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Asset protection shouldn't just be limited to malpractice. Here's why you need to looking beyond just that one area.
The majority of American doctors lack any serious asset protection planning beyond their malpractice insurance. A look at recent headlines show us why this is often a financially fatal mistake.
The sole focus of this column is asset protection and we’ve had hundreds of discussions on the wide variety of risks that doctors face and the danger of judging your risk level based only on the potential of a medial malpractice claim. That said, it is a serious risk; even in a relatively conservative state like Arizona, the top ten lawsuit verdicts of 2015 included three medical malpractice claims, all three were for more than $5 million (more about these cases soon).
No matter where in the country the clients I counsel actually practice, the legal advice and risk management I prescribe remains the same and is best summarized as, “Hope for the best, plan for the worst.” Here are some recent headlines that illustrate the scope and severity of these risks and touch upon the need for risk management I’ve previously covered in detail.
$7.5 million lawsuit filed against driver's doctor in seizure-related crash that killed Chesterfield man.
A physician who had been treating an elderly man for seizures released him to drive despite a history of seizures and warnings from other past treating physicians that the patient should not have been driving. After being released by the defendant doctor to drive, the patient blacked out, plowed completely through the home of the deceased victim at 120 miles an hour and killed him while he ate dinner at his kitchen table.
Judge: Doctor accused of not reporting child abuse can't be sued
In an Indiana case from earlier this month, a judge ruled that a physician couldn’t be sued for failure to report child abuse that resulted in the death of a child. The doctor was sued by the father of the child for failing to report the mother (his ex-wife) and the injuries to the child as required under state law. The one year-old child was beaten to death just a few months later. While this tragedy ended up in verdict for the doctor, efforts are underway in that state to change the law and had the suit proceeded the stakes would have been very high.
Lost Phone Costs Facility $650K -Extensive patient data aboard; incident ruled a HIPAA breach
I’ve covered the need for data security, equipment management and high levels of seven figures plus) of data breach/cyber liability insurance in several previous articles, this case is a good example. An employee of Catholic Health Care Services of the Archdiocese of Philadelphia (CHCS) lost an iPhone that was unencrypted, not password protected, and contained the names and personal identifying information (PII) of hundreds of patients including their social security numbers. The OCR has ruled this a breach and the provider settled for $650K, very wisely.
Florida sheriff arrests two paramedics for degrading selfies
In the “you can’t fix stupid but you can get sued for it” category is the story of two Florida paramedics. According to a CNN news report:
"Many patients were intubated, sedated, or otherwise unconscious at the time," said Okaloosa County Sheriff Larry Ashley's office Facebook page. "The defendants exchanged texts challenging each other to produce more selfies and to 'step up' their game."
Both paramedics have lost their careers and have each been charged with multiple criminal counts including multiple felonies. A total of 41 patients were involved or all ages and sexes, two of whom have died. Given the limited target value of the ambulance drivers from a lawsuit target perspective, I’d expect multiple lawsuits against their employer including both potential HIPAA claims and perhaps worse, negligence claims. If any of those patients can be positioned as having negligent care and outcomes because the paramedics were busy playing with their phones, the exposure for the employer is huge.
I’ve previously covered the need for social media polices (that includes phone usage), custom drafted employment manuals and insurance including employment practices liability and directors and officers coverage. While this was not strictly a medical practice case, it just as easily could have happened in a medical practice and often does, my comments on the death of Joan Rivers addressed this specifically.
The point of all this? We never know what or when the exposure you face will be, this means you have to be ready for anything, today.