Medical Practice Insurance Policy Information
Medical Practice Insurance. Many medical and healthcare practices have business owner's (BOP) policies. This type of policy protects the business or the facility in many of the same ways that homeowner's insurance coverage protects the home and its contents.
If your medical practice does not have a BOP policy in place, now is the time to consider one.
A medical practice insurance business owner's policy can provide you with protection if you find yourself on the receiving end of a lawsuit.
Medical practice insurance protects your practice from lawsuits with rates as low as $57/mo. Get a fast quote and your certificate of insurance now.
Below are some answers to commonly asked medical practice insurance questions:
- What Is Medical Practice Insurance?
- How Much Does Medical Practice Insurance Cost?
- Why Do Medical Practices Need Insurance?
- What Type Of Insurance Do Medical Practices Need?
- What Are Medical Practices Risks & Exposures?
- What Does Medical Practice Insurance Cover & Pay For?
What Is Medical Practice Insurance?
Medical practice insurance is a type of insurance coverage designed specifically for healthcare providers, including physicians, nurses, chiropractors, and other medical professionals. This insurance provides financial protection for the healthcare provider in the event of a lawsuit related to their medical practice.
It covers expenses such as legal fees, settlements, and judgments that may result from allegations of medical malpractice, errors, or omissions. Medical practice insurance also helps to protect the provider's personal assets and helps to minimize financial loss in the event of a lawsuit.
How Much Does Medical Practice Insurance Cost?
The average price of a standard $1,000,000/$2,000,000 General Liability Insurance policy for small medical practices ranges from $27 to $59 per month based on location, services offered, payroll, sales and experience.
Why Do Medical Practices Need Insurance?
Here's some reasons why medical practices need insurance.
Risk Management: Medical practices face numerous risks, including malpractice lawsuits, liability claims, and loss of equipment or property. Insurance protects against these risks and helps manage the financial impact of unexpected events.
Compliance: Medical practices are required to comply with various regulations, such as HIPAA, and insurance can help ensure that they meet these standards.
Financial Stability: Insurance provides financial stability to medical practices by covering the costs of unexpected expenses, such as legal fees and settlements.
Employee Protection: Medical practices often employ many people, and insurance can protect employees from financial loss in the event of injury, illness, or disability.
Patient Confidence: By having insurance, medical practices can demonstrate their commitment to patient safety and financial stability. This can increase patient confidence in the practice and encourage more people to seek care.
In summary, insurance is crucial for medical practices as it provides protection against financial and legal risks, helps maintain compliance with regulations, and enhances patient confidence.
What Type Of Insurance Do Medical Practices Need?
This medical practice insurance is a policy that is crucial to most small businesses, especially healthcare-related businesses. A BOP policy can help your practice save money on your overall insurance costs while also protecting the practice that you've worked hard to establish.
By bundling the coverage types available in a BOP policy, you can save a substantial amount on your insurance needs.
A BOP policy generally affords three types of coverage, including:
- Business liability insurance. Business liability policies protect medical and healthcare practices from potential lawsuits from patients and others. This includes lawsuits where the plaintiffs allege property damage or physical injury that results from the operation on your business. For example, if you operate a healthcare facility, and a patient falls or becomes injured inside your facility, then this insurance can kick in and pay. This medical practice insurance policy also covers claims of libel and slander in some instances. This type of policy should not be mistaken for a liability policy covering any malpractice liability. This is a different policy altogether.
- Business property insurance. This insurance covers the actual property where your facility is located. It protects your business and the tools you use to conduct it, including any therapy tools, computer equipment, furnishings, and medical equipment.
- Business income insurance. If your business is forced to close due to some sort of unforeseeable yet covered event, then the income you lose during the interim is covered under a business income insurance policy. For example, if your business shuts down after a hurricane blows through town, you can be reimbursed for lost income while repairs are being made to your facility.
Although a BOP policy for medical practices is a good start to covering your insurance needs, there are other insurance types that you should consider to fully protect your business. Many medical clinics go for:
- Accounts receivable coverage. Working with an insurance company oftentimes means waiting for reimbursement for many medical providers. Because receivable income makes up a high percentage of your practice's total assets, if your accounts receivable records become destroyed during a covered event, it can be catastrophic. With accounts receivable policies, you can be reimbursed for costs incurred in replacing these valuable payment records.
- Off-premises utility services coverage, or OPUS. OPUS coverage is an essential for medical practices, since they depend on power and on communication services in order to operate. With an OPUS policy, your business is covered from loss of income that results from utility services interruptions. For example, if a storm causes downed power lines, and your business suffers as a result, you can be compensated.
- Interruption of practice coverage. If an electrical service disruption or other utility disruption causes your business to be unable to open, then this type of coverage provides up to 12 months of lost income for your business while repairs are underway. In some instances, you can elect to be paid a particular amount for the first 15 days of outage.
- Data breach coverage. You've seen plenty of press in the past few years about data breaches and how many people they can affect. With data breach coverage, you protect your medical practice from liability if a data breach occurs.
- Legal expenses insurance. If a patient of yours makes a complaint against a state review board, this coverage kicks in to pay for legal expenses to defend you in front of the board or in court. This can be valuable medical practice insurance coverage if the unexpected happens.
In addition to these insurance types, you should also consider bundling worker's compensation and commercial auto insurance along with your BOP policy for medical practices. These coverages prove invaluable if a worker is hurt or becomes ill due to a work-related cause.
If you have vehicles that you use in your business activities, it's important to carry commercial auto insurance to cover these vehicles, since most personal policies will not pay for accidents and resulting claims when the vehicle is used for work.
What Are Medical Practices Risks & Exposures
Premises liability exposure is moderate due to patients' access to the premises. To prevent slips, trips, or 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 with spills 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 the 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.
Malpractice / Professional exposures are extensive. The exposure increases if the provider fails to conduct thorough background checks to verify employees' credentials, education, and licensing. The more types of procedures that the doctor performs, the more chance of professional loss. A patient's medical history must be checked prior to prescribing medications. 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.
Workers compensation exposure is due to the possible transmission of disease from a patient. Gloves and masks should be worn at all times when working around bodily fluids. Employees should have access to vaccinations to prevent diseases. Unruly or unpredictable patients can cause harm including strains, back injuries, and contusions. 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. If employees travel to patients' residences there should be monitoring procedures in place that include emergency backup.
Property exposure is moderate 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. 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 doctor has arranged for temporary facilities with another doctor.
Equipment breakdown exposures may be high if operations are dependent on expensive medical equipment being available on the premises, particularly if the doctor specializes in a particular field. All equipment should be maintained on an ongoing basis.
Crime exposure is from employee dishonesty of both money and inventory, including pharmaceuticals. The potential for theft, directly or by means of identity theft, is great. Background checks should be conducted on all employees handling money. Rigid controls must be maintained including inventory control and limited access to storage areas. All ordering, billing, and disbursement must be handled by separate individuals. 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.
Inland marine exposure includes accounts receivable if the physician 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 some medical equipment, such as video equipment and X-ray machines, is now also computerized. Physicians and surgeons floater includes items that the doctor may take off site to handle emergencies. Duplicates of all records and programs should be kept off site.
Business auto exposure 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. Vehicles must be maintained and records kept in a central location.
What Does Medical Practice Insurance Cover & Pay For?
Medical practices can be sued for a variety of reasons, including:
- Medical malpractice: This occurs when a healthcare professional, such as a doctor or nurse, fails to provide a reasonable standard of care, resulting in harm to the patient.
- Breach of confidentiality: This occurs when a healthcare professional discloses a patient's private medical information without the patient's consent.
- Failure to diagnose: This occurs when a healthcare professional fails to diagnose a patient's condition in a timely and accurate manner, resulting in harm to the patient.
- Improper treatment: This occurs when a healthcare professional administers treatment that is not appropriate for the patient's condition, resulting in harm to the patient.
- Negligence: This occurs when a healthcare professional fails to exercise reasonable care, resulting in harm to the patient.
Insurance can protect medical practices from the financial costs associated with lawsuits. For example:
Medical malpractice insurance: This type of insurance protects healthcare professionals from claims of medical malpractice. It covers the cost of legal fees, settlements, and judgments associated with such claims. If a doctor is sued for medical malpractice, their insurance provider will pay for their defense and any settlement or judgment that may be awarded to the plaintiff.
Cyber liability insurance: This type of insurance protects medical practices from claims of breach of confidentiality. It covers the cost of legal fees and settlements associated with such claims. If a healthcare professional is sued for disclosing a patient's private medical information, their insurance provider will pay for their defense and any settlement that may be awarded to the plaintiff.
Errors and omissions insurance: This type of insurance protects medical practices from claims of negligence, failure to diagnose, and improper treatment. It covers the cost of legal fees, settlements, and judgments associated with such claims. If a healthcare professional is sued for negligence or other related claims, their insurance provider will pay for their defense and any settlement or judgment that may be awarded to the plaintiff.
In summary, insurance can help medical practices pay for lawsuits by covering the costs of legal fees, settlements, and judgments associated with various types of claims. This protection can provide peace of mind to healthcare professionals and allow them to focus on providing quality care to their patients.
Commercial Insurance And Business Industry Classification
- SIC CODE: 8011 Offices and Clinics of Doctors of Medicine, 8031 Offices and Clinics of Doctors of Osteopathy
- NAICS CODE: 621111 Offices of Physicians (except Mental Health Specialists)
- Suggested Workers Compensation Code(s): 8832 Physician & Clerical
Description for 8011: Offices and Clinics of Doctors of Medicine
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
Description for 8031: Offices and Clinics of Doctors of Osteopathy
Division I: Services | Major Group 80: Health Services | Industry Group 803: Offices And Clinics Of Doctors Of Osteopathy
8031 Offices and Clinics of Doctors of Osteopathy: Establishments of licensed practitioners having the degree of D.O. and engaged in the practice of general or specialized osteopathic medicine and surgery. Establishments operating as clinics of osteopathic physicians are included in this industry.
- Osteopathic physicians, offices and clinics of
Medical Practice Insurance - The Bottom Line
Discussing your particular situation with your licensed agent is the best way to find the right business owner's policy for your medical practice. Your agent can help you compare rates with multiple insurers to find the best possible rate for you and your budget. Your agent can also help you find the right level and policy limits to ensure that your medical practice is covered from a 360-degree angle.
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
- Blood Banks
- Dental Lab
- Dental Office
- Diagnostic Imaging Centers
- Health Maintenance Organizations
- Healthcare Facilities
- Home Medical Equipment Dealers
- Marriage & Family Therapy
- Medical Clinics
- Medical Laboratories
- Medical Marijuana Dispensary
- Medical Practice
- Medical, Surgical & Hospital Supply Store
- Mental Health Counseling
- Nurse Registry
- Occupational Therapy
- Osteopathic Physicians
- Physicians Office
- Plastic Surgeons
- Skilled Nursing Facilities
- Speech Therapy
- Substance Abuse Counseling
- Telemedicine Business Insurance
- 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.