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      • Dental Malpractice Insurance
        • Claims Made Insurance for a Dental Associate Explained
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        • Should a Dentist Choose Claims Made or Occurrence Insurance?
        • What is Tail Insurance for a Dentist?
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      • Dental Contract Benefits 
        • Does a Dentist Have to Repay a Bonus if they Terminate the Contract?
        • How Much PTO Should a Dental Associate Get?
        • How Much Should a Dentist get for CE Expenses?
        • Should a Dentist be Reimbursed for Moving Expenses?
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        • Is a W2 or 1099 Better for a Dental Associate?
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    • Nurse Practitioner Contract Attorney
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        • Can a Nurse Practitioner Break Their Contract?
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        • What Needs to go in a Nurse Practitioner Termination Letter?
      • 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?
        • Is 10 Miles a Reasonable Non Compete for a Nurse Practitioner?
        • Is a 2 Year Non Compete for a Nurse Practitioner Reasonable?
        • Is a Non Compete Enforceable Against a Nurse Practitioner?
        • Nurse Practitioner Non Compete vs Non Solicit
      • Nurse Practitioner Contract Benefits
        • Does a Nurse Practitioner Repay a Bonus if the Contract is Terminated?
        • How Much Paid Time Off Should a Nurse Practitioner Get?
        • Should a Nurse Practitioner be Reimbursed for Moving Expenses?
        • What Benefits Should be in a Nurse Practitioner Offer Letter?
        • What Nurse Practitioner Expenses Should an Employer Pay For?
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        • Is a W2 or 1099 Better for a Nurse Practitioner?
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        • What is a 1099 Nurse Practitioner?
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          • ECFMG Eligibility
        • How Many Years Should the Term of a Physician Contract Be?
        • Should a Physician Accept an Arbitration Clause?
        • What Is the Best Without Cause Termination Length in a Physician Contract?
      • Medical Malpractice Insurance
        • What Is Claims-Made Insurance For a Physician?
        • What Is Occurrence Insurance for a Physician?
        • Should a Physician Choose Claims-Made or Occurrence Malpractice Insurance?
        • What Is Tail Coverage for Physician Malpractice Insurance?
        • When Does a Physician Need to Pay for Tail Insurance?
        • How Much Does Tail Insurance Cost for a Physician?
        • 3 ways a physician can get out of paying for tail insurance
      • Non-Compete Agreements
        • Is 10 Miles a Reasonable Restriction in a Physician Non-Compete?
        • Is a 2-Year Physician Non-Compete Too Long?
        • How Many Locations Should a Physician Non-Compete Apply to?
        • Is a Non-Compete Enforceable Against a Physician?
      • Medical Professional Contract Benefits
        • How Much Should an Employer Give a Physician for CME Expenses?
        • What Physician Business Expenses Should an Employer Pay for?
        • How Much PTO Should a Physician Get?
        • Should A Physician Receive Relocation Reimbursement When Moving for a New Job?
        • Does a Physician Have to Repay a Sign-On Bonus When They Leave?
        • Does A Physician Have to Repay Relocation Assistance If They Leave?
      • Independent Contractor Agreements
        • Can a Physician be an Independent Contractor?
        • Physician Independent Contractor vs Employee
        • Is a W2 or 1099 Better for a Physician?
        • 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 a Physician Assistant Should Negotiate a Contract
        • Red Flags in a Physician Assistant Employment Contract?
        • What is the Most Common Physician Assistant Compensation Model?
        • What Should Go Into a Physician Assistant Termination Letter?
      • Physician Assistant Malpractice Insurance
        • How Much Does Tail Insurance Cost for a Physician Assistant?
        • Should a Physician Assistant Choose Claims Made or Occurrence Insurance?
        • Tail Insurance for a Physician Assistant Explained
        • What is Claims Made Insurance for a Physician Assistant?
        • What is Occurrence Based Insurance for a Physician Assistant?
      • 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
      • Physician Assistant Contract Benefits
        • Does a Physician Assistant Repay a Bonus if the Contract is Terminated?
        • 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
      • Veterinary Associate Employment Contracts
        • Can You Break a Veterinary Associate Contract?
        • How is a Veterinarian Given a Draw in a Contract?
        • How to Negotiate a Veterinary Associate Contract
        • Red Flags in a Veterinary Associate Contract
        • What Should be in a Veterinary Associate Termination Letter?
      • Veterinary Malpractice Insurance
        • What is AVMA Excess Limit Coverage?
        • What is AVMA Veterinary License Defense Insurance?
        • What is Occurrence Insurance for a Veterinarian?
        • What is the AVMA PLIT?
        • Why Veterinarians Do Not Need Tail Insurance
      • Veterinary Non Compete Agreements
        • How Many Locations Should a Veterinary Non Compete Apply To?
        • Is a Non Compete Enforceable Against a Veterinarian?
        • Veterinarian Non Solicit vs Non Compete
        • Veterinary Non Compete Mile Radius Explained
        • Veterinary Non Compete Time Limits Explained
      • Veterinary Professional Contract Benefits
        • How Much PTO Should a Veterinary Associate Get?
        • How Much Should a Veterinarian get for CME Expenses?
        • Must a Veterinarian Repay a Bonus if They Terminate the Contract?
        • Should a Veterinarian be Reimbursed for Moving Expenses?
        • What Veterinarian Business Expenses Should an Employer Pay For?
      • Veterinary Independent Contractor Agreements
        • Pros and Cons of Employment at a Corporate Veterinary Office
        • Should a Veterinarian be a W2 or a 1099?
        • Veterinarian Independent Contractor Tax Deductions
        • Veterinary Independent Contractor vs Employee
        • What is a 1099 Veterinarian?
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Should a Physician Choose Claims-Made or Occurrence Malpractice Insurance?

Malpractice insurance is a type of professional liability coverage that helps protect physicians and other healthcare professionals from the financial risks associated with lawsuits in which patients believe they were harmed as a result of an incident involving medical care. The amount of coverage depends on how much the policy is worth (premium) as well as your specialty – personal injury attorneys are more likely to take cases against doctors working in hospitals than those who practice family medicine or internal medicine in private practice.

Most malpractice insurance carriers provide coverage that has a deductible clause that can range anywhere between $0 -$100k per incident with most doctors opting for higher deductibles due to lower premiums. A deductible clause in a malpractice policy stipulates that the insurance company will not provide coverage for any expenses incurred by the insured for injuries or damages up to an agreed-upon amount. A deductible clause in a malpractice policy stipulates that the insurance company will not cover any expenses incurred by the insured for injuries or damages up to an agreed-upon amount per incident. The typical carrier’s deductible is usually $5000, but it can be higher, sometimes as high as $50,000 depending on individual state requirements and claims history.

Policy Deductibles

However, some states have limits on how much of a doctor’s income can be subject to such deductibles before he must buy additional coverage known as “excess” coverage.” The standard excess limit is 50 percent the doctor will make in annual gross salary

Malpractice policy provides legal defense coverage to the doctor from medical liability arising from clinical care that results in injury or death. Each policy period provides limits; which are the maximum amount an insurance company will pay per event. Thus, if your insurance policy has a limit listed of $1,000,000 per occurrence if there is a settlement or judgment, that is the maximum amount your medical malpractice insurer will pay towards claims filed within the term outlined in your policy.

Claims-Made Medical Coverage

A claims-made policy will only provide insurance coverage if the policy is in effect when both the incident first happened and when a lawsuit is filed against the doctor (when the claim is made). Thus, there is a chance a lawsuit can be filed after a doctor leaves an employer. In situations like this, with claims-made medical malpractice insurance, a tail policy must be purchased by the medical provider which covers the gap between when doctors leave an employer and when the statute of limitations on filing a malpractice liability insurance claims ends.

Claims-made coverage is used in cases where there may be periods of time when coverage is not available, such as doctors changing jobs. In these situations, the tail policy will provide coverage from liability for up to three years after leaving an employer. The tail policy also has other limitations and exclusions which can make it difficult for doctors who leave employers often or have a history of high liability claims against them to find and fund affordable medical liability insurance coverage.

Assuming claims-made coverage is in effect, a good rule of thumb is tail insurance costs around 2 times your annual malpractice insurance premium.  Thus, if your annual medical premium costs $6000 per year; your cost paid to the insurance carrier would be around $12,000.  Your tail insurance cost to the carrier is a one-time payment; it is not an annual cost.  

The physician’s employment agreement will specify whether employers or physicians should cover expenses for the tail insurance if it is claims-made insurance.

Occurrence Coverage Liability Insurance

An occurrence policy differs from claims-made in that occurrence coverage provides coverage for any claim for an event that took place during the period of coverage, even if the claim is filed after the policy expires.  Thus, an occurrence policy does not require tail insurance against new claims.  

The permanence of an occurrence policy is the main advantage over a claims-made policy. The period of time you are protected under the policy lasts forever and you do not need to renew or buy tail insurance when you leave the employer. You can also take a job in another state, and you will still be covered from any claims.

Should-a-Physician-Choose-Claims-Made-or-Occurrence-Malpractice-InsuranceDownload

Which Choice is Best for Physicians if there is a Paid Incident

Both policies offer the same policy limits issued by the same insurance carrier, along with the same endorsements against claims. The cost of occurrence based and claims-made coverage can factor into a doctor’s decision:

Claims-Made Cost: Assuming claims-made coverage is in effect, a good rule of thumb is tail insurance costs around 2 times your annual malpractice insurance premium.  Thus, if your annual medical premium costs $6000; your cost to the insurance carrier would be around $12,000.  Your insurance cost is a one-time payment; it is not an annual cost.  The American College of Physicians offers resources and information for multiple insurance options through AGIA Affinity for individual doctors and any practice.

Occurrence Cost: Since tail insurance is not needed under an occurrence-based insurance policy, the annual premium for an occurrence-based policy is approximately 35% more than a claims-made policy. So, if the average claims-made policy annual premium is $6000, an occurrence-based policy would cost $8100 in coverage. The cost of insurance coverage should be based upon the claims history of the provider and the number of individual and group clients seen per year. Providers with high annual visit counts (or number of admitted seen if in-patient) will have a lower insurance premium, since their claims are spread out over more people.

A retroactive date defines how far back in time claims can occur for your policy to cover your claim. If a claim happens prior to the date the insured’s policy is effective, the insured’s policy won’t provide retroactive benefits from the carriers for when the incident occurred. It’s a feature and form of claims-made professional liability coverage.

Occurrence Malpractice Resources for Doctors

The cost of insurance coverage is based upon the claims history of the provider and the number of individual and group patients seen per year. Providers with high annual visit counts will have a lower insurance premium, since their claims are spread out over more people. Thus, the choice of claims-made or occurrence is important.

Additionally, doctors who perform below average in terms of malpractice insurance claims will pay less than doctors who incur higher claim rates. A doctor’s risk profile is also taken into account when determining the rate an insurance company will charge for the occurrence-based policy. Provider age is also factored into the equation, as younger doctors are considered to be at higher risk of committing acts that could lead to liability or making an error than older practitioners.

Claims Made Malpractice Advantages

  • Ability to increase limits or buy new coverage with claims made malpractice insurance
  • Portable and can be moved from one insurance business to another

Occurrence Advantages

  • Permanence of coverage to insure.  Protected forever for each year under the policy period.
  • No need to renew or buy tail when your employment ends with occurrence malpractice insurance makes choosing this an easy decision for many.

Tail Information from an Attorney

Contracts are a pervasive and obligatory part of nearly all business and legal transactions. Well-drafted contracts help to enumerate the responsibilities of the involved parties, divide liabilities, protect legal rights, and insure future relationship statuses. These touchstones are even more crucial when applying their roles to the case of a physician employed by a hospital, medical group, or other health care provider. While contract drafting and negotiation can be a long and arduous process, legal representation is a must in order to ensure that your rights are being protected.

The present-day conclusion is simple: A physician should not enter into any contract without having a physician contract review by legal counsel.

There is simply too much at risk for a physician to take contract matters into their own hands. In addition to the specific professional implications, contract terms can significantly impact a physician’s family, lifestyle, and future. There are many important contract terms and clauses which can present complex and diverse issues for any physician, including:

  • Non-compete clauses
  • Damages
  • Indemnification
  • Verbal guarantees
  • Insurance statements

Additionally, often times the most influential terms and clauses in any employment contract are the ones that are not present. With the advent of productivity based employment agreements it is imperative that any physician have an employment agreement reviewed before it is executed. Attorney Robert Chelle has practical experience drafting and reviewing physician contracts for nearly every specialty.

New residents, attending physicians, doctors entering into their first employment contract or established physicians looking for new employment can all benefit from a thorough contract review. By employing an experienced attorney for your representation, you can insure that you will be able to fully understand the extensive and complex wording included in your contract. By having a full and complete understanding of the contract, you will be in a better position to make your own decision on whether or not you want to enter into the agreement which will affect your career life for years to come.

The financial benefits gained from having your contract reviewed and negotiated by an experienced healthcare attorney far outweigh the costs associated with a review. You are a valuable resource, and you should be treated and respected as such. Attorney Robert Chelle will personally dedicate his time to make sure that your are fully protected and will assist you in the contract process so that your interests are fairly represented.

Every physician contract is unique.  However, nearly all contracts for health care providers should contain several essential terms.  If these essential terms in the contract are not spelled out in contracts, disputes can arise when there is a disagreement between the parties as to the details of the specific term.  For instance, if the doctor is expecting to work  Monday through Thursday and the employer is expecting the provider to work Monday through Friday, but the specific workdays are absent from the Agreement; who prevails?

Spelling out the details of your job is crucial to avoid contract conflicts during the term of your employment.  Below is a checklist of essential terms that contracts should contain (and a brief explanation of each term):

  1. Outside Activities: Are you permitted to pursue moonlighting or locum tenens opportunities? Do you need permission from the employer before you accept those practice of medicine related positions?
  2. Practice Call Schedule: How often are you on call (after hours office call, hospital call (if applicable))?
  3. Base Compensation: What is the annual base salary? What is the pay period frequency?  Does the base compensation increase over the term of the Agreement? Is there an annual review or quarterly review of compensation?
  4. Productivity Compensation: If there is productivity compensation; how is it calculated (wRVU, net collections, patient encounters, etc.)? Is there an annual review?
  5. Paid Time Off: How much time off does the job offer? What is the split between vacation, sick days, CME attendance and holidays?  Is there a HR guide?
  6. Dues and Fees: Which business financial expenses are covered (board licensing, DEA registration, privileging, AMA membership, Board review)?
  7. Relocation Assistance: Is relocation assistance offered? What are the repayment obligations if the Agreement is terminated prior to the expiration of the initial term?
  8. Signing Bonus: Is an employee signing bonus offered? When is it paid?  Do you have to pay it back if you leave before the initial term is completed? Are student loans paid back?  Is there a forgiveness period for student loans?
  9. Professional Liability Insurance: What type of liability insurance (malpractice) is offered: claims made, occurrence, self-insurance?
  10. Tail Insurance: If tail insurance is necessary, who is responsible to pay for it when the Agreement is terminated?
  11. Without Cause Termination: How much notice is required for either party to terminate the Agreement without case?
  12. Non-Compete: How long does the non-compete last and what is the prohibited geographic scope?
  13. Non-Solicitation: How long does it last and does it cover employees, patients, and business associates?

If you have questions about claims-made or occurrence coverage and your current malpractice insurance or are interested in having your employment agreement reviewed contact Chelle Law today.

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If you are in need of assistance or would like to hear more about the services we offer contact Chelle Law today!

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Based on 121 reviews.
Melinda Striyle
Melinda Striyle
2022-06-12
Attentive, respectful, great to work with.
Jenn Lighthall
Jenn Lighthall
2022-06-10
Absolutely fantastic. I would give more than five stars if I could. Highly recommend!
Meghna C.
Meghna C.
2022-05-31
Renee was great to work with when negotiating my contract! I am a resident physician signing on for my first attending job, and I felt more comfortable with the language used in the contract after going over it with Renee. I also got a higher starting salary which made the price more than worth it. I would definitely use Chelle Law again!
Jennifer Nevis
Jennifer Nevis
2022-05-30
Erin Howlett saved me from a terrible situation and I can't thank her enough. I had accepted a veterinary dental residency in northern Illinois with a private practice. The letter of intent was routine yet the actual contract so punitive and predatory in nature that it was hard to believe it was from the same people. Erin believed I was worth more than the "Zero" this practice claimed. Without her on my side, I would have naively signed this "bait and switch" and been finacially and professionally ruined if I couldn't complete the 6 year commitment this practice demanded.
robin singh
robin singh
2022-05-27
I consulted with Chelle law for contract review. They were suggested by our employer. Renee osipov was incredibly helpful and was able to navigate me in right direction. I fully recommend them.
Melanie Schlote
Melanie Schlote
2022-05-22
Erin was so professional and very quick to respond. She took the stress away from contract reviewing and made me feel confident in this next step of my career.
Mitul Patel
Mitul Patel
2022-05-22
I contacted Chelle Law for my dental contract review. I am very pleased with contact review with Attorney Renee. Renee was very kind, helpful, honest, informative and knowledgeable. She had some solid advice regarding negotiations. Katie was very helpful to schedule appointment with Renee within few days. I had some questions next day and emailed her and she responded back to me within an hour. I HIGHLY RECOMMEND CHELLE LAW FOR YOUR CONTRACT REVIEW. THANK YOU!!
Anna Etzler
Anna Etzler
2022-05-20
Renee was wonderful to work with and helped me with a contract review for my first NP job. She took the time to help me understand each section of the contract and even helped me successfully negotiate so that the contract would best fit my needs. Chelle Law was very responsive to my needs and set up my initial review and revision review in a timely manner! I would highly recommend their services to anyone in the medical profession.
Alan W
Alan W
2022-05-16
Had the privilege of working with their attorney Renee. She was really thorough, professional, and went above and beyond in reviewing my contract. Couldn't have asked for a better experience.

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