By 2020, the healthcare industry is projected to add over 4.2 million jobs.1 As a result, many retail brokers and agents are targeting this booming segment to grow their book of business. However, if a broker is unfamiliar with working on Medical Insurance policies they may overlook a coverage exposure that could result in a costly error.
“Experience is crucial in regards to Medical Malpractice insurance, often making the difference whether a claim is accepted or denied” says Nicole Greene, Director of Brokerage, Professional and Executive Liability Center of Excellence, Burns & Wilcox.
Medical liability policies address bodily injuries that result from a medical professional’s negligence arising during or as a result of the treatment of care provided to a patient. In 2016, payouts from Medical Malpractice lawsuits hit $3.95 billion in the United States alone.2
Insurance Market Source connected with Greene and Greg Wideman, Senior Broker, Professional and Executive Liability Center of Excellence, Burns & Wilcox, for trends, tips, and insight on this growing segment.
Trends in How Medical Care has Changed
“For doctors in the 1970s and 1980s it was trendy to have your own practice,” said Greene. “Today, as younger generations are coming into the industry, a large majority of doctors are opting to work for a healthcare system rather than owning their own practice. They value a balanced quality of life above having the opportunity to run a business and balance medical duties.”
Greene added “This, coupled with a complex reimbursement system for services rendered and an increased population of aging baby boomers have directly played into the shortage of healthcare professionals.”
A large amount of mergers and acquisitions continue to occur in healthcare, with many seasoned doctors looking for an exit strategy from their independent businesses. As quickly as jobs are increasing in this space, experts are noting there will be a shortfall of more than 90,000 doctors by 2025.3
“The shortage of doctors is already starting to cause more nurses and physicians assistants to assume responsibilities that doctors should possess,” said Wideman. “Giving up certain responsibility is resulting in increased Medical Malpractice lawsuits for these mid-level professionals from errors in care.”
Insights on Medical Malpractice Claims
One positive change in recent years is the move to online medical records. Greene stated that although medical professionals’ responsibilities have been stretched in recent years, the move to online medical records – along with the infusion of preventative care – have both aided in the decrease in Medical Malpractice claims. Having the ability to review a patient’s full medical history online prior to rendering a course of treatment has aided in curbing Medical Malpractice.
In fact, researchers at Harvard Medical School recently conducted a study of physicians, noting that 33 of the 275 doctors surveyed were involved in 51 Medical Malpractice claims. Forty-nine of those claims were related to events occurring before the adoption of online medical records. Only two claims were made after adoption.4
Tips for Targeting a Growing Segment
For brokers and agents targeting medical professionals to grow their book of business, Greene and Wideman suggest the following tips:
- Network at physician associations, meetings, and events. This helps with word of mouth advertising, and once doctors start talking to each other it produces a lot of referrals.
- Look deep in the current book of business. Many brokers have opportunities for potential upsells internally. There has been a huge shift in staffing risk. Traditionally, staffing firms focused on information technology and licensed professionals. Now, many larger firms have a blend of non-licensed and licensed professionals in conjunction with healthcare professionals. When a staffing risk comes in the door, ask if they place any healthcare professionals. The largest class currently is home healthcare staffing.
- Re-evaluate transportation accounts. If a broker has a transportation book of business, it is likely there is a healthcare risk. Ask clients who specifically they are transporting. For example, if the client transports elderly people to doctors appointments, it is classified as a non-emergency healthcare risk. If the client was loading the patient into a vehicle and disrupted a dialysis port it would not be picked up under a normal policy, and a Medical Malpractice policy would be needed.
- Get educated. Seek out online webinars and in-person seminars and learn as much as possible about the space. Brokers and agents should specifically take the time to learn how the policy responds, especially in certain states. Become familiar with the numerous classification codes used to describe the various healthcare class of business.
- Partner with a wholesaler. Brokers should consider seeking out and partnering with trained professionals in the healthcare wholesale insurance space.
When it comes to Medical Malpractice insurance, finding ways to continually learn about the space and levels of risk will benefit even the most knowledgeable brokers and agents.