Your Guide to Choosing the Right Malpractice Insurance

Appropriate malpractice coverage is a must-have for any CRNA. That’s why we’ve put together this guide to help you as you choose the right malpractice insurance.

You should understand the basics of malpractice insurance to make the best decision for you and your career. This guide will help you understand why CRNAs need malpractice insurance and how to choose the right malpractice insurance provider for your needs.

If you’re just starting as an employee with a hospital, group, or facility, you may think you don’t really have to know much about malpractice insurance. Your malpractice insurance is most likely paid for by the employer, which has already negotiated the policy details with the chosen carrier.

So, what’s there for you to know?

As it turns out, plenty – which many CRNAs have found out the hard way. It’s so important to make sure you understand your policy and, if necessary, get the appropriate supplemental coverage. Whether you’re full-time, part-time, or moonlighting you can’t assume your employer coverage will be enough. While many employers offer fantastic malpractice coverage, some don’t. It’s up to you to make sure you really understand the policy to determine if you should seek outside supplemental coverage.

What is Malpractice Insurance?

CRNA medical malpractice insurance is a professional liability insurance that arises from allegations of neglect or omission that result in the death or significant injury of a patient. Medical liability requirements vary from state to state, but are required in almost all medical systems and states as a requirement of practice and licensure.

Malpractice insurance is available through different sources, including insurance carriers, medical risk groups, professional organizations, and larger institutions that self-insure.

Both group and individual plans are available for independent and small practices. For employed CRNAs, medical liability coverage is often offered by the hospital or health system that employs them.

However, CRNAs are recommended to have their own supplemental insurance so their best interests are represented. The amount and type of insurance you may need will vary according to your various needs, including the state’s malpractice minimum requirements and personal asset protection that will vary according to your unique circumstances.

How Does Malpractice Insurance Work?

Medical malpractice insurance coverage should be obtained by your entity, your employees, and yourself. Coverage is needed for you as a CRNA because you are rendering professional services to patients — which carries risk. Individual coverage for a CRNA is available for an additional premium to keep your professional and personal assets protected in the event of a lawsuit.

Malpractice insurance works by paying a premium to protect yourself from lawsuits. It protects you from medical malpractice claims, which can occur when a healthcare professional, hospital, CRNA or other professional commits an omission or negligent act that causes injury or death to a patient under your care. The negligence may be a result of errors in diagnosis, treatment, health management, or aftercare. Of course, patients can file lawsuits even when nothing goes wrong. That’s why the good practice of medicine is protected by your malpractice insurance.

To be considered medical malpractice (that your insurance can cover), the claim must have:

A violation of the standard of medical care.

There are medical standards that are known and recognized as acceptable medical treatment. A patient has the right to expect that healthcare professionals, including CRNA deliver care consistent with the standard of care. If this standard hasn’t been met, then negligence or omission is established.

An injury or death was caused as a result of negligence.

For medical malpractice to occur, it’s not enough to establish that the standard of care was not upheld. The patient must have an injury or death that would not have occurred had it not been for the negligence. An unfavorable outcome alone isn’t considered malpractice.

The injury resulted in serious damage.

Medical malpractice lawsuits are difficult to prove, expensive to litigate, and require testimony of medical experts. For a case to go forward, the patient has to show that there was significant damage from the injury received as a result of omission or medical negligence. The patient must show the injury resulted in pain, suffering and hardship, disability, loss of income, significant medical bills, and even death. [4] [5]

Because litigation can be so expensive, it’s essential to make sure you choose malpractice insurance that can cover the high cost of such a case. Hospitals have been known to look out for themselves, so supplemental malpractice insurance is highly recommended for CRNAs.

When a case is brought against you, you’ll have to file a claim with your malpractice company. It's important to make sure that legal fees are covered by your malpractice insurance. In most medical malpractice cases, court judgments or settlements will be paid by the company, so it's important to make sure that your liability insurance policy limits are high enough to cover the cost.

If a settlement goes over the insurance liability limits, the CRNA will probably be responsible for the rest of the settlement or judgement. That's why it's so important to choose your medical malpractice insurance coverage wisely and have supplemental coverage to protect yourself. A large judgement could ruin your career and your financial situation.

What are the two types of malpractice insurance for nurse practitioners?

There are two kinds of medical malpractice insurance policies: Claims-made and Occurrence.

Claims-made Policies

This is a policy that only covers you for the incident if you are still insured. Coverage is triggered based on when the claim is made. And the current policy limits are used to cover any claims made during that policy year. At the end of your policy year, your limits expire.

This means that Claims-made policies don’t provide coverage once the policy is cancelled upon retirement, death, or disability — leaving a “tail” of exposure behind. To cover this exposure, Claims-made policies require that tail coverage be purchased after the policy ends.

Tail coverage can be pretty expensive. The premium is usually two times the amount of the annual premium cost and is assessed as a one-time fee rather than making payments. Tail coverage is critical when you’ve been covered by the policy but are retiring, moving to a new position, or changing carriers to ensure you are covered during past incidents. We go over this in more detail below!

Occurrence Policies

Occurrence policies cover any claim for an event that occurred during the coverage period, even if a claim is filed after the policy ends. This type of coverage doesn’t require tail coverage. This insurance is usually more expensive in the beginning, but ends up saving you money on tail insurance and giving you additional peace of mind, as well as more reliable coverage, long after the insurance policy ends (for the period that you had the insurance).

Do you need to purchase tail coverage?

If you end up cancelling a Claims-made insurance policy and your new insurance policy doesn’t include prior acts coverage, you will definitely need to purchase tail coverage to ensure you are covered for past incidents, should they arise. Some malpractice plans offer protection for prior act coverage, but many do not.

If you move or practice in a different state, you’ll want to make sure your malpractice plan covers events that occurred in a different state. So even if the insurance policy does cover prior acts but doesn’t include your old state, you’ll need to get tail coverage.

Keep in mind that you will have to do research on the state that you practice in. There are a few states that require medical providers such as CRNAs to carry tail coverage. You could risk your license being suspended should you not maintain this coverage, so it’s important to do your research.

How much does tail coverage actually cost?

Tail coverage can end up costing quite a lot of money. It can cost up to 350% of the cost of your current malpractice premium. Because they are so costly, there are a lot of insurers that have begun offering stand-alone tail coverage. These are less expensive, but can cost you in the long run since there is less coverage.

The most important thing to consider when thinking about tail coverage is planning ahead for your situation. If you know you are close to retirement or leaving practice, you could cut out-of-pocket costs after retirement by asking that your employer include tail coverage as part of your benefits package.

When you go with AANA Insurance Services you get Occurrence coverage: No need to buy a "tail"

Occurrence Coverage:

• Policy limits never expire
• Higher premiums, but can cost less overall because there’s no need to buy tail
• Eliminates the need to buy a tail
• Claims are covered for the years you had the policy, even after the policy ends

Claims-Made Coverage

• Policy limits expire at the end of every policy term
• Lower premium, but can cost more overall because you may need to buy tail coverage
• Tail coverage must be purchased, often costing more than Occurrence
• Claims are only covered during an active policy period (unless tail coverage is purchased)

What is CRNA Malpractice Insurance?

Because CRNAs play a critical role in patient treatment, they are highly vulnerable to the threat of malpractice lawsuits. While your employer may offer malpractice insurance, they do not always have your best interests in mind. Remember – they have the interest of the practice or hospital in mind over yours. In fact, your employer can even settle a claim on your behalf without your knowledge!

This cannot be overstated: if you find yourself facing the unfortunate experience of a malpractice suit, you will be glad that you have an insurance provider that places your interests above the hospital or practice for which you work. Instead, it’s like having someone work for you – someone that will go to bat with your best interest in mind.

It’s easy to imagine that a malpractice lawsuit will not happen to you. It’s even easier to forget that your employment, livelihood, and personal assets can be at risk if you’re involved. Don’t make the mistake of believing and trusting that the insurance your employer provides will protect you. Instead, you should protect yourself with supplemental coverage if you determine the insurance to be inadequate.

AANA Insurance Services has a policy to supplement the coverage you already have from your employer. There are a ton of benefits to such coverage including:

• Unlimited defense costs
• Pure consent to settle — you have the final say in how a claim is handled
• An attorney that is dedicated to representing your interests, not your employers
• Occurrence coverage that doesn't require you to buy tail coverage

How is Malpractice Insurance Priced?

There are a lot of factors that go into consideration to determine malpractice insurance requirements, premiums, and conditions.

Once the base rate of insurance is determined, the underwriter of the policy may apply debits and/or credits to modify the premium based on several different factors, including:

• Number of years in practice
• Claim history
• Board certification
• Full- or part-time status
• Affiliation with associations

Experience rating allows the underwriter to give a more accurate premium that can often save money based on claim history. There are other additional factors that can influence the cost of malpractice insurance premiums.

What Factors Influence the Cost of Malpractice Insurance Premiums?

To determine the base rate (before debits and credits), malpractice insurance carriers generally look at the following information:

Location

The location you practice in will have an effect on the premium of your malpractice insurance.

Insurance carriers use rating territories based on counties, states, or regions to price coverage based on claim experience in that location. For instance, larger metropolitan areas typically experience a higher claims volume than rural areas.

Policy Type

Occurrence and Claims-made policies are priced differently, so your rate will depend on the policy type you select.

Limits

The amount of coverage that you require will affect the cost of the policy. Typically the higher the limits, the higher the premium. You’ll need to decide the amount of limits you want to carry based on the amount of risk you’re comfortable taking on. However, too much insurance can also impact you negatively. It’s best to work with a trusted insurance partner, like AANA Insurance services, who will consult with you to better understand your needs and determine the appropriate limits for your situation.

Effective Date

Rates can fluctuate from year to year. The start date of coverage can affect the price.

What does Malpractice Insurance Cover?

Medical malpractice insurance is for legal claims that arise from allegations of malpractice, medical negligence, and medical omission. This insurance can help to cover various costs, including:

• Defense fees
• Expert witnesses
• Legal fees
• Settlement costs
• Judgement costs

Medical malpractice will protect and cover you up to your policy limit. Should the costs go over the limit of the policy, you will be responsible for coverage, which is important to keep in mind. AANA pays for defense costs outside of the policy limit, which can help keep you protected in the event of a lawsuit.

How Much Insurance Should You Carry?

The dollar amount of liability coverage a CRNA should carry depends on several factors. This includes the type and location of the practice, group, entity, or individual. Each state follows its own regulations when it comes to medical malpractice. Standard policy coverage options typically include $1M per claim and $3M annually.

Therefore, it’s hard to know the precise amount of coverage as it will depend on your state laws, the assets you hold, affordability of coverage, and the amount of risk you’re comfortable with. You can easily get a quote and recommendations about how much insurance you should carry from potential providers, including AANA Insurance Services.

What Happens When I Need to Use Coverage?

If a patient makes a claim against you alleging medical malpractice, you’ll have to file a claim and get in contact with your insurance provider immediately. Your agent will be able to give you the most accurate information about your plan, options, and coverage. You’ll start by filing a claim, and then communication between all parties, including the CRNA, insurance companies, patients, and lawyers will begin. A settlement may occur, or if the resolution of a claim doesn’t occur, you’ll have to go to trial. Having a strong insurer by your side for the lawsuit will make all the difference to your reputation.

Things To Keep in Mind When Considering Your Malpractice Insurance

You should consider several things when determining what kind of insurance you want, and who should provide your malpractice insurance. These include not relying on the insurance provided by your healthcare facility, assuming you’ll never be sued, and knowing the common errors that lead to malpractice lawsuits in the first place. Knowing these things will help you protect yourself and your career to mitigate risk and help you choose the best carrier.

Don’t Rely Solely on The Liability Insurance Provided by Your Healthcare Workplace

Some CRNAs have hospitals and facilities that take care of their professional insurance, and even enjoy premium covers. While this is helpful, it’s important to know that the organization may not have your best interests in mind when push comes to shove.

Having your own CRNA malpractice insurance means that you’ll always be protected so long as the policy is active. You won’t lose insurance simply because you changed positions, workplaces, or any other factors.

Don’t Assume that You Won’t be Sued for Medical Malpractice

You’re a professional and work your hardest for the safety and wellbeing of your patients. That doesn’t mean that you won’t eventually be sued for malpractice. Even highly trained and experienced CRNAs are susceptible to lawsuits stemming from error, omission, or neglect. Lawsuits can even be filed when you’ve done nothing wrong.

CRICO, the risk management team at Harvard Medical Institutions, released its CBS 2018 Benchmarking Report, which analyzed about 60,000 medical professional liability cases from 2007-2016. The report found that nursing professionals were named as defendants in 14% of all malpractice cases. That may seem like a small amount, but it’s one that continues to grow over time. Experts believe that the number will continue to grow as the number of claims and lawsuits surrounding malpractice grow.

As such, the wisest choice a CRNA can make is to get their own medical malpractice insurance. Getting coverage means that you will be safeguarded in the event of a lawsuit or allegation against you.

Understand the Most Common Errors that May Lead to a Malpractice Allegation

To protect yourself from malpractice in the first place, you should know the common errors that CRNAs make that can lead to injury or death. This will not only protect yourself, but your patients.

• Failure to review the patient's full medical history before making decisions or administering care
• Prolonged sedation that leads to complications
• Errors in dosage
• Errors in communication
• Use of faulty or defective equipment when administering anesthesia
• Failure to comply with standards of care

As a CRNA, you’ve completed rigorous education and training. However, it’s important to stay up to date on best practices, and always provide the highest standard of care to avoid any errors. Despite your best efforts, errors may happen, and that’s why it is so important to choose the right malpractice insurance and carrier.

Things to Consider When Choosing a Medical Malpractice Insurer

It’s critical that you select an insurance company that has the financial strength to survive in the long term. After all, you wouldn’t want to have to file a claim only to find out the company went belly-up and you have no one to protect you financially. Always ask about a potential insurance company’s fiscal strength and rating.

The oldest financial rating system is the A.M. Best Rating. The insurer you go with should at least have an A- rating. The A.M. Best Company is the absolute leader in determining financial strength. The insurance company AANA Insurance Services works with — MedPro Group — has an unsurpassed financial strength rating of A++, making it the perfect choice for CRNAs who are serious about protecting their reputations, careers, and finances.

One of the most important factors to consider when purchasing malpractice insurance is the experience of an agent. It is imperative to select an agent who specializes in CRNA malpractice insurance. Professional liability agents handle a large number of policies and this is useful when you're involved in an insurance claim or have an unusual coverage need.

You should work with an insurance agent who understands your needs as a provider.

The ideal agent should:

• Understand your specific requirements and assess your current coverage
• Educate you on the benefits and weaknesses of your current coverage and discuss options to better protect you
• Recommend the policy option that best fits your needs

It's easy to get a quote from AANA Insurance Services. No matter the practice setting, there is a coverage option to fit your needs.

Full-time or part-time. This coverage is for CRNAs who work more or less than 1,000 hours per year and need their own policy

Moonlighting. This coverage protects CRNAs who are covered in their primary position but need a separate policy for outside work.

Daily, Weekly, Monthly. This coverage makes sure that you are protected during shorter term assignments when you need your own policy.

Supplemental Insurance. This coverage supplements your employer coverage to protect your best interests.

CRNA Groups. This coverage is for CRNA corporate coverage and vicarious liability coverage.

Slot Policies. This insurance can cover up to 10 different CRNAs who work up to 2,000 hours per year.

Students. This coverage is for students who are in the clinical part of their education.

Nurse Anesthesia Educational Programs. This policy can cover CRNA students in clinicals and extend coverage to the school or facility that the student works at.

Regardless of the type of coverage, it’s important to know your malpractice insurance options. AANA Insurance Services makes it easy to do so. Our agency has over three decades of experience safeguarding CRNAs just like you.

Summary

Medical malpractice claims are common in a healthcare professional’s career. When your livelihood, reputation, and personal assets are on the line, you need to make sure that you have a proactive, specialized, strong insurance partner on your side to fight for your best interests.

It’s important to weigh a number of factors in your research. The policy premium must be thoughtfully considered against the service, protection, financial strength, and long-term stability of the insurance carrier. CRNAs should also review the carrier’s risk management services, standards, and experience in the field before making a decision.

Going with a company who has strong financial stability is important so that you can take comfort knowing that the provider pays their claims — including your own potential one. As a CRNA, you need to know that you’ll be protected. Administering anesthetics is extremely risky and is especially susceptible to medical malpractice claims.

Having an insurer like AANA Insurance Services can help protect you in your moment of need.

For over three decades, AANA Insurance Services has specialized in CRNA malpractice insurance. We’ve developed innovative and sustainable insurance products to meet the ongoing changes of the field and the needs of our members.

No other insurance agency offers a wider range of coverage options for CRNAs .