Page 10 - COM Outlook - Winter 2013

10 COM Outlook . Winter 2013
HEALTH CARE LEGAL EAGLE
Malpractice Insurance in Employment Contracts:
Don’t Pay to Chase Your Tail
By Fred Segal, Esq.
Health Law Attorney, Broad and Cassel
If employed, the malpractice coverage most
likely will be taken care of by the employer,
which is a valuable benefit. However, carefully
research the responsible party for payment of
tail coverage.
Tail coverage includes events that cause liabil-
ity while the policy is still active but are reported
to the insurance company after the policy is
terminated. For example, consider a physician
who treats a patient while employed by a certain
medical group. After the physician leaves the
practice, the patient sues for malpractice. A tail
policy will cover the physician for that incident.
Tail coverage comes with a price, and it’s not
cheap. Some employment contracts specifically
provide that the employer will pay for the physi-
cian’s tail coverage. Other contacts specify that
the physician will pay for it. In still other situa-
tions, contracts stipulate that the employer and
the physician will split the coverage. Some con-
tracts, however, do not address this issue at all.
Whether you will
be responsible for
tail coverage in your
malpractice policy is an
important issue that can-
not be overlooked. First,
if there is a malprac-
tice provision in your
contract, you must make
sure that tail coverage
is addressed. Many
employers will try to
avoid having to pay tail
coverage for you upon
your termination with
the group. For example,
one common employer
tactic is to leave the pro-
vision out of the contract
altogether and argue upon termination that it is
not responsible for the tail coverage.
If a contract provision refers to tail cover-
age, read it carefully to understand who is
responsible for payment. Some groups consider
payment of the physician’s policy only dur-
ing employment a fair policy and believe the
physician should be responsible for paying for
tail coverage. The tail coverage, unfortunately,
often costs more than the physician’s coverage
during employment.
No simple resolution to this issue exists.
Whether a physician is responsible for tail
coverage depends on negotiations with the
employer, so be very careful. All too often, new
physicians don’t even think about this issue
until it comes back to bite them after employ-
ment is terminated. Keep this important issue
in mind during negotiations with your future
employer. Remember—you don’t want to be
caught chasing your tail.
Based on my experi-
ences advising young
physicians, one of the
most stressful parts of
practicing medicine is
worrying about becom-
ing a defendant in a mal-
practice lawsuit. Some
lawsuits can be avoided
by practicing good
medicine; others cannot
be avoided at all. There-
fore, a young physician
is not likely to procure
an insurance policy for
protection in case of a
malpractice lawsuit.
Fred Segal is an attorney in the
Miami office of the statewide law
firm Broad and Cassel, where he
is a member of the Health Law
Practice Group. After earning
a bachelor’s degree from the
University of Florida, he earned
his Juris Doctorate from NSU’s
Shepard Broad Law Center and
then completed a Master of Law
degree in Health Law at Widener
University School of Law in
Wilmington, Delaware, in 2008.