Look at some of the most common risks to your practice and how to manage them.
We examine key asset protection and risk management issues medical practice leaders should address in 2023 to ensure a safe and profitable year.
Our last discussion covered a sample of the predictable and manageable personal risks every doctor should address. This week, look at some of the most common risks to your practice and how to manage them.
Do a basic records tune-up
We often find that even well advised medical practices run into trouble when their key legal documents are missing or outdated. Make sure you have the following, that they are updated and that you actually know where they are. A missing document often means the courts decide what should have been, rather than the actual intent and agreement of the parties.
Manage employment law risk in three steps
Employment disputes are a serious exposure for medical practices. The average physician will statistically face two med-mal claims during their practice life but the average American business owner is five times more likely to be sued over an employment law issue than for any other reason, and the numbers are big. The average sexual harassment lawsuit, as one example, produces a verdict of over $500K and easily costs another six figures to litigate.You can manage this risk with a three-pronged approach.
First, have strong leadership and a culture of respect and compliance. Employees should know what kind of office you are running and what acceptable professional standards of conduct look like even before they get your employment policy manual. This means accountability, leading by example and correcting or removing those that fail to meet your standards, including front office staff, medical professionals and even providers and partners in your practice who play fast and loose with current standards and sensitivities.
Second, have a written, professionally drafted, state specific employment manual that both outlines your workplace polices and standards and which provides employees a meaningful and specific means of redress in a addressing any issues or conflicts before they become lawsuits.
Third, be heavily insured with both workers comp coverage and Employment Practices Liability Insurance (EPLI) that can cover both the costs of defense and potentially even judgment itself, if the first two layers’ fail for any reason.
Have a liability insurance “system”, not just a “policy”
Insurance works best as a system of layers that are designed to address specific threats. The most obvious policies are your medical malpractice policy and general business liability insurance that covers non-patient exposures on your property (like a slip and fall) at seven figure limits.
Beyond that, most medical practices need all of the following as well, at high limits. It’s also vital to be an informed buyer, which often means relying on an experienced, independent multi-line commercial insurance broker that has access to every policy from the entire market, not just one company they are captive to, as I advise my own clients to work with. A good agent will not only be able to find you the best coverage but will explain the differences between policies and how your coverage and protection may affected by issues like “shared limits” and “consent to settle” clauses.
Here is a sample of some of the high limit commercial insurance coverage I advise my clients consider having in place at seven figure limits.
This list isn’t fact specific to you, get professional help.
Attorney Ike Devji has 20 years of legal experience focused exclusively on asset protection, risk management and wealth preservation. He helps protect a national client base with more than $6 billion in personal assets, including several thousand physicians. He is a contributing author to multiple books for physicians, a Physicians Practice contributor for over a decade and a frequent national CME presenter. Learn more at www.ProAssetProtection.com.