A humane alternative: protect hospice care: the growth of hospice care in the u.s. has created a need for a different kind of medical malpractice coverage. Find out how agents can advise their hospice clients in this growing field.
Hospice offers compassionate care for terminally ill patients, providing services that separate it from other healthcare organizations. Reimbursement, outcomes, medication management issues, ethical questions and the relationship with patients and families are different that traditional healthcare solutions.
Medical malpractice insurance also is different. When writing this essential coverage for hospice, consider that emotions often complicate communications between families and caregivers, leading to more frequent allegations of malpractice and greater severity of malpractice claims.
This is no small concern, as this industry has grown rapidly since its start just 40 years ago. The first hospices in the U.S. were opened in the mid-1970s by nurses who were inspired by the work of Dame Cicely Saunders. She effectively founded the hospice movement in 1967 with the opening of St. Christopher's Hospice in London.
The National Hospice and Palliative Care Organization (NHPCO) estimates that 1.58 million people received hospice care in 2010, growing from 1.3 million who received hospice care in 2006. NHPCO also estimates that in 2010, 41.9 percent of all deaths in the U.S. were under the care of a hospice program.
There were 5,150 hospice organizations in operation in 2010, up from 4,500 in 2006, with reimbursement to hospices under the hospice Medicare benefit now exceeding $10 billion per year.
Today, the most severe liability claims against hospice arise from errors in medication administration and documentation, and from patient accidents caused by wandering and smoking. The most frequent claims are caused by employees and volunteers when they are driving personal vehicles while performing duties for hospice.
CHANGING ROLE OF THE MEDICAL DIRECTOR
Along with the growth of hospice care over the years have come changes in the role of medical directors and other physicians in today's hospice care team--changes that require that liability coverage be structured in specific ways that differ from coverage needed by other healthcare organizations.
The interdisciplinary team, while not unique to hospice, is used effectively in the hospice setting. Each patient's team includes nurses, social workers, clergy, nutritionists and therapists who meet regularly to create, document and, if necessary, change a plan of care.
The leader of the interdisciplinary team is a physician who signs off on the plan of care and acts as a consultant to the other members of the team. Traditionally, the physician has been a medical director, paid or volunteer, who works part time advising the team, setting protocols and signing off when a physician's signature is necessary. That role is changing.
Today, many hospices have a medical director who leads a team of physicians who are contracted or employed on a full-time basis. In addition to the administrative role of the traditional medical director, these physicians can be hands on with patients.
When patients are referred to hospice, family physicians often withdraw from the patient and a hospice team physician becomes the attending physician, visiting patients and sometimes performing procedures to relieve pain and manage symptoms.
The Centers for Medicare and Medicaid Services (CMS) in 2011 changed the rules related to hospice patient certification, requiring recertification after 180 days and examination by the hospice physician in a face-to-face encounter. The physician must certify that the patient is terminally ill and in need of hospice care. Previously the medical director could perform this without seeing the patient.
COVERING CLINICAL AND ADMINISTRATIVE DUTIES
Because physicians have more hands-on clinical responsibilities in hospice than ever before, it's no longer good enough to provide a low level of malpractice coverage for the hospice entity and add an endorsement to cover the administrative duties of the medical director.
Agents and brokers should include both professional and general liability coverage in the same policy, but at a minimum write both with the same insurance company so there are no disputes over which coverage applies to a particular incident. Occurrence coverage is available for hospice and claims-made coverage works well, as long as agents pay attention to retroactive dates and extended reporting periods when changing carriers.
One of the most important points to consider is that medical malpractice coverage for physicians must be provided for clinical duties as well as administrative duties. First, while some of the physicians who work for hospice have their own practices and their own malpractice coverage, insurance agents have no way of knowing whether the policy covering the physician's practice excludes coverage for hospice work. Also, many hospice physicians are employed by the hospice and have no coverage other than what their employer can provide.
Many professional and general liability policies for hospices specifically exclude physicians, and many others include limited medical director coverage for administrative duties only. Such coverage is not sufficient because there can only be one medical director, and many hospices have 10 or 20 or more physicians contracted or employed. The limitation of coverage to administrative duties leaves physicians bare for the many clinical duties they perform.
If physicians are excluded, some insurance company underwriters may be willing to add them by endorsement for an additional premium. That can work as long as the coverage is not limited to administrative duties only. The best option is to find blanket coverage for physicians, either built into the policy or as a blanket endorsement. That way it is less likely a physician will be missed because of a clerical error at the hospice or the insurance agency.
Most hospice professional and general liability policies have physicians share the policy's limits with the entity and all other additional insureds. This option works well if the limits are high enough. If physicians want their own individual policy limits and they have enough clout with the hospice to insist, the only option is to purchase a separate physician malpractice policy. That will likely be much more expensive and create the need to exclude physicians from the hospice's policy while keeping vicarious liability for the hospice to cover their liability for the acts of the physicians while the physicians are performing administrative and clinical duties on behalf of the hospice.
Finally, there is the issue of physicians coming and going. Some physicians retire from hospice and others leave to continue their careers somewhere else. Because much of the hospice liability coverage in-force is on a claims-made basis, there needs to be some extended reporting provision for physicians who leave.
One option is to provide an individual extended reporting period to each physician when he or she leaves the hospice. A better option is to negotiate an endorsement with the insurance company that continues coverage on a blanket basis for all physicians who leave as long as the entity continues to be covered by that insurance company.
SELLING COVERAGE OVER PRICE
Coverage is more difficult to sell than price. That has been particularly true in recent years when underwriters have had so much excess capacity and clients have had reduced revenue. Hospice revenue continues to be under pressure because of competition, cuts in Medicare hospice benefits and government audits of their billings to Medicare. When auditors find a billing error, reimbursement can be held up for extended periods of time.
Reduced revenue makes hospice administrators even more cost conscious than they already are inclined to be, and insurance is one of their big cost drivers. Insurance agents, serving more as advisors than order takers, have to push back when hospice administrators want to cut costs at the expense of coverage. Hospices have a big, noble mission to provide people who have life-limiting illness with the best that mankind has to offer. We owe it to them to sell them on purchasing the best coverage our industry has to offer.
Often the quality of the coverage you can get for your hospice clients depends on the quality of your submission to the insurance company or program manager. If you fill out one company's application and only answer half of the questions and then send the same application to several companies, you won't get a very good proposal from any of them. Because different insurance companies use different exposure bases to rate hospice liability coverage, you need to make a complete submission to each insurance company using that company's specific application. The most accurate measure of hospice liability exposure is patient days, which measures the number of patients multiplied by each patient's number of days in hospice care. Hospices are reimbursed by Medicare on a per-diem basis for each patient. Because it is the biggest source of their revenue, hospices have very accurate records regarding patient days.
If we are going to be advisors and sell our hospice clients the quality coverage they deserve, we need to make the effort to provide each company or program manager who is going to make a proposal with the information they need to give us the best proposal they can offer.
ADDITIONAL INSUREDS and PROFESSIONAL SERVICES
Agents who insure hospices should give attention to the "who is insured" clauses and the definitions of "insured" in hospice policies. These clauses should include employees, volunteers and independent contractors who perform various professional duties on behalf of the hospice as additional insureds. Therapists, for example, are often independent contractors rather than employees. The same is true of some of the physicians who work for hospice.
The definition of professional services is another policy area that requires attention because it is a core element of malpractice coverage. is the definition broad enough to include providing medical or nursing services to any person including the furnishing of food or beverage services in connection therewith? Does it include providing mental health services including social workers, grief or bereavement counselors, pastoral counselors and similar services? How about providing professional services of therapists and psychologists?
does the definition of professional services in the hospice liability policy include furnishing or dispensing of drugs or medical, surgical or dental supplies or appliances? does it include the handling or treatment of dead bodies, including autopsies or organ donations or other procedures? does it cover serving on or carrying out the orders of a healthcare accreditation board or similar professional board, or establishing medical protocol, creating medical training curricula, providing medical training or conducting medical quality assurance programs?
These are all things that hospices and the professionals who work on their behalf do in the course of providing hospice services to patients and their families.
More on the Web:
* Nonprofit/Charitable Organizations: Big Business, Big Risks
* As Social-Service Groups Look For Alternative Revenue Streams, Insurance Risks Grow
*PIAA President: Changes in Procedures Helping Medical-Liability Industry to Improve
Read these related articles at PropertyCasualty360.com
Bruce Williams, CPCu, CLu, is president of Glatfelter healthcare practice part of Glatfelter program Managers, a strategic business unit dedicated to Glatfelter
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|Title Annotation:||MEDICAL MALPRACTICE|
|Publication:||American Agent & Broker|
|Article Type:||Cover story|
|Date:||Jul 1, 2012|
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