Why Medical Professionals Should Get Regulatory Compliance Insurance

On March 22^nd, 2021, our very own Skip Pleninger of the Medical Insurance Division was a panelist on the “Keeping it Straight with the Feds and the State: ASC Payment, Compliance, Risk Management, and Insurance” webinar by OOSS (Outpatient Ophthalmic Surgery Society). We can all agree that legal compliance and insurance are not necessarily riveting but it is extremely important for medical professionals to understand and keep tabs on. It was a short, one-hour webinar, packed with information. This blog will be covering what Skip discussed on the Regulatory Compliance Insurance side of things.

The most important topic Skip covered was where to look for the appropriate Regulatory Compliance Insurance coverage. One might think their commercial packages or BOP policies have Regulatory Compliance coverage. This is not the case. Some medical malpractice policies have a $25,000 extension but this mainly extends to areas related to Office of Professional Medical Misconduct or Licensure Issues and is defense only. Directors and Officers Liability coverages (D&O) may have some sublimits but these tend to have very high deductibles matching those sublimits which means you would be paying a lot of money out of pocket before the coverage steps in. The D&O extension is also a ‘defense only’ coverage and does not cover fines or penalties.

The most appropriate coverage to purchase is a stand-alone Regulatory Compliance Insurance Policy. Stand-alone policies cover fines and penalties, defense costs, and forensic auditor expenses which can be very costly. These policies usually have a $2,500 deductible and limits can range from $1,000,000 to $5,000,000. It is important to note that stand-alone policies do not cover settlement on restitution. In addition, coverage is afforded for RAC & Commercial Payor Audits, HIPAA, EMTALA, BOMER, Whistleblower and Self Disclosure issues.  Skip also noted that, like any insurance, it is valuable for you to compare coverages between companies. Not all companies are the same.

Lastly, Skip mentioned the growing need for Cyber Security and Breach coverage. In one of our previous blogs that you can read here, we discussed how cyber-attacks are still a growing risk for businesses. Cyber policies can give you coverage for IT forensics expenses due to a breach, lost business income, third-party liability, ransomware attacks, and more. Limits for a stand-alone Cyber policy can be from $1,000,000 to $5,000,000. Some commercial packages offer cyber extensions, but the limits are low, and the coverages might not be up to par with a stand-alone Cyber Security and Breach policy. 

For more information on Regulatory Compliance insurance contact Skip, his contact information can be found here. You can also read more about Regulatory Compliance on our website here. A recording of Skip’s portion can be viewed below. The entire webinar can be viewed on the OOSS website here.