties.

Small Business Insurance Information

In the business world, there are many risks faced by company's every day. The best way that business owners can protect themselves from these perils is by carrying the right insurance coverage.

The The National Association of Insurance Commissioners (NAIC) is the U.S. standard-setting and regulatory support organization. Through the NAIC, state insurance regulators establish standards and best practices, conduct peer review, and coordinate their regulatory oversight.

Commercial insurance is particularly important for small business owners, as they stand to lose a lot more. Should a situation arise - a lawsuit, property damage, theft, etc. - small business owners could end up facing serious financial turmoil.

According to the SBA, having the right insurance plan in place can help you avoid major pitfalls. Your business insurance should offer coverage for all of your assets. It should also include liability and casual coverage.

Types Of Small Business Insurance

Choosing the right type of coverage is absolutely vital. You've got plenty of options. Some you'll need. Some you won't. You should know what's available. Once you look over your options you'll need to conduct a thorough risk assessment. As you evaluate each type of insurance, ask yourself:

  • What type of business am I running?
  • What are common risks associated with this industry?
  • Does this type of insurance cover a situation that could feasibly arise during the normal course of doing business?
  • Does my state require me to carry this type of insurance?
  • Does my lender or do any of my investors require me to carry this type of policy?

A licensed insurance agent or broker in your state can help you determine what kinds of coverages are prudent for your business types. If you find one licensed to sell multiple policies from multiple companies (independent agents) that person can often help you get the best insurance rates, too. Following is some information on some of the most common small business insurance policies:

Business Insurance Policy Type What Is Covered?
General Liability InsuranceWhat is covered under commercial general liability insurance? It steps in to pay claims when you lose a lawsuit with an injured customer, employee, or vendor. The injury could be physical, or it could be a financial loss based on advertising practices.
Workers Compensation InsuranceWhat is covered under workers compensation insurance? This type of insurance protects a business and its owner(s) from claims by employees who suffer a work-related injury, illness or disease. Workers comp typically provides the injured employee with benefits to cover medical expenses, a portion of his/her lost wages, rehabilitation costs if applicable, and permanent partial or permanent total disability.
Product Liability InsuranceWhat is covered under product liability insurance? I pays an injured party's settlement or lawsuit claim arising from a defective product. These are usually caused by design defects, manufacturing defects, or a failure to provide adequate warning or instructions as to how to safely use the product.
Commercial Property InsuranceWhat is covered under business property insurance? General liability policies don't cover damages to your business property. That's what commercial property insurance is for. It protects all of the physical parts of your business: your building, your inventory, and your equipment, giving you the funds you need to replace them in the event of a disaster. If you work from home, you might consider a Home Based Business Insurance policy instead.
Business Owners Policy (BOP)What is covered under a business owners policy (BOP)? This is a policy designed for small, low-risk businesses. It simplifies the basic insurance purchase process by combining general liability policies with business income and commercial property insurance.
Commercial Auto InsuranceWhat is covered under business auto insurance? This type of insurance covers automobiles being used for business purposes. This could include a fleet of business-only vehicles or a single company car. In some cases it might cover your car or your employee's car while they're being used for business. These policies have much higher limits, ensuring you can cover your costs if one of these vehicles gets into an accident.
Commercial Umbrella PoliciesWhat is covered under commercial umbrella insurance? This type of policy is a sort of "gap" insurance. It covers your liability in the event that a court verdict or settlement exceeds your general liability policy limits.
Liquor Liability InsuranceWhat is covered under liquor liability insurance? It covers bodily injury or property damage caused by an intoxicated person who was served liquor by the policy holder.
Professional Liability (Errors & Omissions)What is covered under professional liability insurance? This type of business insurance is also known as malpractice oe E&O. It covers the damages that can arise from major mistakes, especially in high-stakes professions where mistakes can be devastating.
Surety BondWhat is covered under surety bonds? Bonding is a contract where one party, the SURETY (who assures the obligee that the principal can perform the task), guarantees the performance of certain obligations of a second party, the PRINCIPAL (the contractor or business who will perform the contractual obligation), to a third party, the OBLIGEE (the project owner who is the recipient of an obligation).


Who Needs General Liability Insurance? - Virtually every business. A single lawsuit or settlement could bankrupt your business five times over. You might also need this policy to win business. Many companies and government agencies won't do business with your company until you can produce proof that you've obtained one of these policies.

Business Insurance Required by Law
Small Business Commercial Insurance

If you have any employees most states will require you to carry worker's compensation and unemployment insurance. Some states require you to insure yourself even if you are the only employee working in the business.

Your insurance agent can help you check applicable state laws so you can bring your business into compliance.

Other Types Of Small Business Insurance

There are dozens of other, more specialized forms of small business insurance capable of covering specific problems and risks. These forms of insurance include:

  • Business Interruption Insurance
  • Commercial Flood Insurance
  • Contractor's Insurance
  • Cyber Liability
  • Data Breach
  • Directors and Officers
  • Employment Practices Liability
  • Environmental or Pollution Liability
  • Management Liability
  • Sexual Misconduct Liability

Whether you need any or all of these policies will depend on the results of your risk assessment. For example, you probably don't need an environmental or pollution policy if you're running an IT company out of a leased office, but you would need data breach and cyber liability policies to fully protect your business.

Also learn about small business insurance requirements for general liability, business property, commercial auto & workers compensation including small business commercial insurance costs. Call us (855) 767-7828.

Additional Resources For Medical Insurance

Discover small business insurance for medical and dental professionals. Medical malpractice insurance is a type of professional liability that protects health care professionals from liability causing in bodily injury, medical expenses and property damage.


Medical And Dental Insurance

Health care providers are the most trusted individuals in our society. Ironically, they are the same ones who can do the greatest harm. They actually have the right to invade our bodies with knives and to poison us with chemicals - all in the name of health care and with the goal of relieving our symptoms and hopefully bringing about a cure.

While the actions of these professionals normally benefit us, insurance coverage must be available for the times when mistakes happen and things go wrong. These professionals and their facilities have extensive property exposures that are becoming more and more intricate and whose values are increasing exponentially.

The 'one size fits all' approach that once could have applied to insurance for health care providers and their facilities no longer applies.

Professional liability offers protection against claims of malpractice for all sums that the medical professional becomes legally obligated to pay as damages because of rendering or failing to render professional services.

Professional and medical malpractice exposures are the most expensive and difficult of all exposures for health care providers. The commercial general liability policy excludes these exposures so separate coverage is needed. Most professional liability policies are written on a claims-made basis and, as a result, tail coverage and retroactive dates are important coverage issues to be aware of when evaluating the insured’s coverage needs and comparing coverages.

The coverage provided is often called medical malpractice. For decades, many involved in the health care field and insurance companies that provide insurance coverage to providers have stated that malpractice lawsuits have created an ongoing crisis of restricting insurance availability, due to loss of insurance companies that write the coverage and significant rate increases.

As a result, state legislatures have taken the following actions to address the situation:

Imposed a dollar limitation of liability for malpractice suits.

Modified statutes of limitation to limit the number of years that a suit may be brought against a physician following a negligent act.

Modified when the statute of limitations takes effect. An example is beginning from a negligent act's occurrence rather than from its discovery.

Passed laws to modify tort law procedures and doctrines that relate to malpractice.

Because of differences in law by state it is important to know the states in which the covered health care providers are licensed and regularly practice. Some health care providers may practice in multiple states because of their particular specialty, their reputation or the demand for their services. Some hospitals may have ownership in facilities or provide services to patients that are outside of their main location state.

Minimum recommended small business insurance coverage: Business Personal Property, Business Income and Extra Expense, Employee Dishonesty, Money and Securities, Accounts Receivable, Computers, Physicians and Surgeons Floater, Valuable Papers and Records, General Liability, Employee Benefits, Professional, Umbrella, Hired and Non-owned Auto & Workers Compensation.

Other commercial insurance policies to consider: Building, Earthquake, Equipment Breakdown, Flood, Leasehold Interest, Real Property Legal Liability, Computer Fraud, Forgery, Cyber Liability, Employment-related Practices, Business Automobile Liability and Physical Damage and Stop Gap Liability.


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