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What is Managed Care Professional Liability Insurance?
There has been a dramatic increase in liability claims against managed care organizations (MCO), and court decisions continue to erode traditional MCO protection. With this environment, it’s critical to have broad Managed Care coverage.

Managed Care professional liability insurance clients receive:

  • A quarterly newsletter that provides specific sections of information about risk exposures for MCOs.

  • A series of educational workbooks to use as templates for operational development, to proactively review areas of liability exposure, and to review or audit existing operations.

  • Periodic e-mails about managed care issues.

Coverage Available:

Directors and Officers (D&O) Coverage

  • Credential/peer review coverage

  • Option entity coverage

  • Employment Practices coverages

  • Non-cancellable policy, once the premium is paid

  • No medical malpractice exclusion

  • Credential/peer review coverage

  • Coverage for anticompetitive acts

  • Subsidiary coverage

  • Extended reporting period

Errors and Omissions (E&O) Coverage

  • Broad definition of covered managed care activities, including administration/management and marketing of health care plans, provider selection (peer review, credentialing, and contracting), utilization review, case management, disease management, claims administration, establishment of provider networks, and reviewing the quality of medical service or providing quality assurance

  • Coverage for medical malpractice allegations involving managed care activities

  • Specific coverage for medical information protection (including breach of confidentiality or improper disclosure)

  • No ERISA exclusion

  • No contract exclusion

  • Expanded definition of defense expenses (includes arbitration, mediation, and injunction)

  • Automatic coverage for 90 days in the event of a merger or acquisition

  • Vicarious liability coverage for sexual misconduct of contracted practitioners

  • Six-year “run-off” coverage at a percentage of existing premium if entity ceases business activities

Claim Example

Why it’s smart to have Managed Care Professional Liability insurance
A woman received health benefits through an HMO plan provided by her employer. When her son became ill, an HMO representative directed her to a hospital 42 miles away where the HMO received a discount, instead of a hospital 20 miles away that allowed no such discount. On the way to the hospital he went into cardiac arrest.

Although he survived, the resulting circulatory damage led to significant complications. The woman sued the HMO for negligence. Although the HMO testified the more distant hospital was a better pediatric facility, and the severe injuries were a result of the child’s illness rather than any delay in treatment, a jury awarded the plaintiff $45 million.