Physician Financial Responsibility: Is It Your Responsibility?

Florida physicians are regulated by ch. 458, Florida Statutes, which mandates that doctors who practice in a hospital environment are required to maintain insurance or a letter of credit in the amount of $250,000.00 per claim. The law specifies that this is a condition of continuing hospital staff privileges.

 

Citing this requirement, Plaintiffs who obtained verdicts against physicians who were unable to pay pursued the credentialing hospital for payment. Some courts made hospitals pay patients who were injured by an uninsured physician in a hospital. Others disagreed and exempted hospitals from this financial responsibility.

 

In Horowitz v. Plantation General Hospital, Florida’s Supreme Court determined that when the Legislature enacted the financial responsibility statute, their intention was not to create liability on the part of a hospital for credentialing a physician. Initially, the Court noted that ch. 458 applies to physicians, whereas hospitals are governed by ch. 395. Moreover, the provisions of ch. 458 were intended to protect patients against dangerous physicians, not to provide financial responsibility. The Court also noted that while ch. 395 creates a duty for a hospital to report any disciplinary action against a physician, nothing requires the hospital to report a physician who fails to maintain financial responsibility.

 

Finally, ch. 458 allows a physician to “opt out” by simply asserting the ability to pay up to $250,000.00 within sixty days after a judgment. By opting out, physicians can legally practice in a hospital without having insurance or a bond; therefore, any physician who opts out might ultimately be unable to pay a judgment. Recognizing that no hospital can guaranty that a physician will be able to satisfy a judgment, the Court found no duty on the part of a hospital to compensate a patient injured by an insolvent physician.