Healthcare professionals and facilities operate with significant risks, particularly during a pandemic. To learn more about evolving coverage needs and available options in Healthcare/Medical Facilities Insurance, we spoke with Karl Olson, Vice President, Professional & Management Liability Practice Leader, Burns & Wilcox Brokerage, San Francisco, California.
What are the greatest risks currently faced by healthcare systems and providers?
K.O.: The healthcare risk landscape changes by the week and almost by the day, so uncertainty is probably the most accurate byword to describe it. Some of the current risks are patient safety, medical practitioner safety and delayed or suspended access to elective procedures. Between March and July 2020, the Centers for Medicare & Medicaid Services estimated that 21 percent of Medicare beneficiaries delayed receiving care. Meanwhile, the long-term care community represents less than 1 percent of the U.S. population but 38 percent of U.S. COVID-19 deaths. In addition, the business of providing healthcare is uncertain due to the financial impact of COVID-19 and other unknowns, such as a change in U.S. presidential administrations.
What should health care professionals and facilities be aware of relative to these risks?
K.O.: Operationally, following guidance from the Centers for Disease Control and Prevention is important, as is adjusting the delivery of health care services by implementing telehealth and stay-at-home outpatient care. COVID-19 forced 10 years of healthcare services delivery development into six months of implementation. With regard to insurance placements, healthcare providers need to start the renewal process early. Underwriting philosophies are firming for many lines of coverage, which can result in increased premiums, lower limits, higher retentions and constricted terms and conditions. Because we address these changes by responsibly canvassing the marketplace, every account has more activity. This, in turn, means that every viable carrier has an exponential increase in underwriting submissions.
What insurance policies can help healthcare providers respond to the threats they face?
K.O.: Professional Liability is essential to provide adequate coverage for medical malpractice and negligence. Each type of health care provider has unique risks. Professional Liability (PL) and Commercial General Liability (CGL) are written to address the scope of risk. While PL and CGL are broadly written categories, Miscellaneous Medical Insurance can help cover secondary or ancillary medical providers such as telehealth services, labs, testing facilities, consultants and pharmacies. Other important policies include Directors & Officers (D&O) and Employment Practices Liability (EPL) focused on health care, Regulatory Cover, and Cyber Liability.
How has COVID-19 affected the Healthcare/Medical Facilities Insurance market?
K.O.: We are seeing additional scrutiny of submissions; we need to generate a narrative beyond what is on an application. We have to take the mentality of addressing how COVID-19 has impacted clients’ operations when crafting an efficient summary of 2020. There is also reduced capacity, meaning that carriers have exited or narrowed what risks may be considered.
What steps should health care professionals and facilities take to complement their insurance coverage from a prevention standpoint?
K.O.: In many cases, facility directors have restructured the policies and procedures for their operations to address the COVID-19 environment. They should make sure employees are well-versed in these best practices. Facility administrators have the constantly-evolving task of procuring PPE, managing undue pressure on finances and allocating vaccines—transparency in these activities is paramount.
What advice would you give brokers to increase their success in the Healthcare/Medical Facilities market?
K.O.: Listen with empathy and understanding of the influences on each client’s business. Be thorough. It is imperative that interactions with markets, underwriters and clients are efficient and complete. It is much easier to customize coverage when an application, financials and loss history convey an adequate explanation of risk exposures.
What features of Healthcare/Medical Facilities Insurance are specific to Burns & Wilcox?
K.O.: We have a Proprietary Regulatory Program for billing audits and investigations. These investigations are meant to ferret out fraud and abuse of payments sought from Medicare, Medicaid or commercial payors. We also have a Healthcare Specialty Program specifically for home health care providers.
Healthcare/Medical Facilities Insurance
WHY YOUR CLIENTS MIGHT NEED IT: The COVID-19 pandemic has resulted in layoffs, staffing shortages and cancellations of elective surgical procedures, adding to already rising medical liability costs at a time when 34 percent of physicians are sued at some point in their careers. Cyberattacks are more frequent than ever and healthcare entities expect a wave of lawsuits related to the pandemic as well as the corresponding rise in telemedicine.
PROTECTS AGAINST: Limits exposure to financial risks caused by cybersecurity breaches and allegations of errors, omissions and negligent acts arising from practicing medicine or operating a healthcare facility.
EXPERT OPINION: “Between March and July 2020, the Centers for Medicare & Medicaid Services estimated that 21 percent of Medicare beneficiaries delayed receiving care. Meanwhile, the long-term care community represents less than 1 percent of the U.S. population but 38 percent of U.S. COVID-19 deaths,” said Karl Olson, Professional Management Liability Practice Leader, Burns & Wilcox Brokerage, San Francisco, California.