Physicians often serve as medical directors for healthcare facilities. However, the duties of a medical director, such as establishing practice protocols, credentialing and the hiring/firing of employees, are exposures typically not covered by an individual’s medical professional liability insurance policy. Physicians acting as medical directors are also open to liability if they are negligent in performing their duties, regardless of whether or not they treat patients. An example can be found in the case of Landry v. Leonard J. Chabert Med. Ctr., where the Court found that the physician breached his duty as medical director, which caused the patient’s chance of survival to decrease. Therefore, the physician was liable for the patient’s damages.
In order to protect yourself against these exposures, you should evaluate your insurance coverage. In some instances, Medical Director Insurance is included under the facility policy, but not always. If the facility policy does not include Medical Director Insurance or if the included coverage is not sufficient, additional coverage can be purchased separately through LAMMICO’s subsidiary agency, Elatas Risk Partners.
For LAMMICO-insured physicians and surgeons, please note that the LAMMICO Physicians & Surgeons policy excludes coverage for management or administrative duties performed as a medical director of any entity not insured under your policy. If you are serving as a medical director for a facility(s) that is not insured on your LAMMICO policy, we strongly recommend that you contact the facility(s) where you serve as a medical director to request coverage for your management and administrative duties.
If you are serving as a medical director for a LAMMICO-insured facility, the LAMMICO Facility policy includes coverage for management and administrative duties as a medical director for that facility. However, many other facility policies on the market do not provide this coverage. If you are serving as a medical director for a facility(s), we strongly recommend that you contact the facility(s) where you serve as a medical director to request coverage for your management and administrative duties.
Why is Medical Director Insurance needed?
- Protection of Assets: The primary role of insurance coverage is to protect physicians against financial harm associated with unexpected liability arising out of their work. Deciding to go without insurance coverage can place you in a position of having to use your assets to fund settlements, judgments and defense costs. Relying on the facility to adequately insure your activities as medical director may not achieve the type or amount of coverage you may require to adequately protect your assets.
- Uninterrupted Coverage: A physician-owned Medical Director Insurance policy is portable. In the event you change or add facilities, the coverage remains intact. Gaps in coverage could occur if you do not own the policy and are not offered the opportunity to purchase tail or extended reporting coverage from a facility when you leave the position. This allows portability and flexibility and can provide coverage for all facilities where you operate as a medical director.
For more information on options available for your medical director exposure through Elatas Risk Partners, contact Carly Thames at firstname.lastname@example.org or 225.906.2062.