Medical Practice Insurance: 6 Ways to Better Manage Your Coverage

When my father started an insurance company for physicians back in 1969, virtually every physician in the nation was independent or at least in a somewhat autonomous small group kind of practice. Fast-forward 40-plus years and today fewer than 40 percent of physicians are in solo private practice. This trend will likely continue as physicians retire and younger physicians join the profession with a more corporate-healthcare mindset.

I’m a realist. I know businesses and professions continuously change, evolve, and innovate.  I know there are great physicians working for large healthcare corporations. I know our country needs large integrated healthcare systems to efficiently bring care to millions of Americans. Yet I still miss "yesterday’s" healthcare landscape in which physicians often cared for generations within a family and who would occasionally waive a payment in exchange for a fresh loaf of bread (Yes, Dr. Kiester actually did this in my home) and who made house calls.

Is that even realistic today? Is it even a good idea in terms of what is best for physicians and patients? I’m sure there are those who could argue both sides. But what I’d really like is to ensure that we maintain a marketplace that has something for everyone. Those physicians and patients who do want that independent practice option should have it.

One challenge we face in such an effort is that it is costly to run a small, independent practice today. Overhead, staffing, even insurance can be pricey.

Here are a few simple steps that can help independent physicians better manage their insurance programs.

1. Study your insurance policies, especially the fine print. Most physicians purchase their insurance policies early in their careers and 42 percent haven’t reviewed them for five years or more. Knowing what your insurance policies cover - or do not - is key to ensuring strong protection for your independent practice.

2. Look at how your practice has changed over the past few years. Have you added products such as weight loss programs or supplements? Are you offering nutrition, aesthetics, or some other service? Have you added independent contractors? If so, it’s time to take a look at the policies of the products and people now part of your office, as well as your own policy to ensure you are covered.

3. Work with a qualified broker. My company provides insurance - we aren’t brokers. But I can tell you from our side of the fence we see every day what happens when physicians don’t work with experienced and qualified insurance advisors and brokers.  If you don’t have one, find one. It will pay off.

4. Look for vendors that provide services you can’t build or your own. Large hospital systems and medical groups work with risk managers to provide training and tips on avoiding risks. Independent physicians should look for this level of support and guidance through brokers, insurance carriers and practice management partners that have the expertise and knowledge to help their practice learn how to avoid risk.

5. Take care of the basics. Security and HIPAA breaches are among the most rapidly growing types of claims experienced by physicians today. It could be something as simple as leaving on a computer with a patient file someone could see if walking by. It could be taking a laptop home and having it stolen. Make sure you educate staff - and yourself - and take steps to avoid these kinds of claims, which can financially devastate a small practice.

6. Don’t always go with the lowest price. Many physicians are looking to join small risk retention groups to reduce expenses. Make sure the insurer covering claims is rated at least an A+ or higher. Beware especially of new or discount carriers entering the market offering low costs to get business. Many of these are rated poorly and may not be around in a few years when you most need claims coverage. In today’s highly competitive insurance market, you should have your choice from among high quality insurers - all of whom would love your business. Stick with quality and then negotiate your price.

Physicians who want to remain independent have a growing number of resources available to help them. My expectation is that the options and resources serving independent practices will only increase. Those practices that run efficient and smart businesses will continue to flourish. I’m certainly cheering for the independent practice model as healthcare continues its innovative evolution. In fact, I have a fresh loaf of bread ready at home to prove it!