| | Winning the Game of Risk: Make The Right Malpractice Coverage Moves- Continued
Additional Issues: Locum Tenens And Malpractice
Locum tenens is still a nascent industry, although an increasingly important one. Healthcare facilities spend more than $2 billion a year on temporary physician services alone, and tens of thousands of providers—physicians, mid-levels and nurses—practice on an interim basis. Yet only a few locum tenens staffing firms have been in existence for more than 10 years.
The nature of the industry, the need for rapid placement of providers, the need to keep costs in check and the geographic reach of staffing firms demand attention when considering hiring temporary providers or practicing on a temporary basis.
Often in the temporary staffing industry, longevity in the business depends upon reputation and careful attention to such details as malpractice coverage. The industry is particularly subject to insurance mismanagement; when smaller staffing firms shut down or merge into larger firms, when malpractice carriers leave certain states or close, when carriers increase costs beyond an amount supportable by firms operating on a slim profit margin—any such event often leaves physicians and practices unprotected. Unless the staffing firm is diligent in regard to purchasing "tail" for providers who, in many cases, no longer even work in the industry, problems may ensue. Remember, there is no guarantee a firm will continue to purchase the necessary tail coverage.
Key question to ask: What are the staffing firm's predetermined coverage limits and how close is the firm to surpassing those limits?
Another point to consider: Does the staffing firm maintain tail coverage through its current malpractice carrier and all previous carriers? Reputable firms secure coverage through highly rated (A.M. Best A+ or A++) carriers. It is critical to assess malpractice coverage before deciding on a permanent or temporary opportunity, before recruiting and before selecting a locum tenens staffing firm. It is important, then, to discover each firm's rules regarding state compensation funds. It may take some time to read through and properly evaluate a malpractice policy, the longevity of that policy, its rules regarding state compensation funds and so on. With the wrong policy in place, however, it may only take one incident to damage a practice or a career.
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