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Chelle Law
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        • Red Flags in a Dentist Employment Contract | Dental Employment Agreement Concerns
        • What Should a Dentist put in a Termination Letter? | Dental Contract
      • Dental Malpractice Insurance
        • Claims Made Insurance for a Dental Associate Explained | Same as Occurrence Claim for Dentists?
        • How Much Does Tail Insurance Cost for a Dentist?
        • Occurrence Based Insurance for a Dental Associate Explained | Different From Claims Made for Dentists
        • Dental Claims Made or Occurrence Insurance? (Professional Liability)
        • What is Tail Insurance for a Dentist? |  Malpractice Insurance for Dentists
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      • Nurse Practitioner Malpractice Insurance
        • Claims Made Insurance for a Nurse Practitioner Explained
        • How Much Does Tail Insurance Cost for a Nurse Practitioner?
        • Occurrence Based Insurance for a Nurse Practitioner Explained
        • Should a Nurse Practitioner Choose Claims Made or Occurrence?
        • Tail Insurance for a Nurse Practitioner Explained
      • Nurse Practitioner Non Compete Clauses
        • How Many Locations Should a Nurse Practitioner Non Compete Apply To?
        • Nurse Practitioner Non-Competes (ENFORCEABLE?)
        • Is a 2 Year Non Compete for a Nurse Practitioner Reasonable? | NP Non Compete
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        • Nurse Practitioner Non Compete vs Non Solicit
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          • ECFMG Certification Requirements | Certification Requirement
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      • Medical Malpractice Insurance
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        • Tail Insurance Cost for a Physician (Malpractice Insurance Cost)
        • 3 Ways a Physician Can Get Out of Paying for Tail Insurance | Medical Liability
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        • Is 10 Miles a Reasonable Restriction in a Physician Non-Compete?
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        • Is a Non-Compete Enforceable Against a Physician? | Physician Non-Compete
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        • Hospital Sign on Bonus Pay Back | Repay a Bonus When Doctor Leaves?
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        • Is a W2 or 1099 Better for a Physician? | Physicians Contract
        • What is a 1099 Physician?
        • What Percentage of Physicians are Self-Employed?
    • Physician Assistant Contract Attorney
      • Physician Assistant Employment Contracts
        • Can a Physician Assistant Break Their Contract?
        • How To Negotiate a PA Contract (Better Salary TIPS)
        • Red Flags in a Physician Assistant Employment Contract?
        • How Are PAs Compensated? (2 BEST Ways To Get PAID)
        • What Should Go Into a Physician Assistant Termination Letter?
      • Physician Assistant Malpractice Insurance
        • How Much Does Tail Insurance Cost for a Physician Assistant? | Malpractice Insurance
        • Physician Assistant Malpractice Insurance (Do You NEED Claims Made?)
        • Tail Insurance for a Physician Assistant Explained
        • What is Claims Made Insurance for a Physician Assistant?
        • Occurrence Based Insurance for a PA (Malpractice Basics)
      • Physician Assistant Non Compete Clauses
        • How Many Locations Should a Physician Assistant Non Compete Apply To?
        • Is 10 Miles a Reasonable Non Compete for a Physician Assistant?
        • Is a 2 Year Non Compete for a Physician Assistant Reasonable?
        • Is a Non Compete Enforceable Against a Physician Assistant?
        • Physician Assistant Non Compete vs Non Solicit | Compete vs Solicitation
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        • Physician Assistant Sign-On Bonus (Will You Have to Give it BACK?)
        • How Much Paid Time Off Should a Physician Assistant Get?
        • Should a Physician Assistant be Reimbursed for Moving Expenses?
        • What Benefits Should Go In a Physician Assistant Offer Letter?
        • What Physician Assistant Expenses Should an Employer Pay For?
      • Physician Assistant Independent Contractor Agreements
        • Can a Physician Assistant be Self Employed?
        • Is a W2 or 1099 Better for a Physician Assistant?
        • Physician Assistant Independent Contractor Tax Deductions
        • Physician Assistant Independent Contractor vs Employee
        • What is a 1099 Physician Assistant?
    • Veterinarian Contract Attorney
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        • What is AVMA Excess Limit Coverage?
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        • What is Occurrence Insurance for a Veterinarian?
        • What is the AVMA PLIT?
        • Veterinary Malpractice Insurance (Do Vets NEED Tail Coverage?)
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        • How Many Locations Should a Veterinary Non Compete Apply To?
        • Is a Non Compete Enforceable Against a Veterinarian (ETHICAL?)
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        • How Much PTO Should a Veterinary Associate Get?
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Occurrence Based Insurance for a PA (Malpractice Basics)

What is occurrence-based insurance for a physician assistant?  If you’re a PA and you’re working for an employer, maybe a physician-owned private practice, or maybe a small corporate-owned practice, you’re going to have two types of PA malpractice insurance. There’ll be a claims-made policy or an occurrence-based policy. Under a claims-made policy, a policy has to be in effect when the claim is actually made. It’s possible that when you leave an employer, you could get sued after the fact. So, you would need what’s called a tail policy that covers the gap between the last date that you saw a patient for the employer, and then the last day that somebody can sue you.

That’s called a statute of limitations and in most states, it’s two years. If you had a claims-made policy, you do need to purchase tail insurance. Now, this blog is about occurrence-based policy and an occurrence-based policy simply means a policy has to be in effect when the malpractice actually occurs. If you have an occurrence-based policy, you do not tail insurance, you are covered indefinitely. Whether the employer offers claims made or an occurrence-based policy is going to be up to the employer. They generally are not going to give the option of one or the other to the PA. They’re going to say, this is the coverage we offer. Several things to think about: an occurrence-based policy is around one-third more expensive per year than a claims-made policy.

Whereas with the claims made policy, as I said before, you must purchase tail insurance and tail cost is usually about twice what your annual premium is. The annual premium is simply how much it costs to insure you on a yearly basis. Most employers will use claims-made insurance because it’s a third less. And then they’ll also shift the responsibility to pay for tail insurance onto the PA. So, they not only pay less per year, but then they don’t pay that big chunk in the end either. If the employer offers an occurrence-based and they’re paying for it, it’s a no-brainer. Obviously, you need to go for that. I mean, one headache that the PA doesn’t have to worry about. If you work for a big hospital-owned network or just a hospital, most of them nowadays are self-insured and almost none of them utilize claims-made coverage, or if they do, they’ll almost always cover the tail costs for the physician assistant. So, really the only time you have to worry about paying for tail insurance is if you were to work for a smaller physician-owned practice, and then they were to shift the burden onto the physician assistant. Other topics of interest include:

  • What is Claims Made Insurance for a Physician Assistant?
  • Should a Physician Assistant Choose Claims Made or Occurrence?

If you do have a claims-made policy and you ask the employer to cover the cost, and they say, no, one effective tool would be to ask them to forgive a portion of that cost over time. For instance, let’s say you have a three-year initial term when you sign your contract, you should say, alright, for every year that I’m employed, you would forgive a third of the amount of whatever the tail cost is. And so, after the three-year initial term, the employer would pay for the rest of the tail insurance. As far as the underlying premium goes, with the occurrence policy being a third more expensive than claims made, that’s something that the employer will always pay for.

Physician Assistant Malpractice Premiums

If you’re a physician assistant and you’re an employee, you should never pay for your underlying premium. If you’re working as an independent contractor, that’s a different story. Most of the time, if you’re working as an independent contractor, they’re going to expect you to purchase your own tail insurance if you have a claims-made policy in addition to paying for your underlying annual premium. So, you need to do a math equation of, alright, how long am I going to work for this employer?

How much is my underlying premium? And then that can help you decide, alright, I should get an occurrence-based policy, or maybe claims-made makes more sense. I mean, if you’re going to be short-term, an occurrence-based policy makes the most sense mathematically. So, something to think about.

Claims Coverage Tail Cost 

How much is tail insurance for a physician assistant? First, let’s talk about the different types of malpractice policies. And then we’ll talk about how much it’s going to cost if you must pay for it. First, the setting is important. If a PA is employed by a hospital or hospital network, normally, they’ll either be self-insured or have a claims-made policy, or they’ll cover the cost of tail. Very rarely if you’re a PA and you work for a hospital, will you have to pay for your own tail insurance. It just doesn’t happen very often. Now, if you’re in a private physician-owned practice, it’s more likely than not, that if they have a claims-made policy, that you will be responsible for paying the tail costs.

Most private practices use one of two types of insurance. The first is called occurrence-based coverage. With an occurrence-based coverage, it just simply means the policy has to be in effect when the malpractice incident occurs, and therefore, tail insurance is unnecessary. Now, why would you choose one over the other? Well, an occurrence-based coverage is about a third more expensive, so it’s kind of a math equation of, alright, would you rather pay a third more per year to be insured but not have to pay anything at the end for tail, or is it better to have a third less per year and then pay the tail cost at the end of it? For occurrence-based coverage, you don’t need tail insurance. Now, if it’s a claims-made policy, you do. Claims policy simply means a policy has to be in effect when the claim is actually made.

If a PA is employed, and the agreement is terminated, there’s still a gap in between the last patient that the PA saw at the practice and then the last day somebody sues you. In most states, it’s either two years from either when you knew or should have known of the malpractice incident. There are some exceptions for minors when they become adults. But for the most part, two years is kind of a good rule of thumb. In that scenario, if the PA left the employer and didn’t have a tail policy and was sued two years later, well, they’d be out of luck. They’d have no backup as far as malpractice insurance goes. Almost any employment agreement is going to dictate that one, tail insurance has to be purchased, and then two, who has to pay for it.

How it would work is in the contract, if the PA is responsible to pay for tail, then normally, it will state they have to purchase the tail policy prior to the agreement terminating. Usually in the last week of their employment, they’d make certain that the tail has been secured, and then they’ll have to provide proof to the employer. Tail costs are usually around twice what the annual premium is for the PA. An annual premium is simply how much the employer must pay to insure the PA on a yearly basis. You just multiply that number times two, and then that’s how much the PA would have to pay for tail. It’s a one-time cost. You don’t have to pay it every year, but it does have to be paid upfront.

Occurrence Breakdown

How much is a normal annual premium for PA because that’s going to dictate how much tail is. Usually, PAs are somewhere between 1500 up to 4,000, depending upon specialty, but I’d say 2,000 is around the average. If you take two, multiply that by two, and tail costs would be around 4,000. A couple of things to think about, one, you certainly can negotiate prior to signing the employment agreement who must pay for tail. If the employer is just simply unwilling to make changes, one thing we’ve had success with is just to say, alright, if the term of my agreement is three years, then the employer will then forgive a percentage of the tail cost per year. So, if you have a three-year term, then maybe the employer would agree to cover one-third of the cost if you stay for one year, two-thirds for two years, and then they’ll pay for all of the tail after three years.

Some employers are willing to do that versus an all-or-nothing type of thing. Another way of getting out of paying for tail insurance would be if your new employer pays for your old tail. That’s called nose coverage. And then another way of getting out of paying for tail is if you stay in the state, the new employer you have has the same insurance company. They’ll just roll over your policy into the new one most of the time. And then you wouldn’t have to pay for tail insurance. It’s not prohibitively expensive for a PA. However, it’s still going to be thousands of dollars that the PA is going to have to pay in one big lump sum. And most people don’t want to do that. As I said before, it’s more likely than not, probably like 75% of all private practice jobs require the employee to cover the cost of tail. Something to keep in mind:

Is this a deal-breaker for most people? Probably not. However, if you’re hopping jobs a lot, you’re still going to have to pay. And the contract says you’re going to have to pay for tail. You’re going to pay for tail every single time. If you’re going to be long-term with an employer, maybe not be that big of a deal if you must pay for it. If you’re going to have a new job every year and you must pay tail every year, well, that could add up over time. And that may be something you really want to make certain that the employer covers or even think, alright, well, if a hospital employee job almost always has the employer pay for tail insurance, then maybe I want to lean more towards hospital or hospital network positions versus private practice where I must pay for it more.

Definitely can be negotiated in advance. Deal-breaker? Probably not, but certainly something to think about. So, that’s a little primer on tail insurance and how much it costs.

 Red Flags Outside of Professional Liability Insurance

What are some red flags in physician assistant contracts? Sometimes the red flags are the words on the page, but other times red flags are missing. I’m going to kind of go over the most common red flags that I see. The first one would probably be unreasonable non-compete clauses. Depending on your state, most states’ non-compete clauses for healthcare providers are enforceable, but you do want to check your state law. If they are enforceable, you want to check is it reasonable? What I mean by that is, normally, a non-compete clause will be anywhere from one to two years. I always try to advocate for at least one year only, not over a year.

One year, it should be, or less. It could be six months, that would be great. And then you want to look at the restricted area. Typically, it goes by miles and it kind of depends. You must take into consideration where you’re located and what your makeup looks like. Like, are you in a rural area? Are you in a city? And then you want to see, okay, is this mileage unreasonable? Really anything over 30 miles is going to be, in my opinion, unreasonable. And I would try to negotiate that down. So, we’ve talked about how long they’re for, and then how much is included in that restricted area from competing with your employer. The other thing you want to look for is how many locations does that restricted radius apply to? This is a little tricky and a lot of times employers try to slip this in there.

They may say or have language in there that states any location of the practice with the company, or they’ll say any location you provide services at. That means if you fill in for a provider that’s on vacation, you’re a non-compete clause now attached to that location. Let’s just say you have 10 miles from your primary location, but now you could have 10 miles attached to multiple other locations. This is dangerous especially if let’s say the company expands while you work for them. And it could knock out a huge chunk of the state. You may have to move if you decide to end your employment. So, overly restrictive non-compete is a red flag. The other thing you want to look for in a non-compete itself is what services are you restricted from?

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Destinee Hamlet
2023-01-31
Everyone was very helpful and professional. Felicia answered all my questions and made the process super easy and stress free.
Gabriela Martinez
Gabriela Martinez
2023-01-29
Definitely recommend! I’m a nurse practitioner and was able to renegotiate my contract with the help of Chelle Law. The outcomes were above expectations.
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Linda Price
2023-01-27
I placed my trust in Chelle Law to handle my issue with the State Board of Nursing and they did not disappoint. Service was professional and courteous. I could not have asked for a better outcome. I highly recommend this firm!
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Anni R
2023-01-25
I had a great experience with Chelle Law. I’m so glad I found them and hired their services. Their communication was on point 👌 they’re very professional, always kept me updated, always returned my calls and emails in a timely manner. They’re compassionate and understanding of every situation. I would 100% use them again and refer them to anyone.
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Chin Kim
2023-01-24
Great hep overall. Fast response and even it was an hour review, the attorney stayed on the phone longer to answer all my questions.
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Amelia
2023-01-20
Booking the consultation was easy and I got all my questions answered! Excellent customer service.
Steven Yang
Steven Yang
2023-01-18
I am a veterinarian about 3 years+ out from school changing jobs for the first time since graduating . The idea of needing to closely review a contract was foreign to me and I honestly had no idea what I would be signing . Luckily I found Chelle law and worked with Erin who put all my worries at ease . She took the time and even went over our scheduled time slot to review / translate every section of my contract and make valuable suggestions that I could bring up to my future employer. Throughout our discussion it was clear to me that Chelle law is very familiar with the intricacies of a veterinary contract and what it typically should entail. I was very pleased with my experience .
Tiffany Efantis
Tiffany Efantis
2023-01-11
I used Chelle law for a non-compete clause review. I was referred to them by a friend. They were helpful, quick, and affordable for what I needed. I will definitely use them again for any employment contract review in the future!
Nicholas Peracchio
Nicholas Peracchio
2022-12-13
Erin was so thorough with my contract I felt extremely confident in my negotiations and ended up getting everything I wanted and more! I can’t recommend her enough. She took her time and made sure I understood everything I was signing and did so with a kind and caring demeanor. Thanks so much Erin!!
Seth Bricel
Seth Bricel
2022-12-13
I needed a lawyer to review my partnership contract and Chelle Law provided a great experience at a fair price. My lawyer thoroughly explained the meaning of the contract in terms I could understand and provided valuable perspective as to which parts were normal and which parts were atypical or in need of modification. Thanks to their help, I've reached a contract that I and my partners are very happy with!

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