Workers’ Compensation Update: Medical Practice Consolidation and its Effect on Workers’ Comp

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By Tom Murphy

Now that the Patient Protection & Affordable Care Act has become a reality, Florida is starting to see greater activity in physician and medical-practice consolidation. This consolidation is creating a whole new set of risks and exposures for hospitals, large groups, and ACOs (accountable care organizations), as well as for the physicians who are joining them.  Many of the individuals involved in this process are so consumed with making the transition that they have not taken the time to realize and understand the new risks associated with this change.

Workers’ compensation coverage is one of these issues that needs to be discussed prior to completing the transition from small practice to hospital or large-group employment. When contemplating the move to a hospital or large-group setting, physicians and administrators need to be aware of who is responsible for the employees. Some physicians and groups maintain an LLC or other corporation even after joining a hospital or larger group. You need to be clear on who is required to provide the workers’ comp coverage. Typically, the hospital is self-insured or has coverage in place for this transition. The larger groups and ACOs may not have established the coverage due to their recent formation and overwhelming workload trying to secure the necessary contracts and comply with new government regulations.

Regardless of the type of transition, it would be wise to discuss the responsibility for the workers’ compensation coverage and request the proof of coverage when applicable. The Florida Division of Workers’ Compensation has increased their investigations into fraud and compliance and the fines can be hefty. If you have additional questions or would like more information about this issue, please contact your agent or feel free to call Tom Murphy at 800-966-2120.