Q. How do you get a medical leave of absence?

A. If you work for a company with fifty or more employees you may qualify for the Family Medical Leave Act, which typically allows up to twelve weeks for unpaid leave, or more if you are in the military. Also, your state may have its own laws that complement FMLA or add to this leave. Check with the Department of Labor in your state.

Q. What are the basic maternity leave laws?

A. This depends on the state, but the Family Medical Leave Act typically allows up to twelve weeks for unpaid leave. Also, your state may have its own laws that complement FMLA or add to this leave. Check with the Department of Labor in your state.

Q. What is the difference between claims-made & occurrence malpractice?

A. Claims-made covers you for claims submitted while the policy is in force, and also for a tort that occurred from the retro date through the date of the current policy. Occurrence policy covers claims that occurred during the policy period, and the policy does not have to be in force.

Q. Do IPA’s need medical malpractice insurance?

A. No, but they do need industry specific errors and omissions, and directors and omissions insurance that include vicarious malpractice, which cover the IPA’s risk for malpractice.

Q. What’s the difference between medical malpractice and errors and omissions?

A. They both cover errors; but, Medical Malpractice covers physicians for direct medical care and Errors and Omissions cover a business if it makes an error.

Q. What do statutory limits mean on a worker’s comp policy?

A. In many states you cannot sue an employer for more than $1 million by law, excepting gross negligence; therefore, it is a law, so the insurance policy models the statute’s limits.

Q. What is an excess worker’s comp policy?

A. It is for employers who self insure their worker’s comp. They buy excess or stop loss insurance. This insurance limits the employer’s exposure to unexpected total claims, or the specific claims of one person.

Q. What is excess of limit losses in workers compensation?

A. This can refer to an excess policy, which you can buy over a fully insured policy. Normally, workers compensation is limited to the statute, but if gross negligence can be proven then a claimant can sue for more than the limits of statute. If this happens, and the employer has an Umbrella policy, it may respond to the claim that exceeds the limit of the workers compensation policy.

Q. What is worker’s compensation aggregate retention?

A. This is the total amount of claims that you, the employer, pays until the insurer starts paying.

Q. How do you account for workers compensation aggregate stop loss deductible?

A. When you purchase aggregate stop loss for your self-insured workers compensation, the insurer will define upfront what the aggregate is. Your TPA, or third party administrator, should give you periodic aggregate reports showing the total amount of claims paid as they accumulate toward meeting the aggregate stop loss deductible.

Q. What are reinsurance triggers in healthcare?

A. It depends. Health insurers can have a defined dollar amount where they are laying risk off to a reinsurer. For example, a health insurer may buy a $100K of specific reinsurance coverage; thus, if one patient hits a $100K, then every dollar above that amount will be reimbursed by the insurer.
Q. What are the two types of stop loss in hospitals?

A. 1.Specific stop loss covers the hospital for claims that exceed a defined dollar amount for a patient. For example, the hospital for its self insured health plan, or its capitated members, can buy a $100K of specific stop loss deductible, which means the insurer will pay all claims that exceed $100K.

2. The other is aggregate stop loss which covers the hospital for all the claims it pays out in its self insured plan. For example, the insurer will cover you if your total claims paid in the year exceed $5 million. The insurer will reimburse the amounts that exceed that amount.

Q. Does a third party FMLA administrator have the right to contact your healthcare provider?

A. Yes, they have the right to ask for a second opinion, and/or have your doctor complete a form. But contacting them directly, I doubt, would be effective because the MD cannot talk with them due to HIPAA.

Q. What does it mean if your HMO sent a letter saying you have reached the catastrophic portion of your policy?

A. This can possibly mean that you have reached the maximum out of pocket limit.

Q. Can my employer stop my health care when on workers compensation?

A. Yes, they need to put you on COBRA. Health insurance requires that you are to actively working full time. When you are out on a worker’s compensation claim, you cannot meet this requirement.

Q. How can a company process employees’ medical claims?

A. The employer, if it is big enough, can take their claims in house and act as a TPA. Most companies do not do this anymore due to HIPAA concerns; most outsource this to an independent TPA.

NOTE: THE ABOVE IS A GENERAL DISCUSSION ABOUT HOW COVERAGES MAY WORK. YOUR INSURANCE POLICY AND ALL ADDENDA ARE THE ONLY AUTHORITY OF HOW YOUR COVERAGE WORKS. DO NOT RELY ON THIS ARTICLE AS AN EXPLANATION OF YOUR COVERAGE. HAVE YOUR ATTORNEY REVIEW YOUR ENTIRE POLICY WITH YOU TO DETERMINE WHAT IS AND IS NOT COVERED.

By William D. Dyer

Q: What the meaning of equal employment opportunity?
A: This typically applies to a business with fifteen or more employees that prohibits discrimination in any aspect of employment and harassment in the workplace based on race, color, age (40 and over), sex, pregnancy, gender, religion, disability, national origin, ethnic background, military service, and/ or citizenship.

Q. What is the ballpark estimate for directors and officer liability insurance?

A. It can be as low as $1,200 for a small business, to millions for a public company

Q. What is the typical annual premium for D&O in small business?

A. Typically it is $1,200 to $5,000.

Q. What is the cost for errors and omissions coverage?

A. This depends on the limits, industry, geographic location, and past claims experience. Some of the most expensive professions would be MD’s, Real Estate Brokerages, and Appraisal Firms, Insurance Brokerages, Engineering Firms and Law Firms.

Q. How do you apply for errors and omissions insurance?

A. You contact an insurance broker with expertise in E&O (it is an insurance specialty). The broker will have you complete an application; if you have coverage currently they will obtain your loss runs for the past five or ten years. The broker will shop your coverage to multiple insurers.

Q. How much is a $100,000 of general liability?

A. Assuming you are not in something risky, an estimate would be $100 to $500 a year. Most companies buy this coverage with limits in the millions.

Q. What is product professional liability?
A. As it implies in its name, it protects you from suits relating to the products that you produce, or a private label.

Q. Can an employer stop group health benefits during workers compensation claims?

A. Yes; and the employer should. You have to check with your health insurer to see what the contract dictates, but most have a limitation that coverage is for full time employees working twenty-five or thirty hours a week. If an employee is on Workers Compensation, he/she is not working, so therefore, he/she is no longer eligible for group health insurance. You should offer him/her COBRA. If you do not do this, the health insurer can deny the claims of the employee. We know of an employer, which is not our client, who kept an employee on his/her group health insurance while the employee was on Workers Compensation. The employee had a massive heart attack while he/she was disabled. The employee mentioned it to the doctor, and it was entered into his medical record that he was out on a Workers Compensation claim. The employee was given open heart surgery that yielded a big bill, which the insurer denied since the employee was not eligible for health insurance at the time of the claim. The employer was sued for the bill and lost in court.

Q. Can you run a CA Family Rights Act with the Federal Family and Medical Leave Act?
A. Yes, CFRA and FMLA can run concurrently.

Q. Is excess workers compensation a liability policy?

A. Not excess, which usually refers to reinsurance – a self insured Workers Comp. However, if the question is, can you buy excess coverage or umbrella insurance to supplement the liability portion of Workers Compensation, the answer is yes. This is one of the reasons why one buys an umbrella for one’s company. If the Workers Comp limits are breached or used up, then the umbrella may respond. Please note that most states limit the liability for the employer to the limits of the Workers Comp policy unless there is gross negligence.

Q. What is worker’s comp aggregate retention?

A. If you self insure your Workers Comp and say if the past five years show your average claims with an inflation of $3,000,000 then a reinsurer may sell you an aggregate reinsurance policy that will pay all claims that exceed the expected claims of $3,000,000. The $3,000,000 is the aggregate retention or deductible.

Q. Where can you buy medical malpractice coverage while on the US rotation?

A. If you are a resident of the US, you can buy it from a typical malpractice insurer. The problem is the policy will be for one year, so if you are here for less than one year, you will want to pay the premium and request a refund for any unused premium and buy tail insurance. Tail insurance is to cover you for any claims that occurred during the time you were covered. If you are returning to your home country and never plan to live in the US, you will want to consult an attorney to see what your exposure is versus buying tail insurance. When in doubt, buy tail insurance.

NOTE: THE ABOVE IS A GENERAL DISCUSSION ABOUT HOW COVERAGES MAY WORK. YOUR INSURANCE POLICY AND ALL ADDENDA ARE THE ONLY AUTHORITY OF HOW YOUR COVERAGE WORKS. DO NOT RELY ON THIS ARTICLE AS AN EXPLANATION OF YOUR COVERAGE. HAVE YOUR ATTORNEY REVIEW YOUR ENTIRE POLICY WITH YOU TO DETERMINE WHAT IS AND IS NOT COVERED.

We get calls from all around the country from employees who want to know if their Family Medical Leave Act (FMLA) or Americans with Disabilities Act (ADA) rights have been violated. We explain that we are not attorneys. But here is one of the stories I was told by a caller:

I am 52 years old and I worked for (one of the biggest pet store chains in the US) XYZ as a store manager. At work I slipped on some water, fell and hurt my hip. I have a bad hip, and the doctor said I needed hip surgery. I went to my regional manager and told him I needed two weeks off for surgery.

I asked the caller, “Did they offer your FMLA paper work, and explain to you your FMLA rights? Did they give you the forms, et al?”

No, all he said was that he could not give me two weeks off but only one week. I had the surgery, came back and my doctor told me not to lift anything more than 20 pounds. I told my manager this restriction. Things went fine until one day some of the guys, who move dog food around, did not show for work and the manager told me to move them. I reminded him of my restriction of 20 pounds and he said “just bend from the knees, and move it all.” I reinjured myself and as I could barely move, things were not getting done in the store as fast and my regional manager fired me for bad performance.

Again we could not give him legal advice, but this is a classic example of a company not training its management/supervisors in Family Medical Leave Act and Americans with Disabilities Act. This man was entitled to up to 12 weeks of job protected leave and should have been given the forms and an explanation of his rights. Supervisors are personally liable for violating FMLA. Also, when he came back to work the weight restriction was a reasonable accommodation and should have been made via the ADA.

This is why at HCP National we provide FMLA and ADA training for managers/supervisors. It is not enough that the HR department knows these federal laws, the front line managers have to know these laws too, so they do not violate them and get the company and themselves into a lawsuit.

Imagine the lawsuit the man above might initiate. This all could have been avoided by having a 1 hour training session, twice a year with every manager and supervisor of XYZ.

HCP National is a Compliance Educator and Trainer on FMLA, FEHA, CFRA, EOC, OSHA, IRCA, Sect 125, COBRA and more, as well as a full service employee benefits insurance brokerage for employers with 50 or more covered employees, located in Orange County, CA.

NOTE THE ABOVE IS A GENERAL DISCUSSION ABOUT HOW COVERAGES MAY WORK. YOUR INSURANCE POLICY AND ALL ADDENDUM ARE THE ONLY AUTHORITY OF HOW YOUR COVERAGE WORKS. DO NOT RELY ON THIS ARTICLE AS AN EXPLANATION OF YOUR COVERAGE. HAVE YOUR ATTORNEY REVIEW YOUR ENTIRE POLICY WITH YOU TO DETERMINE WHAT IS AND ISN’T COVERED.

We’re on the social networks! Now what? Well, we just joined this new realm a few months ago and are eager to engage with you. Our clients and prospects are very important to us, which is why we decided to be a part of social media. We understand that the age of web 2.0 requires a level of conversing, Q&A, dialogue in order to build and improve relationships, as well as spur innovation and the sharing of ideas. So write, message, or talk to us about your concerns, questions, comments, etc. in the various social networks we are participating in which includes Twitter, Facebook, Friendfeed, and Linkedin.

Our expertise is in the healthcare industry and we offer excellent coverage at affordable rates for doctor’s who need medical malpractice insurance and hospitals and businesses that need group health coverage. We also specialize in business liability insurance such as Errors and Omissions and Directors and Officers insurance. You can check out our other offerings here.

Looking forward to chatting with you!

Changes to EPLI Employment Practices Liability Insurance California LA Labor & Wage Violations Report

Employment Practice Liability Insurance (EPL) provides protection for an employer against employee claims, former employee claims, or claims made by potential employees based on discrimination, wrongful termination, harassment, and other allegations. If you are a California employer, you should know that labor and wage violations are higher in Los Angeles, CA than in any other major cities nationally. You should also know that getting insurance to protect your company or firm may soon be much more difficult.

Today’s EPL policy may no longer be available in Southern California, as well as other regions. This news follows the disturbing report issued by UCLA’s Institute for Research on Labor and Employment that found a shocking “9 out of 10 workers in Los Angeles County experienced wage theft and 80 percent did not receive legally mandated overtime”. The same report showed that “Los Angeles workers were more likely to suffer wage and labor violations than those in New York or Chicago”.

In light of this report, it is expected that many insurers will take aggressive steps to reduce their exposure in Southern California or risk an avalanche of losses. Failure to protect themselves would force insurers to face complete withdrawal from this essential venue.

• The first signs of restriction will be the elimination of Wage and Hourly coverage; a key coverage enhancement available in most policies that provides coverage for the very violations noted above.

• Expect the “Full Prior Acts” coverage term to be replaced by a strict Retro Date Inception (RDI) for first time policyholders, as insurers will look to favor their current policyholders over the “late comers”.

• New applicants for coverage will be forced to deal with stringent underwriting standards and may not be able to secure coverage at any cost (much like homeowners trying to re-finance their mortgage).

• Immediately following a series of coverage/underwriting restrictions, increases in retentions and premiums are sure to follow.

The bottom line is this: the signals for an extremely difficult EPL market are out there and firms that do not secure coverage IMMEDIATELY may be left out in the cold when they need the coverage the most. Since EPL is tied closely with Directors and Officers Liability, the impact on the EPL coverage line will undoubtedly affect D and O as well. So if you do not secure these coverages in the next 60 days, your options will not resemble what they could have today.

HCP National Insurance is an EPLI (Employment practices brokerage) company, who works with Rubicon Insurance Services – our affiliate and author of this blog. HCP National Insurance is not a law firm, but an Employment Practices Liability Insurance, Directors and Omissions, and Errors and Omissions insurance brokerage whose home office is in Aliso Viejo, CA.

NOTE THE ABOVE IS A GENERAL DISCUSSION ABOUT HOW COVERAGES MAY WORK. YOUR INSURANCE POLICY AND ALL ADDENDUM ARE THE ONLY AUTHORITY OF HOW YOUR COVERAGE WORKS. DO NOT RELY ON THIS ARTICLE AS AN EXPLANATION OF YOUR COVERAGE. HAVE YOUR ATTORNEY REVIEW YOUR ENTIRE POLICY WITH YOU TO DETERMINE WHAT IS AND ISN’T COVERED.

Shopping for any sort of insurance is daunting work, especially Medical Malpractice insurance. You should start about 90 days prior to renewal. Below is a nine step process to achieving the best deal for your coverage.

1. Assemble a list of all your insurance companies for the past 10 years with dates of coverage and policy numbers so your broker can obtain your loss runs (history of loss/claims), which normally should be requested within 60 days of your renewal (anything older may not be acceptable to the insurer).

2. Make copies of your licenses, update your CV, and assemble your letter head and any marketing pieces. The CV is important, since a potential insurer wants to see that you have adequate training. The letterhead, website and any marketing pieces are there for the underwriter to see if you are advertising services that may not be apparent on your application.

3. Write narratives on all claims for the past 10 years, as well as any medical board issues, if applicable. This is your opportunity to give your brief version of the events that occurred. Be concise and brief.

4. Your broker should give you one application, which he/she will use for your renewal and to shop for your coverage. Take your time filling this out, pay attention to the procedure list and mark all procedures that you perform (do not add things that you do not). Never delegate your application to your assistant. If you leave a procedure off in the application or there is a material misrepresentation, though unintentional, the insurer can deny your claims. Also, do not leave any blanks on your application rather add NA if something does not apply.

5. Your broker will send you letters to sign, which will be addressed to your former and current insurer(s) for the past 10 years. List your policy number, sign, and send this back to your broker first thing, prior to finishing your application since obtaining the loss runs can take some time. The purpose of loss runs is that the insurer wants third party confirmation on your losses.

6. Once you get your renewal and other quotes, read them carefully and ask lots of questions. Also, check your retroactive date to make sure it matches your current policy. Some people miss this and stare at a cheap price, while ignoring the terms of the quote. If you lose coverage to save money, you are not saving much.

7. If you are in the non standard market, a market reserved for doctors with malpractice claims, you will want to review premium finance options. The interest rate should be lower than a credit card. If it is not, start asking questions. Also, the norm is that you pay 25% as a down payment and finance the rest over nine
payments. Ask your broker for a 10 payment plan. Most finance companies will do this as a favor to the broker.

8. Send your down payment right away to your broker, and make sure you have the funds in the bank. If you are late, the insurer may pull the quote. The broker will not bind coverage without the down payment, because the insurance company can require the broker to pay it. If this happens, then your policy will not be activated.

9. Pay your premium early. Don’t ever be late. This is the one bill to never float. The insurance company can cancel and refuse to reinstate you for coverage. May sure your book keeper knows to pay this bill first and foremost.

HCP National is not a law firm and does not provide legal advice. We are a medical malpractice insurance broker and risk manager.

The old adage holds true: a person who represents himself/herself in a legal battle has a fool for a client. The same applies to medical malpractice insurance. Unless you want to spend years learning insurance brokering, it is best to consult an expert malpractice broker. The brokers are paid the same commission, which is typically 10% (in some cases 15% to 20%). This is built into the price of the insurance, thus it costs you nothing directly. Also, if you go directly to the insurer, skipping the broker, the insurer will not reduce the premium by the broker commission since it is built into the price. Again, having a broker will not cost you anything.

A good broker also can shop your insurance to make sure you have the best deal. They can be an advocate with your insurer if you have issues with them. They also can explain how your coverage works.

The challenge is how to find an expert broker in medical malpractice insurance in the California market. You need to find someone who is ethical and will look out for your interests. I wish a prospect for insurance could sit in our office for a week and see how hard all of us work to do the right thing, because there are many competitors who do not.

Finding a good broker:

• Ask a colleague who he/she uses

• Respond to a mailer asking the company for the name and number of their Norcal or Medical Protective representative. Call the company marketing representatives at Norcal and Medical Protective to confirm that the company is appointed with both insurers. This is a good indication that the broker does a lot of medical malpractice work and that they have been vetted by these insurers.

Note: I do not mention The Doctors Company (TDC); since they appoint very few agents and those they do appoint are often direct writers (can only place with TDC). So the fact that the agent does not have an appointment with the TDC does not indicate that he/she is not an expert in medical malpractice. Also, a non appointed broker can give you a TDC quote through an intermediary.

• Once you have spoken with Medical Protective and Norcal, ask the broker how many clients he/she has currently. You want someone with 50 or more clients, which indicates his/her expertise. Then ask for access to a list of all his/her insurers that he/she can go to on your behalf.

How do I know my broker is doing the right thing by me?

• If you are in the standard market (TDC, Norcal and Med Pro), you have the cheapest deals. These standard insurers are the lowest cost insurers and have the best terms, so in most cases there is no reason for the broker to shop for your insurance coverage since you have the best deal. If you are in the non standard insurance market, then your broker should shop for your insurance coverage every year, as well as try to help you re-apply into the standard market with the hope that it will accept you.

• Assuming you are in the expensive, non-standard market, you want your broker to go to at least 5 to 8 insurers. You want a list of the responses and quotes if applicable. Also, if you want proof of inquiries, ask for evidence like emails or letters the broker received from the underwriter or intermediary.

• Check all quotes to ensure your specialty is listed and your retro date is included. Sometimes underhanded sales people will sell coverage with no retro date. We had a client who left us for a cheaper deal, which he received as a result of his new broker dropping his retro back to 2004. Any person who was harmed prior to the effective date of the doctor’s cheaper policy can sue the doctor today for a past event, and the doctor will not be covered.

• Look at the fees that you are charged. Brokers are permitted to charge fees, but they must identify them as a broker fees. Most range from $350 to $500. There is a broker who we have encountered, who charges not only the usual fee, but also numerous other fees calling them processing fees, policy fees et al. Inquire about these fees and if the broker does not give you valid reasons for the charges, find a new broker. This broker received the normal 10% commission plus broker fees disguised as something else, running away with 30%-50% on a deal which is obscene and disgraceful to our profession.

• Watch out for brokers offering Risk Retention Groups (RRG’s). These are deals where you are part of a self insured deal. They will say they have reinsurance and other items of security. But in reality if they run into financial problems they can come back and ask for more money, more than the premium that you paid, and you have to pay as much as they need. We had a client who joined RRG’s, before coming to us, who went bankrupt and had to pay over $250,000, including legal fees, to pay what he owed the RRG. If you come across brokers who offer this option and do not tell you the truth about the downside of an RRG – RUN! Buy from a real insurance company where you pay your premiums and that is all you owe.

Do I need more than one broker?

• If the above criteria are met, then no you do not need more than one broker. Allow the person, who is doing the right thing to do his/her job and you will develop a relationship with that broker. If he/she does not meet these criteria, then find a new broker. If you want more than one broker to bid for your insurance, then choose two. Have this outside broker shop 30 days prior to your renewal date and not any sooner. If your current broker is truly shopping your insurance, then he/she should have started 30 days prior to your renewal date. The insurance companies release quotes to the first person who submits his/her risk to them. Those who come later are denied access. If your broker is doing his/her job, this outside broker should be denied a quote. When this happens the outside broker may call you asking for a broker of record letter, which is a signed document from the insured stating that a broker or agent is representing the insured. Do not grant this! Conversely, if the current broker finds he cannot access all his insurers that he/she went to, and if he/she comes asking for a broker of record letter, do not grant this either! If your current broker did his/her job properly, then he/she should have submitted your risk to all the insurers prior to the 30 days. You may also receive a call by either broker saying that it’s bad to have another broker (all sales talk). You will get calls saying, “I am blocked” (not a lack of fiber). It means your current broker or the outside one did the job properly, therefore do not undermine him/her by issuing a broker of record letter.

• If a broker brings you his/her bid that he/she put hours of work into obtaining without any compensation (since brokers do not get paid till they get your order to place the coverage), then please do not give his/her quote to someone else. This is not a good business practice, nor is it ethical. We all have families to support and businesses to run. This is a small market thus you will get a bad reputation for doing this, and no reputable brokers will work with you again.

HCP National is not a law firm and does not provide legal advice. We are a medical malpractice insurance broker and risk manager.

Occurrence Medical Malpractice Insurance

An occurrence malpractice insurance policy covers any claims that occur during any policy year. The only event where occurrence coverage will apply is when the incident occurred during the policy year.

Claims Made Medical Malpractice Insurance

A claims made policy covers any claims brought during the claims made policy period. There are two events for claims made medical malpractice coverage to apply. The incident must have occurred during the policy year and it must be reported during the policy year.

The average time to report a medical malpractice claim is approximately one to two years, and a tail is required, or reporting endorsement is to be purchased to provide coverage for claims which have occurred but are not yet reported if the insured is non-renewed or decides to change carriers.

(Note: This is not meant to be legal advice; we are not a law firm, but we are HCP National is a medical malpractice insurance brokerage in Orange County CA.)