Q: With a more difficult, “hard market” predicted to hit Florida’s malpractice insurance market soon, what should we be considering in our medical practice to be prepared? 

A: Just like creating hurricane plans before the fury of a storm descends upon you, now is a good time to be positioning your practice for the impending hard market in malpractice insurance that will be unfolding in the next few years, just at a time when many practices are challenged by decreasing income and rising expenses. The best strategy can be broken down as this:

1. Preventative: Focus yourself and your entire practice team on risk management. Many times doctors overlook the importance of including the staff in risk management discussions. Studies show that the friendlier your whole practice environment is the lower your risk of a lawsuit. Many higher end malpractice insurers offer risk management assessments of your practice including in-office observations and recommendations, all for free. Alternatively many offer self-assessment tools. Take advantage of these free services!
2. Review your malpractice insurance coverage with an experienced specialist to make sure you are on “high ground” when the storm unfolds. Beware of the many offers from small, new, unrated insurance companies now offering coverage in Florida. Ask your broker to shop your coverage to a number of rated insurers and remember that in this market cycle just before an upturn you will see many offers that are too good to last. The few strong insurers have the ability to withstand the upcoming market pressures because they are not highly leveraged, are not offering actuarially unsound rates, and have a long term not short term philosophy. Find those and you will be much better off when the high winds are pounding on your practice windows!
3. Create negotiating power: Many medical societies, networks, and hospitals have created malpractice insurance purchasing groups to give even smaller practices the negotiating power of larger ones. If you cannot find a suitable purchasing group then consider creating one with your peers, now before the market changes. Such groups are fairly simple to start, legal, and will help you weather the next cycle of sharply increasing malpractice rates.
4. Make sure that your asset protection plans are up to date and if you need to transfer assets around do so soon before many more claims get filed against doctors after the much predicted upcoming overturn of the 2003 caps on non-economic damages.

We at Danna-Gracey are here to help if you need specific direction and recommendations on any of these suggestions and would be honored to become part of your trusted team.