Practice Management

Hello, from the small group discussion held the other day, there were two topics I thought were worth mentioning to a larger audience.

Vicarious Liability for Telerad: I had asked around a bit, and I got different answers for vicarious liability for a group's telerad provider. For those who might not know what I'm talking about, vicarious liability is the liability that a group would potentially have from contracting with a telerad vendor whose physician experiences a malpractice issue. So even if that physician is covered by the telerad vendor's malpractice coverage, your group could also be sued (and likely would, as attorneys like to sue everyone tangential to a case) in the event that the group held the contract with the telerad vendor rather than the hospital, and their malpractice coverage would not cover your group's legal entity. Some said that it's not common to obtain. My current malpractice broker gave me a quote, but it was super high and quoted per telerad physician providing coverage because the "VL charge is a percentage based on the non-credited mature rate on the policy. It is not based on number of reads or number of hours." I was lucky in that I asked our telerad vendor if they would add our legal entity onto their malpractice COI as "an additional insured" and they agreed to do so, which I believe extends the vicarious liability coverage to our legal entity as well without extra cost to either our legal entity or the telerad vendor as I understand it (though I'll be the first to admit that I'm not an insurance expert and there could be some arcane / technical reason why that plan could potentially fail which I'm not aware of, though I don't believe that's the case). I wanted to expand on this discussion in case others either had solved it differently or perhaps hadn't considered the issue and perhaps ought to. Schaeffer told me that he remembered a Radiology Business article from earlier this year where a group was sued and held liable for a miss from their telerad vendor, so this would apply to that kind of situation. Sharing this for input/discussion with all of you.

Security Interest in AR: Credit to Ken Davis on this one. For those negotiating deals where the hospital would bill globally and would remit a fixed payment per wRVU to your group, this concept was an idea to establish primary lien position solely on the AR asset which your group is handing over to the hospital so that in the event they experience any financial difficulty, your group does not come behind other creditors/bondholders/etc. in line to get paid on the work they've performed for the hospital. Have others negotiated successfully for this? This was an idea I had not thought about, but it came up in the small group discussion around various consideration items for these kinds of negotiated deals. Passing this idea along in case it helps others.

Thanks Anthony,

I have been working on this very issue just this week. I had a meeting with our broker and underwriter yesterday who advised that the exposure is very low, but not zero. I like the solution of adding the group as an additional insured. 

I am wondering if any RBMA members have been brought into med mal cases via vicarious liability. Is the exposure as low as I think/hope? Has anyone had to use legal resources to invoke/defend the indemnification clause in their contract with a teleradiology provider?

Looking for real cases histories that hopefully have successful endings. 

Hello, from the small group discussion held the other day, there were two topics I thought were worth mentioning to a larger audience.

Vicarious Liability for Telerad: I had asked around a bit, and I got different answers for vicarious liability for a group's telerad provider. For those who might not know what I'm talking about, vicarious liability is the liability that a group would potentially have from contracting with a telerad vendor whose physician experiences a malpractice issue. So even if that physician is covered by the telerad vendor's malpractice coverage, your group could also be sued (and likely would, as attorneys like to sue everyone tangential to a case) in the event that the group held the contract with the telerad vendor rather than the hospital, and their malpractice coverage would not cover your group's legal entity. Some said that it's not common to obtain. My current malpractice broker gave me a quote, but it was super high and quoted per telerad physician providing coverage because the "VL charge is a percentage based on the non-credited mature rate on the policy. It is not based on number of reads or number of hours." I was lucky in that I asked our telerad vendor if they would add our legal entity onto their malpractice COI as "an additional insured" and they agreed to do so, which I believe extends the vicarious liability coverage to our legal entity as well without extra cost to either our legal entity or the telerad vendor as I understand it (though I'll be the first to admit that I'm not an insurance expert and there could be some arcane / technical reason why that plan could potentially fail which I'm not aware of, though I don't believe that's the case). I wanted to expand on this discussion in case others either had solved it differently or perhaps hadn't considered the issue and perhaps ought to. Schaeffer told me that he remembered a Radiology Business article from earlier this year where a group was sued and held liable for a miss from their telerad vendor, so this would apply to that kind of situation. Sharing this for input/discussion with all of you.

Security Interest in AR: Credit to Ken Davis on this one. For those negotiating deals where the hospital would bill globally and would remit a fixed payment per wRVU to your group, this concept was an idea to establish primary lien position solely on the AR asset which your group is handing over to the hospital so that in the event they experience any financial difficulty, your group does not come behind other creditors/bondholders/etc. in line to get paid on the work they've performed for the hospital. Have others negotiated successfully for this? This was an idea I had not thought about, but it came up in the small group discussion around various consideration items for these kinds of negotiated deals. Passing this idea along in case it helps others.

I would say that when we have a professional liability case involving one of our radiologists, the group gets named at least half the time.  That's vicarious liability as I understand it.

Perhaps I'm missing something, but I don't see how an independent contractor relationship with a teleradiology provider would change the risk to the group, or why it would make a significant difference in the cost of the group's professional liability policy unless volumes or other exposure change significantly.

One thing to think about if you're considering having the group added as an additional insured on the teleradiology provider's claims-made policy is arrangements for tail coverage for the group after the relationship ends.

Thanks Anthony,

I have been working on this very issue just this week. I had a meeting with our broker and underwriter yesterday who advised that the exposure is very low, but not zero. I like the solution of adding the group as an additional insured. 

I am wondering if any RBMA members have been brought into med mal cases via vicarious liability. Is the exposure as low as I think/hope? Has anyone had to use legal resources to invoke/defend the indemnification clause in their contract with a teleradiology provider?

Looking for real cases histories that hopefully have successful endings. 

Hello, from the small group discussion held the other day, there were two topics I thought were worth mentioning to a larger audience.

Vicarious Liability for Telerad: I had asked around a bit, and I got different answers for vicarious liability for a group's telerad provider. For those who might not know what I'm talking about, vicarious liability is the liability that a group would potentially have from contracting with a telerad vendor whose physician experiences a malpractice issue. So even if that physician is covered by the telerad vendor's malpractice coverage, your group could also be sued (and likely would, as attorneys like to sue everyone tangential to a case) in the event that the group held the contract with the telerad vendor rather than the hospital, and their malpractice coverage would not cover your group's legal entity. Some said that it's not common to obtain. My current malpractice broker gave me a quote, but it was super high and quoted per telerad physician providing coverage because the "VL charge is a percentage based on the non-credited mature rate on the policy. It is not based on number of reads or number of hours." I was lucky in that I asked our telerad vendor if they would add our legal entity onto their malpractice COI as "an additional insured" and they agreed to do so, which I believe extends the vicarious liability coverage to our legal entity as well without extra cost to either our legal entity or the telerad vendor as I understand it (though I'll be the first to admit that I'm not an insurance expert and there could be some arcane / technical reason why that plan could potentially fail which I'm not aware of, though I don't believe that's the case). I wanted to expand on this discussion in case others either had solved it differently or perhaps hadn't considered the issue and perhaps ought to. Schaeffer told me that he remembered a Radiology Business article from earlier this year where a group was sued and held liable for a miss from their telerad vendor, so this would apply to that kind of situation. Sharing this for input/discussion with all of you.

Security Interest in AR: Credit to Ken Davis on this one. For those negotiating deals where the hospital would bill globally and would remit a fixed payment per wRVU to your group, this concept was an idea to establish primary lien position solely on the AR asset which your group is handing over to the hospital so that in the event they experience any financial difficulty, your group does not come behind other creditors/bondholders/etc. in line to get paid on the work they've performed for the hospital. Have others negotiated successfully for this? This was an idea I had not thought about, but it came up in the small group discussion around various consideration items for these kinds of negotiated deals. Passing this idea along in case it helps others.

David, can you tease the last part out more from your response please? If the group is named as additional insured on the COI for vicarious liability purposes, and it incurs no cost itself for doing so, then what is the risk around tail coverage and whether or not the vendor ultimately secures it? I'm certainly no malpractice insurance expert, and I'm having trouble following what the risk might be to the group from this.

I would say that when we have a professional liability case involving one of our radiologists, the group gets named at least half the time.  That's vicarious liability as I understand it.

Perhaps I'm missing something, but I don't see how an independent contractor relationship with a teleradiology provider would change the risk to the group, or why it would make a significant difference in the cost of the group's professional liability policy unless volumes or other exposure change significantly.

One thing to think about if you're considering having the group added as an additional insured on the teleradiology provider's claims-made policy is arrangements for tail coverage for the group after the relationship ends.

Thanks Anthony,

I have been working on this very issue just this week. I had a meeting with our broker and underwriter yesterday who advised that the exposure is very low, but not zero. I like the solution of adding the group as an additional insured. 

I am wondering if any RBMA members have been brought into med mal cases via vicarious liability. Is the exposure as low as I think/hope? Has anyone had to use legal resources to invoke/defend the indemnification clause in their contract with a teleradiology provider?

Looking for real cases histories that hopefully have successful endings. 

Hello, from the small group discussion held the other day, there were two topics I thought were worth mentioning to a larger audience.

Vicarious Liability for Telerad: I had asked around a bit, and I got different answers for vicarious liability for a group's telerad provider. For those who might not know what I'm talking about, vicarious liability is the liability that a group would potentially have from contracting with a telerad vendor whose physician experiences a malpractice issue. So even if that physician is covered by the telerad vendor's malpractice coverage, your group could also be sued (and likely would, as attorneys like to sue everyone tangential to a case) in the event that the group held the contract with the telerad vendor rather than the hospital, and their malpractice coverage would not cover your group's legal entity. Some said that it's not common to obtain. My current malpractice broker gave me a quote, but it was super high and quoted per telerad physician providing coverage because the "VL charge is a percentage based on the non-credited mature rate on the policy. It is not based on number of reads or number of hours." I was lucky in that I asked our telerad vendor if they would add our legal entity onto their malpractice COI as "an additional insured" and they agreed to do so, which I believe extends the vicarious liability coverage to our legal entity as well without extra cost to either our legal entity or the telerad vendor as I understand it (though I'll be the first to admit that I'm not an insurance expert and there could be some arcane / technical reason why that plan could potentially fail which I'm not aware of, though I don't believe that's the case). I wanted to expand on this discussion in case others either had solved it differently or perhaps hadn't considered the issue and perhaps ought to. Schaeffer told me that he remembered a Radiology Business article from earlier this year where a group was sued and held liable for a miss from their telerad vendor, so this would apply to that kind of situation. Sharing this for input/discussion with all of you.

Security Interest in AR: Credit to Ken Davis on this one. For those negotiating deals where the hospital would bill globally and would remit a fixed payment per wRVU to your group, this concept was an idea to establish primary lien position solely on the AR asset which your group is handing over to the hospital so that in the event they experience any financial difficulty, your group does not come behind other creditors/bondholders/etc. in line to get paid on the work they've performed for the hospital. Have others negotiated successfully for this? This was an idea I had not thought about, but it came up in the small group discussion around various consideration items for these kinds of negotiated deals. Passing this idea along in case it helps others.

David, can you tease the last part out more from your response please? If the group is named as additional insured on the COI for vicarious liability purposes, and it incurs no cost itself for doing so, then what is the risk around tail coverage and whether or not the vendor ultimately secures it? I'm certainly no malpractice insurance expert, and I'm having trouble following what the risk might be to the group from this.

I would say that when we have a professional liability case involving one of our radiologists, the group gets named at least half the time.  That's vicarious liability as I understand it.

Perhaps I'm missing something, but I don't see how an independent contractor relationship with a teleradiology provider would change the risk to the group, or why it would make a significant difference in the cost of the group's professional liability policy unless volumes or other exposure change significantly.

One thing to think about if you're considering having the group added as an additional insured on the teleradiology provider's claims-made policy is arrangements for tail coverage for the group after the relationship ends.

Thanks Anthony,

I have been working on this very issue just this week. I had a meeting with our broker and underwriter yesterday who advised that the exposure is very low, but not zero. I like the solution of adding the group as an additional insured. 

I am wondering if any RBMA members have been brought into med mal cases via vicarious liability. Is the exposure as low as I think/hope? Has anyone had to use legal resources to invoke/defend the indemnification clause in their contract with a teleradiology provider?

Looking for real cases histories that hopefully have successful endings. 

Hello, from the small group discussion held the other day, there were two topics I thought were worth mentioning to a larger audience.

Vicarious Liability for Telerad: I had asked around a bit, and I got different answers for vicarious liability for a group's telerad provider. For those who might not know what I'm talking about, vicarious liability is the liability that a group would potentially have from contracting with a telerad vendor whose physician experiences a malpractice issue. So even if that physician is covered by the telerad vendor's malpractice coverage, your group could also be sued (and likely would, as attorneys like to sue everyone tangential to a case) in the event that the group held the contract with the telerad vendor rather than the hospital, and their malpractice coverage would not cover your group's legal entity. Some said that it's not common to obtain. My current malpractice broker gave me a quote, but it was super high and quoted per telerad physician providing coverage because the "VL charge is a percentage based on the non-credited mature rate on the policy. It is not based on number of reads or number of hours." I was lucky in that I asked our telerad vendor if they would add our legal entity onto their malpractice COI as "an additional insured" and they agreed to do so, which I believe extends the vicarious liability coverage to our legal entity as well without extra cost to either our legal entity or the telerad vendor as I understand it (though I'll be the first to admit that I'm not an insurance expert and there could be some arcane / technical reason why that plan could potentially fail which I'm not aware of, though I don't believe that's the case). I wanted to expand on this discussion in case others either had solved it differently or perhaps hadn't considered the issue and perhaps ought to. Schaeffer told me that he remembered a Radiology Business article from earlier this year where a group was sued and held liable for a miss from their telerad vendor, so this would apply to that kind of situation. Sharing this for input/discussion with all of you.

Security Interest in AR: Credit to Ken Davis on this one. For those negotiating deals where the hospital would bill globally and would remit a fixed payment per wRVU to your group, this concept was an idea to establish primary lien position solely on the AR asset which your group is handing over to the hospital so that in the event they experience any financial difficulty, your group does not come behind other creditors/bondholders/etc. in line to get paid on the work they've performed for the hospital. Have others negotiated successfully for this? This was an idea I had not thought about, but it came up in the small group discussion around various consideration items for these kinds of negotiated deals. Passing this idea along in case it helps others.

David, can you tease the last part out more from your response please? If the group is named as additional insured on the COI for vicarious liability purposes, and it incurs no cost itself for doing so, then what is the risk around tail coverage and whether or not the vendor ultimately secures it? I'm certainly no malpractice insurance expert, and I'm having trouble following what the risk might be to the group from this.

I would say that when we have a professional liability case involving one of our radiologists, the group gets named at least half the time.  That's vicarious liability as I understand it.

Perhaps I'm missing something, but I don't see how an independent contractor relationship with a teleradiology provider would change the risk to the group, or why it would make a significant difference in the cost of the group's professional liability policy unless volumes or other exposure change significantly.

One thing to think about if you're considering having the group added as an additional insured on the teleradiology provider's claims-made policy is arrangements for tail coverage for the group after the relationship ends.

Thanks Anthony,

I have been working on this very issue just this week. I had a meeting with our broker and underwriter yesterday who advised that the exposure is very low, but not zero. I like the solution of adding the group as an additional insured. 

I am wondering if any RBMA members have been brought into med mal cases via vicarious liability. Is the exposure as low as I think/hope? Has anyone had to use legal resources to invoke/defend the indemnification clause in their contract with a teleradiology provider?

Looking for real cases histories that hopefully have successful endings. 

Hello, from the small group discussion held the other day, there were two topics I thought were worth mentioning to a larger audience.

Vicarious Liability for Telerad: I had asked around a bit, and I got different answers for vicarious liability for a group's telerad provider. For those who might not know what I'm talking about, vicarious liability is the liability that a group would potentially have from contracting with a telerad vendor whose physician experiences a malpractice issue. So even if that physician is covered by the telerad vendor's malpractice coverage, your group could also be sued (and likely would, as attorneys like to sue everyone tangential to a case) in the event that the group held the contract with the telerad vendor rather than the hospital, and their malpractice coverage would not cover your group's legal entity. Some said that it's not common to obtain. My current malpractice broker gave me a quote, but it was super high and quoted per telerad physician providing coverage because the "VL charge is a percentage based on the non-credited mature rate on the policy. It is not based on number of reads or number of hours." I was lucky in that I asked our telerad vendor if they would add our legal entity onto their malpractice COI as "an additional insured" and they agreed to do so, which I believe extends the vicarious liability coverage to our legal entity as well without extra cost to either our legal entity or the telerad vendor as I understand it (though I'll be the first to admit that I'm not an insurance expert and there could be some arcane / technical reason why that plan could potentially fail which I'm not aware of, though I don't believe that's the case). I wanted to expand on this discussion in case others either had solved it differently or perhaps hadn't considered the issue and perhaps ought to. Schaeffer told me that he remembered a Radiology Business article from earlier this year where a group was sued and held liable for a miss from their telerad vendor, so this would apply to that kind of situation. Sharing this for input/discussion with all of you.

Security Interest in AR: Credit to Ken Davis on this one. For those negotiating deals where the hospital would bill globally and would remit a fixed payment per wRVU to your group, this concept was an idea to establish primary lien position solely on the AR asset which your group is handing over to the hospital so that in the event they experience any financial difficulty, your group does not come behind other creditors/bondholders/etc. in line to get paid on the work they've performed for the hospital. Have others negotiated successfully for this? This was an idea I had not thought about, but it came up in the small group discussion around various consideration items for these kinds of negotiated deals. Passing this idea along in case it helps others.