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Healthcare Facilities Insurance Policy Information

Healthcare Facilities Insurance. Healthcare facilities have unique insurance needs, and a business owner's policy is one first line of coverage to meet those needs. However, because of the many inherent risks faced by healthcare facilities and the providers and employees working in them, it is necessary to carry the right level of insurance to meet your facilities needs in order to guard against potential liabilities.

Risks such as slips and falls, contamination, personal data theft, and property damage all loom and are all potential perils that your facility faces each and every day. There are also unique perils that are specific only to the healthcare industry that you should consider when making a healthcare facilities insurance policy purchase.

Medical clinics provide healthcare services on an outpatient basis. While originally formed to provide low-cost medical services to the poor and destitute and to provide a learning facility for medical students, they now provide the services one could normally obtain in a doctor's office.

Many clinics have become specialized treatment centers that provide a service or group of services in a particular field of medicine such as pediatrics or physical therapy. Other clinics are part of a Health Maintenance Organization (HMO) and provide medical treatment to group participants.

A clinic generally employs licensed primary care doctors who pre-screen patients according to their symptoms, prescribe medication for common ailments, and refer patients in need of more focused medical attention to specialists.

Most doctors working in clinics refer patients to a hospital or other medical facility for laboratory tests, surgery, or post-operative care.

Hospitals and infirmaries provide medical treatment to patients on an outpatient or inpatient basis. Medical facilities include patient rooms for in-house treatment and care, medical testing laboratories, pharmacies, surgery or operating rooms, and access to both doctor and nursing care at all times.

While some hospitals support all types of medical care, including emergency medical assistance, others limit their services to such specialties as burn treatment, cardiology, intensive care, neurology, obstetrics/gynecology, oncology, orthopedics, pediatrics, psychiatry, radiology, spine treatment, or weight loss.

Many hospitals have cafeterias or restaurants, gift shops, and waiting areas for visitors. Some offer additional services such as counseling, health classes, libraries, religious services, and lodging for guests.

A hospital may be funded by charitable or religious organizations, Medicaid, Medicare, or private insurers. Some are teaching hospitals that provide training to medical students while offering lower-cost services to patients.

An infirmary is normally not as elaborate as a hospital; however, it does provide the same basic services on a more limited basis.

Healthcare facilities insurance protects your facility from lawsuits with rates as low as $127/mo. Get a fast quote and your certificate of insurance now.

Below are some answers to commonly asked healthcare facility insurance questions:

• What Is Healthcare Facility Insurance?
• How Much Does Healthcare Facility Insurance Cost?
• Why Do Healthcare Facilities Need Insurance?
• What Type Of Insurance Do Healthcare Facilities Need?
• What Does Healthcare Facilities Insurance Cover & Pay For?

Medical Clinic's And Hospital's Risks & Exposures

Premises liability exposure for medical clinics is moderate due to patients' access to the premises. To prevent trips, slips, and falls, all areas accessible to patients must be well maintained with floor covering in good condition. The number of exits must be sufficient, and be well marked, with backup lighting in case of power failure. Steps should have handrails, be illuminated, marked, and in good repair. Parking lots should be maintained free of ice and snow. Housekeeping should be excellent and spills must be cleaned up promptly.

If surgery is performed, the area must be kept sterile at all times and carefully controlled. The patients' area must be designed for patients who are physically impaired following surgery. Escort procedures must be clear for all personnel. Maintaining a patient's privacy is critical. Examination rooms, check-in and checkout stations must be in private areas so one patient cannot view information or overhear conversations regarding another patient's' confidential information.

Premises liability exposure for hospitals is high due to a large number of visitors to the premises and the impaired physical mobility of patients. Public and life safety code compliance is very important. Excellent housekeeping is required to reduce the number of trips, slips, and falls. Spills must be cleaned up promptly. Hallways, rooms, and recreational areas must be orderly and well maintained. Stairways, elevators, railings, and floor coverings should be in good condition. Exits should be clearly marked and free of obstacles. Adequate interior and exterior lighting should be available in the event of a power outage. Steps must have rails, be illuminated, marked, and in good maintenance and repair.

There should be a temperature-monitoring device in all bathing and showering areas to prevent scalding. Parking lots should be maintained free of ice and snow. A major concern in the area of patient safety is the type of backup facilities available for power outages and loss of normal utilities. Emergency generators should be in place, checked and maintained periodically. Security at the facility, as well as in the building, corridors, and any owned parking area needs to be carefully checked and reviewed because the facility may be held liable should a patient or visitor be attacked on the premises. Should an emergency situation arise, there should be evacuation plans in place to quickly move patients to a safe area.

Personal injury exposures include discrimination, invasion of privacy, and wrongful eviction. Maintaining a patient's privacy is critical. Examination rooms, check-in and checkout stations must be in private areas so one patient cannot view information or overhear conversations regarding another patient's confidential information. Inappropriate touching and sexual misconduct must be considered.

Background checks should be conducted before hiring any employee. The hospital should be accredited and operate within the guidelines of that accreditation. If it is on probation, there should be active plans to comply with open recommendations to be taken off probationary status.

Professional liability exposure for medical clinics is extensive as most clinics serve patients either who have no regular physician or whose regular physician is unavailable. Decisions are made based on limited background information with verification of medical history generally unavailable. The exposure increases if the provider fails to conduct thorough background checks to verify employees' credentials, education, and licensing. Staff turnover is high in clinics, disrupting continuity in patient care.

Records must be well-documented and prior data obtained as much as possible. The prescreening questionnaire is vital. Very serious losses may result from failure to secure patient approval before performing procedures, including vaccinations. Training and safety equipment should be in place to prevent exposure to radiation when performing X-rays. Needles and other equipment must be sterilized and sanitized to prevent the spread of blood-borne infectious diseases such as hepatitis, HIV, and AIDS.

On-site surgery must be closely monitored, with an experienced trained individual administering and monitoring the use of the anesthetic. Finally, inappropriate touching and sexual misconduct must be considered.

Professional, medical malpractice, and directors and officers exposures for hospitals are very high. Staff turnover is high, disrupting continuity in patient care. The exposure increases if the facility fails to conduct thorough background checks to verify employees' credentials, education, and licensing. Hospitals should be subject to regular inspections by their accreditation organization. It should also be licensed and staffed based on federal and state requirements.

The staff/patient ratio should be sufficient to provide adequate care for patients. Supervision is essential along with regular training, monitoring, and well-written and followed procedures. Patients must be informed as to their rights to obtain or refuse medical care as described by state and federal law. Very serious losses may result from failure to secure patient approval before performing procedures. Access to patients' records must be restricted to those having a legitimate reason for viewing them. Medical records must be duplicated and stored off-site.

Both on-site and off-site records must be safeguarded to protect patients' right to privacy. Patient plans should be in place and followed by all staff members. Only patients who are within the appropriate level of care within the hospital's license should be admitted and allowed to remain in the facility. Needles and other equipment must be sterilized and sanitized to prevent the spread of blood-borne infectious diseases such as hepatitis, HIV and AIDS. There should be a formal review process in place for reviewing all incidents that may give rise to a claim of medical malpractice.

The hospital environment can lend itself to the spread of diseases like MRSA if not handled immediately. Access to all pharmaceuticals must be carefully controlled, with procedures in place for the proper dispensation to patients. Finally, inappropriate touching and sexual misconduct must be considered.

Environmental impairment exposure for hospitals is significant due to the potential for contaminating the air, ground, or water supply by improperly disposing of medical waste, including contaminants such as hepatitis B or the AIDS virus. Disposal must be documented and meet all FDA and EPA standards.

Workers compensation exposure for medical clinics is due to the possible transmission of disease from a patient. Gloves and masks must be worn at all times when working around any bodily fluids. Unruly or unpredictable patients can cause harm including strains, back injuries, and contusions. Employees should have access to vaccinations to prevent diseases.

Training and safety equipment should be in place to prevent exposure to radiation when performing X-rays. Because patient information and billings are 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. Workers who travel off site may encounter difficult circumstances, especially when going into patients' residences. Procedures should be in place to monitor the off-site exposure and provide for emergency backup.

Workers compensation exposure for hospitals comes from contact with patients, from infections, and from communicable diseases such as hepatitis, HIV, AIDS, or MRSA. Employees should have access to vaccinations to prevent diseases. Gloves and masks should be worn at all times when working around any bodily fluids. All CDC recommended procedures for handling bodily fluids must be followed. Constant cleansing with disinfectants can result in the lung, eye, or skin irritations and reactions.

Accidental piercings from needles and cuts from scalpels are common. X-ray technicians should wear leaded aprons to limit exposure to harmful radiation. Back injuries, sprains, and strains can occur when assisting or lifting patients. Procedures should be in place for safely handling unruly or violent patients to minimize injury to both the patient and the employees. Slips and falls can occur from tripping over objects or slick floors. Kitchen work includes the possibility of cuts, scrapes, and burns.

Because patient information and billings are 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.

Property exposure for medical clinics is high due to the use of expensive diagnostic and medical equipment. Ignition sources include electrical wiring, heating, and air conditioning systems, and overheating of equipment. All electrical wiring must be up to code and equipment properly maintained. Excellent housekeeping is required and smoking should be prohibited. A small fire, which produces smoke, can cause considerable damage when sterile equipment and environments are compromised.

If pharmaceuticals are kept on premises, theft is a concern. These items should be inaccessible for unauthorized use and stored in a protected area after hours. Most property items are better covered on inland marine forms such as a computer form or the physicians and surgeons floater. The business income and extra expense exposure can be minimized if the clinic has arranged for temporary facilities with another clinic.

Property exposures for hospitals are extensive. Ignition sources include electrical wiring, heating, and air conditioning systems, diagnostic and treatment equipment, laundry equipment, and cooking appliances. All electrical wiring must be up to code and equipment properly maintained.

Licensing and certification ensure that housekeeping is excellent and that controls are in place for patient safety. Smoking is not permitted in hospitals and that ban must be enforced. There should be smoke detectors installed in all patient rooms and common areas. Oxygen and other surgical gases in use around the hospital are flammable and must be controlled. Even a small fire can cause extensive damage due to the requirement of a sterile environment. All kitchen grills and deep fat fryers must have fire extinguishing protection, hoods, and filters.

There should be automatic fuel shut off valves and adequate hand-held fire extinguishers. Theft is a major concern because of the large quantities of drugs stored on premises. Tight controls must be in place including, but not limited to, inventory control and limited access to the drug room. Business income and extra expense losses can be severe due to the cost of diagnostic equipment, the time it may take to repair or replace a damaged item, and the unavailability of backup facilities.

Equipment breakdown exposures for hospitals and clinics are high as operations are dependent on medical equipment being available. All equipment should be maintained on an ongoing basis.

Crime exposure for medical clinics comes from employee dishonesty of both money and inventory, particularly relating to drugs on premises. The potential for theft, directly or by means of identity theft, is great. Background checks should be conducted on all employees with access to drugs or money. Since drugs are tempting and susceptible to theft, employee access must be restricted and carefully monitored.

Ordering, billing and disbursement transactions should be handled as separate duties. Inventories and audits should be performed regularly. Money and securities are a concern if payments are accepted on premises. Deposits should be made regularly and money should not be kept on premises overnight.

Crime exposure for hospitals come from both employee dishonesty and money and securities. The potential for theft, directly or by means of identity theft, is great. Pre-employment checks, including criminal background checks, should be required for any employee with access to drugs or money. Inventory must be reviewed regularly and the drug areas must have limited access.

Regular monitoring with cameras can be helpful in deterring employee theft and monitoring patient treatment. All ordering, billing, and disbursements must be handled as separate duties. Regular inventories and audits must be conducted. Money and securities can be a concern if payments are accepted on premises. Deposits should be made regularly and no money kept on premises overnight. Patients' property may be stolen by employees.

Inland marine exposures for medical clinics include accounts receivable if the clinic bills for services, computers, physicians and surgeons equipment floater (which can include all office furnishings), and valuable papers and records for patients' and suppliers' information. Computers are used for patients' records and other office purposes, but most medical equipment, such as video equipment and X-ray machines, is also computerized.

Physicians and surgeons equipment includes items that doctors may take off site to handle emergencies. A medical clinic will generally include sophisticated computer and medical equipment, especially if it specializes in a particular medical field. Duplicates should be made of all records and stored off site.

Inland marine exposure for hospitals come from accounts receivable for billings, computers, medical equipment, and valuable papers and records for employees', patients' and vendors' information. Most medical equipment is now run by computers and should be covered on a computer form. Some medical equipment may be shared with other facilities or be kept in mobile care units, requiring separate coverage as it is transported between locations.

Equipment being transported must be adequately secured to prevent movement during transit. All records should be duplicated and a copy kept off premises. There may be a bailees exposure if the hospital takes custody of the goods of others, such as laundry. Some hospitals may have extensive fine arts and statuary that should be covered under a fine arts form.

Business auto exposure for medical clinics is generally limited to hired and non-owned liability for employees running errands. If there are owned vehicles, all drivers should be licensed with acceptable MVRs. Vehicle maintenance should be ongoing and documented in a central location.

Commercial auto exposure for hospitals is high because of the use of emergency vehicles and transportation of patients, officials, guests, and visitors because some may have an existing injury or have limited mobility. If there are owned vehicles, all drivers should be licensed with acceptable MVRs. Vehicle maintenance should be ongoing and documented in a central location. Ambulance drivers must be trained to notice surroundings, particularly when going through congested traffic and intersections. If the ambulance service is contracted out, the hospital should require certificates of insurance from each provider.

What Does Healthcare Facilities Insurance Cover & Pay For?

Healthcare facilities may face lawsuits for a variety of reasons, including medical malpractice, breach of contract, employment discrimination, and violations of patient privacy laws. The following are some examples of how insurance can help protect healthcare facilities from these types of lawsuits:

Medical malpractice: Medical malpractice occurs when a healthcare provider fails to provide the expected standard of care, resulting in harm to the patient. This can include misdiagnosis, surgical errors, medication errors, or negligence. Medical malpractice insurance can help healthcare facilities cover the costs of defending against a malpractice lawsuit and paying any damages awarded to the plaintiff.

Breach of contract: Healthcare facilities may enter into contracts with patients, vendors, or other parties that are later breached. This can include failure to provide agreed-upon services, breach of confidentiality agreements, or violation of non-compete clauses. Professional liability insurance can help cover the costs of defending against a breach of contract lawsuit and paying any damages awarded to the plaintiff.

Employment discrimination: Healthcare facilities may face lawsuits related to employment discrimination, such as claims of wrongful termination, sexual harassment, or age discrimination. Employment practices liability insurance can help cover the costs of defending against these types of lawsuits and paying any damages awarded to the plaintiff.

Violations of patient privacy laws: Healthcare facilities must comply with various laws and regulations related to patient privacy, including the Health Insurance Portability and Accountability Act (HIPAA). Violations of these laws can result in lawsuits and fines. Cyber liability insurance can help cover the costs of defending against a privacy lawsuit and paying any damages awarded to the plaintiff.

In general, insurance policies help healthcare facilities mitigate the financial risks associated with lawsuits by providing coverage for legal fees, court costs, and damages awarded to the plaintiff. It is important for healthcare facilities to carefully review their insurance policies to ensure that they have adequate coverage for the specific risks they face.

Commercial Insurance And Business Industry Classification

• SIC CODE: 8011 Offices and Clinics of Doctors of Medicine
• NAICS CODE: 621493 Freestanding Ambulatory Surgical and Emergency Centers
• Suggested Workers Compensation Code(s): 8833 Hospital - Professional Employees, 9040 Hospital - All Other Employees

Description for 8011: Offices and Clinics of Doctors of Medicine, 8062 General Medical and Surgical Hospitals, 8051 Nursing Homes - Skilled, 8052 Nursing Homes - Intermediate Care, 8059 Nursing and Personal Care Facilities, Not Elsewhere Classified

Division I: Services | Major Group 80: Health Services | Industry Group 801: Offices And Clinics Of Doctors Of Medicine

8011 Offices and Clinics of Doctors of Medicine: Establishments of licensed practitioners having the degree of M.D. and engaged in the practice of general or specialized medicine and surgery. Establishments operating as clinics of physicians are included in this industry.

• Ambulatory surgical centers
• Anesthesiologists, offices of
• Clinics of physicians (M.D.)
• Dermatologists, offices of
• Freestanding emergency medical (M.D.) centers
• Gynecologists, offices of
• Neurologists, offices of
• Obstetricians, offices of
• Oculists, offices of
• Ophthalmologists, offices of
• Orthopedic physicians, offices of
• Pathologists (M.D.), offices of
• Pediatricians, offices of
• Physicians (M.D.), including specialists: offices and clinics of
• Plastic surgeons, offices of
• Primary care medical (M.D.) clinics
• Psychiatrists, offices of
• Psychoanalysts, offices of
• Radiologists, offices of
• Surgeons (M.D.), offices of
• Urologists, offices of

8062: General Medical and Surgical Hospitals

Division I: Services | Major Group 80: Health Services | Industry Group 806: Hospitals

8062 General Medical and Surgical Hospitals: Establishments primarily engaged in providing general medical and surgical services and other hospital services. Specialty hospitals are classified in Industries 8063 and 8069.

• General medical and surgical hospitals

8051: Nursing Homes - Skilled

Division I: Services | Major Group 80: Health Services | Industry Group 805: Nursing And Personal Care Facilities

8051 Nursing Homes - Skilled: Establishments primarily engaged in providing inpatient nursing and rehabilitative services to patients who require continuous health care, but not hospital services. Care must be ordered by and under the direction of a physician. The staff must include a licensed nurse on duty continuously with a minimum of one full-time registered nurse on duty during each day shift. Included are establishments certified to deliver skilled nursing care under the Medicare and Medicaid programs.

• Convalescent homes with continuous nursing care
• Extended care facilities
• Mental retardation hospitals
• Nursing homes, skilled

8052: Nursing Homes - Intermediate Care

Division I: Services | Major Group 80: Health Services | Industry Group 805: Nursing And Personal Care Facilities

8052 Nursing Homes - Intermediate Care: Establishments primarily engaged in providing inpatient nursing and rehabilitative services, but not on a continuous basis. Staffing must include 24-hour per day personnel with a licensed nurse on duty full-time during each day shift. At least once a week, consultation from a registered nurse on the delivery of care is required. Included are facilities certified to deliver intermediate care under the Medicaid program.

• Intermediate care facilities
• Nursing homes, intermediate care

8059: Nursing Homes Nursing and Personal Care Facilities, Not Elsewhere Classified

Division I: Services | Major Group 80: Health Services | Industry Group 805: Nursing And Personal Care Facilities

8059 Nursing Homes Nursing and Personal Care Facilities, Not Elsewhere Classified: Establishments primarily engaged in providing some nursing and/or health-related care to patients who do not require the degree of care and treatment that a skilled or intermediate care facility is designed to provide. Patients in these facilities, because of their mental or physical condition, require some nursing care, including the administering of medications and treatments or the supervision of self-administered medications in accordance with a physician's orders. Establishments primarily engaged in providing day-to-day personal care without supervision of the delivery of health services prescribed by a physician are classified in Industry 8361.

• Convalescent homes for psychiatric patients, with health care
• Convalescent homes with health care
• Domiciliary care with health care
• Homes for the mentally retarded with health care, except skilled and
• Nursing homes except skilled and intermediate care facilities
• Personal care facilities with health care
• Personal care homes with health care
• Psychiatric patient's convalescent homes
• Rest homes with health care

Healthcare Facilities Insurance - The Bottom Line

In addition, think about reviewing your current healthcare facilities insurance coverage with your agent to make sure that the coverage you have is sufficient. In many cases, some of the policies you own may be outdated and need to be reviewed to ensure that the insurance you have no meets your current needs.

As a bonus, your agent can work with you to get separate quotes from multiple insurers, making sure you get the biggest bang for your facility's insurance budget, improving your facility's overall bottom line while keeping your insurance needs in the forefront and fully covered.

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.

• Ambulatory Surgical Center
• Art Therapy
• Assisted Living Facilities
• Audiology
• Blood Banks
• Dental Lab
• Dental Office
• Diagnostic Imaging Centers
• Health Maintenance Organizations
• Healthcare Facilities
• Home Medical Equipment Dealers
• Hospitals
• Hypnosis
• Malpractice
• Marriage & Family Therapy
• Medical Clinics
• Medical Laboratories
• Medical Marijuana Dispensary
• Medical Practice
• Medical, Surgical & Hospital Supply Store
• Mental Health Counseling
• Nurse
• Nurse Registry
• Occupational Therapy
• Ophthalmologist
• Optician
• Optometrist
• Osteopathic Physicians
• Otolaryngologists
• Physicians Office
• Plastic Surgeons
• Podiatrists
• Prosthetists
• Psychology
• Psychiatrists
• Skilled Nursing Facilities
• Speech Therapy
• Substance Abuse Counseling
• Surgeons
• Telemedicine Business Insurance
• Veterinarian
• Specialty Medical Centers And Clinics
• Specialty Medical Malpractice

The medical industry is a crucial sector that plays a vital role in ensuring the health and well-being of individuals. It is a complex and highly regulated industry that requires specialized knowledge and expertise. As a result, the medical industry is exposed to a variety of risks, including legal and financial liabilities.

One of the main reasons why the medical industry needs commercial insurance is to protect against medical malpractice. Medical malpractice occurs when a healthcare provider deviates from the standard of care and causes harm to a patient. It can lead to costly lawsuits and significant financial losses for the healthcare provider. Business insurance helps to cover these costs and protect the financial stability of the medical facility.

Another reason the medical industry needs business insurance is to cover the cost of regulatory fines and penalties. The medical industry is subject to strict regulations and any violations can result in significant fines and penalties. Business insurance helps to cover these costs and protect the financial stability of the medical practice or facility.

In addition, the medical industry is vulnerable to data breaches and cyber attacks. These incidents can result in significant financial losses and reputational damage for the medical facility. Business insurance helps to cover the cost of recovering from a data breach or cyber attack and helps to protect the reputation of the medical facility or practice.

Overall, business malpractice insurance is an essential component of the medical industry. It helps to protect against the financial and reputational risks associated with the medical industry and helps to ensure the financial stability and success of medical practices and facilities.

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.