South Florida Hospital News
Sunday June 13, 2021

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June 2021 - Volume 17 - Issue 12


Separate Medical Malpractice Policies Key to Protecting Physicians

In the medical field, it’s beneficial when physicians, nurse practitioners, physician assistants, and the practice they belong to all work as one, providing a multidisciplinary approach to patient care. But in the medical malpractice world, it’s much smarter to keep these different individuals separate—especially when sharing insurance limits.

“While many physicians practicing in Florida carry $250,000/$750,000 limits, there is a problem if they are sharing these limits with their corporations as well as professional allieds such as nurse practitioners and physician assistants,” explained Julie Danna, cyRM, medical malpractice and cyber liability insurance specialist at Danna-Gracey, the largest independent medical malpractice insurance agency in Florida.
“If a doctor gets sued along with his or her allieds and the corporation, it can leave that policy depleted,” she said. “If there is not enough coverage, the policyholder is responsible for the rest.”
Danna gives the example of a surgeon who had lower policy limits than he needed and ended up paying more than $75,000 out-of-pocket to settle a claim. “He’s no longer practicing,” she said. “It’s destructive enough to be pulled into a lawsuit, but then to have to use your own money above the limits of the policy to settle it can destroy a career.
“What scares me most is that so many physicians are completely underinsured,” she added. “Take the example of an OB/GYN with a $250,000 limit. If he gets sued for $125,000 and his nurse practitioner gets sued for $75,000, and the corporation gets sued for $100,000—who pays the difference? His legal fees may be covered, but the rest is the doctor’s responsibility.”
There are several reasons why physicians don’t carry separate policies, ranging from lack of knowledge to trying to save money. “In some cases, they just aren’t aware of what can happen if everyone is on the same policy,” said Danna. “Others are trying to save money by not insuring the corporation and the allied professionals separately, but this can cost them in the long run.”
She added that most carriers charge physicians to add allieds and corporations to their policies, and this premium could be used to create a separate corporate policy that shares its limit with the allied providers, and protects the doctor from diluting his or her policy.
Even if a doctor isn’t sued but the allieds or corporation is, it can affect the physician’s credentialing ability. “This information is reported to the National Practitioner Data Bank (NPDB), and the doctor can be pegged for a claim that he or she is not even involved in,” said Danna. “It can hold up the credentialing process, especially if there is more than one claim.”
Danna adds that multiple lawsuits—even if they do not directly include the doctor—can affect that physician’s ability to receive hospital, Medicare, or healthcare plan credentials and prevent the purchase of a corporation if its owners want to sell.
“Each doctor should have his or her own policy and have a corporate policy that includes the allied professionals,” she said, adding that it’s essential to work with a specialist in the medical malpractice field instead of an insurance generalist. “It could save a doctor’s career.”

For more information, contact Julie Danna at, call (850) 530-3924 or visit

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