This week we're digging into medical specialties and discussing how they are rated for malpractice insurance. While every carrier has their own underwriting guidelines and pricing criteria, most follow the same general methodology for rating. So how does your training, scope of practice, and procedure base really affect your rate?
No Surgery, Minor Surgery, Major Surgery
For many medical specialties, malpractice insurance pricing is broken into 3 levels: No Surgery, Minor Surgery, and Major Surgery. The provider's procedures and scope of practice will help the underwriter determine which classification best fits the risk. For example, a Dermatologist doing basic sutures, excisions, etc. would likely be rated as Dermatology – No Surgery, whereas a Dermatologist doing hair transplants or certain laser surgical procedures might be rated as Dermatology – Minor Surgery.
Some specialties only fall into one classification based on the nature of their work. Anesthesiology, for example, doesn’t have a “no/minor/major” price break. Radiology can have many different ratings, depending on the scope practice (diagnostic vs. interventional, oncology, mammography reads, etc.). Specialties such as Plastic Surgery, General Surgery, Cardiovascular Surgery, Orthopedic Surgery, OB/GYN, Neurosurgery, etc. are generally always rated as major surgery.
It is up to the provider to keep the carrier notified of any changes to their practice and any new procedures, however, many carriers will ask the insured to complete a renewal application or ask questions at renewal to make sure the current rating is still accurate.
Healthcare providers who want to change their specialty or scope of practice should check with their malpractice insurance agent to see how their coverage will potentially be impacted by such a change. Generally, small tweaks to the scope of practice will not affect pricing, but larger changes may. When providers move from a high-risk specialty to a lower-risk specialty (such as an OB/GYN who stops doing obstetrics and does only gynecology work going forward), there may be tail considerations or other costs that must be addressed. Providers who are winding down their practice before retirement should be mindful of this and talk to their agent to understand how coverage will be impacted going forward.
Questions to Ask Before Offering a New Service/Procedure
So you just finished an intensive training on a new, state-of-the-art medical procedure that you're excited to offer to your patients. You market the procedure on your website and social media and schedule your first few appointments - No worries, right? It might be time to pump the brakes. Before you launch into offering a new medical procedure (or before you even pay for the training) check to see how it might affect your malpractice insurance. Is it covered under your existing policy? If not, can it be added? Will it affect your rate? What happens if you offer the procedure for a few years and then stop doing it? These are just a few of the questions that you should talk to your malpractice insurance agent about before you begin offering a new service at your practice. Taking a little time to research up front will save you time, money, and stress down the road.