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Who Moved The Cheese? You better check this out for peace of mind.

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Who Moved The Cheese?

Bob Blumm, MA, PA-C, DFAAPA

I can remember some of the cartoons that I watched in my youth that involved a cat or a mousetrap and a piece of aromatic cheese. The scent of the cheese permeated the walls and within a short period of time a little head exited and developed a strategy for capturing the cheese without losing its head. If the scenario was replayed hundreds of times there would be a Pavlov’s dog reaction and the same mouse or one of his relatives would be expecting an opportunity to win the prize. Why am I starting this brief article with such a silly introduction?

When a PA enters a clinical practice situation, it is because there was an interview and discussions took place from both parties on the expectation of an employee and an employer. General guidelines were set up and hopefully a contract was signed with a promissory sentence that included the PAs paid malpractice insurance. The PA walked away feeling really well at his/her accomplishment, the new salary, the benefits, vacation, CME funding and malpractice insurance. Time went on and the PA received the promised salary, the paid CME, the four weeks’ vacation, the sick time and even health insurance but never asked to have a copy of the malpractice policy to keep in a safe place and to read carefully. They never had the paperwork that said that they were, indeed, insured.

Two situations could have risen in the future. Situation number one was that the promised malpractice insurance was never purchased or was purchased the first year but there was a slight mistake, an omission, and there was no policy for the second year. It is only after a litigation that the PA became aware, went to their employer who could only regrettably throw his hands in the air out of frustration as no policy means you were working bareback, without liability insurance. I have won a reputation among my colleagues because I have guided them through some of these rough waters but I have encountered this more than a dozen times which means you may also encounter the same scenario.

Situation number two is becoming far more commonplace and comes like a thief in the night. The major hospital group in your vicinity takes your employer out to dinner and proposes a new opportunity. Instead of working the arduous hours and paying for an office, utilities and staff, they propose buying the practice, making the physician an associate professor and also making him an employee of the corporation. Initially, this is a great deal for the physician but what about his staff? What about the billers and secretaries and medical assistants and nurses and of course, the poor PA. They may all lose their jobs because dedication goes as far as the bottom line or the new employer of that PA has a different policy, a less substantial policy , with smaller limits and of course, like the old employer’s , it is a not an occurrence policy. This means when the PA leaves the employ of this new group, he/she pays a large tail as they had a Claims Made Policy. Wow, what a nightmare. Where is the cheese? Where are the old promises and the old malpractice and the security that the PA thought they had.

How do I change the nightmare into a sweet dream? I contemplate my situation and make a commitment, one which I should have made initially. I purchase a Personal Liability Insurance Policy with my personal name upon it and make this policy an Occurrence policy so that I will never be required to purchase a tail. One moment of courage, one application with a check and suddenly I re-discover where the cheese is! Start your career properly; don’t be fooled by promises that lack substance because within two years 80% of the physicians will be working for a hospital or health care corporation or institution. Protect yourself from the very start and pass your certification, find the specialty that suits you best and then regardless of a promise to have your policy under the hospital blanket, purchase your Personal Liability Insurance Policy!

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Newb in this arena and hoping someone might have a moment to educate me. 


What is the difference between an occurrence policy and a claims made policy? Also, why would a PA be required to pay for a tail?


Finally, does one buy a personal policy to cover all liability or for additional coverage above the employer's policy? In other words, can you negotiate to have the personal policy fees covered as part of your salary and avoid these issues altogether?

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Claims-Made is a policy stating you are only covered if the claim of malpractice is made while under that policy. In other words if it is active for that job at that time. So if you left for another job, the malpractice (without a tail) under a claims made would not cover you if someone made a claim after you left the job at which you saw the patient making the claim. A tail is designed to cover that period after you leave the job.


Occurance based means you are covered no matter when the claim is made by the policy that is in effect at the time you saw the patient. Even if you have long since left the job, you are covered. To my knowledge a tail is not needed for that.


The above is saying he took his own policy in the event that someone attempted to bait n switch the malpractice coverage. It is a viable if expensive (varyingly so) option for us.


Regarding being reimbursed, if your place of employment does not provide malpractice coverage then you could certainly request reimbursement during negotiations. Though most places provide some sort of coverage. I believe the OP was implying that he purchases a policy for a 'Peace of Mind' and 'just in case' scenario.


Hope that helps. If I screwed up somewhere please someone feel free to correct me.

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