By Dr. Jim Dahle, WCI FounderMedical malpractice is a subject that many doctors spend a lot of time thinking about. Today, let's discuss common questions asked about medical malpractice.
#1 What Is Medical Malpractice? Is Medical Malpractice a Civil or Criminal Case?
Malpractice is a civil tort, not a criminal act. That means you do not go to prison for malpractice. You simply become liable for the damages due to your negligence. Damages might include easily calculated costs like past medical care, more difficult to calculate costs like future medical care and future earnings, and impossible to calculate costs like “pain and suffering.” Due to the way damages are calculated, it is less costly to kill someone than disable them. It is also less costly to hurt an older person than a younger person and a lower-earning person than a higher-earning person. It might not be fair, but that's the way the world works.
What Constitutes Medical Malpractice?
Malpractice has four elements, and all four must be met for any given act to be malpractice.
- Duty
- Breach
- Causation
- Damages
The first is a duty to treat. This is usually the easiest for an attorney to prove. If someone came to your clinic or hospital to be seen by you and you saw them or should have seen them, this criteria has been met.
The second is a breach of the standard of care. The standard of care is what a similarly trained doctor would have done in a similar situation. This is where the expert witnesses come in with their opinions. Typically in a malpractice trial, the dueling expert witnesses try to convince the judge or jury of exactly what the standard of care would be. Naturally, this is a legal term (not a medical one), and its application to a given case can be argued about for days.
The third is causation. The breach that was committed must actually have caused subsequent harm. You can screw up all you like, but if your screwups never hurt anybody, it's not malpractice—even if something bad eventually happened to the patient. The breach must cause the damages for it to be malpractice. There is often room for significant disagreement in the courtroom on this aspect.
The fourth is damages. If there are no financial damages, there is no malpractice. It's not a crime; it's a civil tort. It's about money. If a doctor is proven to have committed malpractice, the doctor (or much more likely the doctor's insurance company) will write a check to the plaintiff or their family member.
What Is the Statute of Limitations on Medical Malpractice?
Every state has its own statute of limitation laws that limit the amount of time someone has to initiate a medical malpractice case. Most states set that time limit between 1-3 years with the clock starting on the date of injury. Most states have a provision for patients who don't discover that they were harmed right away called a “discovery” rule. These “discovery” exceptions typically extend the statute of limitations to the period of time that the person should know, or should reasonably know, that they were injured. Each state has its own rules, so take care to follow specific state laws.
#2 Why Do Patients Sue Doctors?
When asked why they sued their doctor, patients or family members usually give one or more of the following reasons:
- To prevent similar incidents in the future
- To know how and why the injury occurred
- For actual losses
- To hold those responsible accountable
Patients want greater honesty, an appreciation of the severity of the trauma they have suffered, and the assurance that lessons have been learned from their experience. However, in a well-run medical system, three of those four (as well as honesty, appreciation, and assurances) can occur without proceeding through the legal system. At the end of the day, there is no guarantee that even a successful malpractice settlement or suit will provide anything but some compensation for actual losses.
The outcome of a successful suit is a check. That's what you get. That's what it is really about, no matter what the attorneys say during the case. The attorneys certainly remember that, but the plaintiffs and the doctors too often forget, and it becomes much more of an emotional experience than the straightforward business transaction it really is.
More information here:
What Is Social Inflation, and How Does It Impact the Rising Costs of Medical Malpractice Insurance?
#3 Do I Have a Case for Medical Malpractice?
Most malpractice lawsuits don't go anywhere because no malpractice was committed. Of those that go to court, approximately 80% of them are won by the defendant. Before deciding to sue a doctor, ask yourself a few things:
- Did the doctor have a duty to treat me (or my family member)? The answer is probably yes.
- Did the doctor screw up? You may not be able to tell, but you will want to determine this relatively early in the case, certainly long before the doctor has any idea they are being sued.
- Did the doctor's mistake cause you (or your family member) any harm? Again, determine this before bringing suit.
- Are there any financial damages that you can expect to collect? Is there enough that one-third of them (that will be paid to the attorney) is likely to be at least $100,000 (the amount it will cost the attorney to do a full trial)?
- Is it going to be worth it to you to go through the process to get your share of that money?
If the answer to all of those questions is not yes, then skip the lawsuit. Otherwise, the basic process is to first meet with a personal injury attorney, preferably one with plenty of experience in medical malpractice. That consultation is usually free. A lot of the time, they can tell you within a half hour whether you have a reasonable case. They'll probably be taking it on contingency, so if they're not willing to take it, that tells you a lot about the merits of your case and the likely outcome. If they can't make $25,000+ out of a quick settlement or $100,000+ out of a full trial, they're not going to take your case.
Resist the urge to go to a less qualified attorney willing to take the case. Hiring a crummy attorney is not likely to improve your outcome.
How Does a Medical Malpractice Lawsuit Work?
If the attorney thinks you may have a case, the next step is to have the attorney's office request all the medical records and then pay another doctor to review them and give an opinion as to whether there was a breach that caused damages. If the opinion is positive, feel free to proceed (and you have probably just found your main expert witness). If the opinion is negative, resist the urge to shop it around to more doctors. Chances are if every doctor reviewing your case doesn't see obvious malpractice, you're probably not going to win.
In some states, your case will now go before a review board consisting of doctors, patient advocates, administrators, and others. While their opinion of the merits of the case is not always binding, it's a pretty bad sign if they don't think you have a case. If they do think you have a case, chances are you can now force the doctor's insurance company to pay you a settlement, get a big fat check, pay off the attorney, and go on with life. If you can't force a reasonable settlement, you can go to court and hope for the best.
Just realize the odds are against you once you get there. Most doctors are good people trying to do the best they can in difficult circumstances, and juries and judges tend to be sympathetic toward them.
#4 How to Prevent Medical Malpractice as a Doctor
Every doctor makes mistakes. They're all human, and some tiny percentage of those mistakes will hurt a patient. If you tell me you have never committed malpractice, I'll tell you that you're a liar. There is tons of malpractice out there. It is almost entirely unintentional, and the damages are usually relatively minor—such as a reaction to a medication, some additional pain or delay to diagnosis, or perhaps a second procedure to correct something that occurred in the first one. But the truth is that most lawsuits don't involve malpractice and most malpractice is never sued.
If you’re wondering how to prevent medical malpractice suits, do all you can to avoid mistakes. That means staying current in your knowledge and skills, only doing procedures you are good at, avoiding situations where you are undersupported, and avoiding situations where you are rushed or forced to work tired. Don't operate in the middle of the night or on Saturday afternoon with a crew you don't know well unless you must. Be conservative and first do no harm. When things are not going well, “load the boat” by getting additional specialists involved quickly. Do more extensive work-ups on repeat visits. Cross every t, dot every i, and pay attention to details.
Malpractice, however, is primarily a matter of exposure. The more patients you see, the more malpractice you are likely to commit. The harder it is to avoid mistakes in your specialty and the more bad things that can happen to patients in your specialty, the more malpractice you are likely to commit.
#5 Ways to Avoid Litigation and How to Prevent Medical Malpractice Suits
The obvious answer of “don't commit malpractice” is not as accurate as you might think. Many patients and family members don't even recognize when a mistake has been made, and since many of them have little in the way of damages, they don't matter much. As noted above, many patients and family members aren't as interested in the payout as you might think, given that's all they get at the end of a lawsuit. Many patients and family members sue because they don't like the doctor. Patients tend not to sue doctors they like. So, be likable.
Spend time with them. Listen to their concerns. Speak to as many members of the family as you can. Show them you care. This not only reduces risk but also improves patient care. Give clear instructions, both written and verbal. Use real translators liberally. Call patients back to check on them. When things are going badly, double down on all of your efforts. Don't start hiding from the patient and family members, even though that feels like the natural thing to do. Increase communication and compassion. When a mistake has been made, explain why and what you are doing to keep it from ever happening again. Make sure the only reason they ever have to sue you is to get money. Documenting well what you did and why seems to help, too.
More information here:
How Physicians Can Prevent Getting Sued
How to Survive a Medical Malpractice Lawsuit
#6 How to Protect Personal Assets from Malpractice Lawsuits
How can you be 100% sure you won't lose personal assets in a malpractice lawsuit? You can't. Next question?
Seriously, though, way too many doctors worry way too much about this. While you cannot be 100% sure, you can be 99.99% sure. It is possible to lose personal assets in a lawsuit, but it is so rare that it is the equivalent of winning the lottery. While some doctors have heard through the grapevine of someone who lost personal assets due to a malpractice lawsuit, almost no doctors, asset protection attorneys, or even personal injury attorneys personally know a doctor who has lost personal assets. Remember:
- The first line of defense in an asset protection situation is to not commit malpractice.
- The next, and main, line of defense is liability insurance.
- In the incredibly rare situation that you get beyond that, the next line of defense is your state's exemption laws, which typically include retirement accounts and may include a significant amount of home equity, cash value life insurance, annuities, HSAs, 529s, and personal assets.
Only after that do “exotic” asset protection schemes come into play, and in that situation, most of them don't work anyway (despite what the person who sold it to you for thousands of dollars told you). The best asset protection plans are straightforward and inexpensive, and they are done for non-asset protection reasons like tax reduction, business structuring, or estate planning.
#7 How Much Medical Malpractice Insurance Should a Doctor Buy?
Professional liability insurance, or medical malpractice insurance, protects physicians and dentists against the financial catastrophe of losing a lawsuit or having to settle a lawsuit due to committing medical malpractice. This is likely the most expensive insurance policy they will ever buy, and physicians in some locations and specialties have spent more than $100,000 a year on malpractice premiums alone. It is natural to wonder, “How much of this do I really need?” The answer, unfortunately, is not very clear cut.
The true answer is “enough.” You need to have enough of a benefit to pay for the costs of the defense, the cost of any settlement, and the cost of any final judgment. Since there is no way to know exactly what a future judgment could be, there is no way to know exactly how much insurance you need.
The usual recommendation on how much medical malpractice to buy is to carry the same amount as other doctors of the same specialty in your geographic area. That usually varies anywhere from a few hundred thousand to a couple of million dollars. Policies are usually described as $1 million/$3 million, where the first number applies to the amount per case and the second number is the total amount the insurance company will pay out per year.
There are generally no deductibles with malpractice insurance. While it would be nice to get a policy where the doctor pays the first $10,000 and the insurance company picks up the rest, that's not the way these policies are usually written. They generally pay from the first dollar and then cap the payout at a certain amount.
Whether you should buy more than the average doctor in your area is an open area of debate. Some malpractice attorneys (both on the plaintiff and the defense side) have told me no. Others have told me yes. There does not seem to be any consensus.
Many doctors worry a larger policy just makes them “deep pockets” and more likely to be sued. Legal experts seem to agree that is not really a concern. The key seems to be to have “enough” that a policy limits payout is enough to satisfy both the plaintiff and their attorney. They want to feel like they got “a lot” of money. One million dollars still seems to be “a lot” of money, so that is probably the most common amount carried by doctors.
#8 Where to Get Malpractice Insurance
If you’re wondering who sells malpractice insurance, most doctors luckily don't need to deal with this issue. Their malpractice provider is paid for and selected by their employer, or it has previously been selected by the partnership they join. Even in a locum tenens situation, a lot of times the locums company or the site you work at will provide it or has a recommendation of a company where you can purchase it. Even in independent contractor-type situations where a doctor is actually responsible for buying their own coverage, the doctor can simply ask what other doctors in that situation are doing and do the same.
But if you do need to shop for insurance, there are several large, well-regarded companies and at least a dozen other smaller companies out there.
- Risk Strategies
- Medpro
- Berkshire Hathaway (Medical Protective)
- The Doctor's Company
- CNA Insurance Group
- ProAssurance
- Coverys
How Much Does Malpractice Insurance Cost?
As far as I can tell, nobody rates them in any meaningful way that would assist you in choosing between them, so I would call up a few companies, get quotes, and ask them what distinguishes them from their peers. You can ask for anecdotes from other docs, but given how rare lawsuits are and how unwilling doctors are to talk about them, I wouldn't rely much on that. Risk Strategies is the only one affiliated with The White Coat Investor, but I have been covered by Medical Protective, COPIC, The Doctor's Company, and a regional mutually owned company at various times in my career. I would take the one that seems to provide the best service at a reasonable price (and the prices can vary widely). The best way to get a good price is to be in a large group of doctors buying it!
Remember the most important aspect of a policy, whether it is an occurrence policy or a claims-made policy. If you buy a claims-made policy, you will also need a “tail” to pay for any claims made after the term of the policy.
More information here:
What I Learned from Getting (Kind of) Sued
#9 Why Has the Price of Malpractice Insurance Been Falling?
Nobody is 100% sure. Some of it is likely competition between companies, but there is little doubt that doctors have gotten better at avoiding lawsuits. Treatments, procedures, medications, and imaging studies are getting better, and doctors have learned the situations that most often result in malpractice lawsuits in their specialties and take special care in those cases to practice and document well. In many states, measures have also been put into place to swing the pendulum a bit in the doctors' favor. These include:
- Caps on pain and suffering damages
- A higher standard to prove negligence
- Prelitigation panels
These tort reforms make it more difficult for patients to successfully sue doctors, and they make it so attorneys are less interested in pursuing borderline cases.
#10 What Support Is Available for a Doctor Being Sued?
Despite the fact that most lawsuits don't involve any malpractice, doctors are still often embarrassed about them. They also worry that somehow something they tell anyone but their attorney will become discoverable in court. So, they basically sink into isolation for 2-5 years when they receive a notice of claim.
While this doesn't make logical sense once you understand what I have written above, being sued is still an incredibly emotional experience. It might help a little to remember that you're essentially functioning as a defense witness for the insurance company, since we're really talking about their money and not yours. Mostly, doctors just need some education as they go through the process and some emotional support from therapists, coaches, and even other doctors who have been through it.
Read a good book about the process. Anonymous online physician forums can be a good place to find some empathy, but don't post anything about the case that could even possibly cause you to be identified. Have your attorney walk you through the case and what to expect early and often so there are no surprises. Then, try to move on with your personal and professional life. This is going to take at least a few months if not years. More support resources can be found at PhysicianLitigationStress.org.
Medical malpractice is, unfortunately, part of being a doctor. Protect yourself from it with good insurance and a reasonable asset protection plan. Protect your patients from it by becoming the best doctor you can and surrounding yourself with systems and people that can help you minimize mistakes and their effects. Most doctors will be sued once on average during their careers. Remember what it's about—money—and that this too shall pass. Show empathy to your colleagues dealing with a lawsuit—”but for the grace of God there go I.”
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What do you think? What tips do you have about avoiding malpractice, buying insurance, or dealing with the stress of a lawsuit?
[This updated post was originally published in 2021.]
Regarding bullet point #5, I remember a post here a few years back that reviewed some recent research that showed that “being nice” doesn’t make any difference; that the risk of litigation is simply proportional to one’s patient volume.
Yes, that was a recent article in Annals of Emergency Medicine arguing that. But overall the data is still mixed. I think being nice still matters; besides, it’s just the right thing to do.
Anecdotally I was taught one neurosurgeon with high malpractice allegations (perhaps not all of a level to reach to payout but still a burden to patient advocate and risk management in hospital) had lowered rates of this after the hospital got a kindly NP to follow him on rounds and be the sweetness light and more thorough counselor preop for him.
Regarding #7, ProAssurance sells policies with a deductible.
Interesting; thanks for sharing.
I won a malpractice lawsuit against a surgeon, and can share the view from that end.
My reason for suing was item #4. That surgeon significantly impacted my future health, and his neglect and carelessness put me and my family through hell for a year. In addition, I now have a medical condition that I will have to live with for the rest of my life. So yeah, I wanted that bastard to feel some of that pain. I didn’t need the money, and could have cared less how long the process took. (For me, longer was better. I was told later by my attorney that this made the negotiations much easier. Apparently people are often in a hurry to settle their cases, which gives the doctor’s counsel some leverage to drag things out. ) If I could somehow give this money back and not have had this issue happen, I’d take that trade in a heartbeat.
Timing you listed is about right. For me the total time between first contact with the lawyer and receiving the check was about 2 years . In my case, it took about a year for my attorney to do his pre-trial assessment of our claim. That was followed by a state-mandated 6-month “notice period” in which the opposing counsel is supposed to research the claim and provide a response, but in reality accomplished zilch other than chew up time. It then took about 4 months for the lawyers to negotiate a settlement and work out the details on getting the check. Settlement was at the surgeon’s insurance limits. I was told that my negotiations happened very quickly – the bulk of the negotiation was done in a single afternoon – due to the egregious nature of the surgical error that led to my injury. (Pro tip – when the nurses are uniformly telling you that you need to see a lawyer, it’s advice that should be heeded.)
On the “how to prevent it” bit – my view is that there should be a better way for patients to do research on their doctors prior to undergoing major treatment. I tried to “do my homework” prior to my surgery, but found that the info on doctors’ histories was pretty sparse. If that information was more readily available, I would have rejected the surgeon to which my health plan assigned me and I likely would have had a better outcome. Perhaps this is something that your community could better advocate for – seems like you would want to “out” bad doctors as they would reflect poorly on the large majority of you all that do genuinely good work.
Agree with your statement disputing the idea of higher insurance limits making you a “juicier target” in a lawsuit. A higher insurance limit would not have made me more likely to sue. I didn’t even know what the insurance limits were until after the lawsuit had been filed (it came out during discovery, it was one of the first things my attorney asked for). That said, I do agree that a low insurance limit would make a plaintiff more likely to sue a doctor personally. Again, I wanted someone to feel pain from the injury they caused me, and the settlement I received (7 figures, policy max) seemed as painful as I could reasonably make it legally. If it was too low I would have gone after him personally (legally).
One thing I was surprised at was how tilted the legal playing field was against doctors relative to other participants in the health system. In my case, we discovered serious issues with the credentialing practices at the hospital where my surgery occurred that led to this, as well as with the hiring practices in the physician group that hired this surgeon. We considered suing the hospital and also the physician medical group, but apparently both entities were legally structured in a way that prevented plaintiffs from ever recovering money from them in a lawsuit. So, the only person that could be made to feel the pain of a lawsuit was the surgeon, which is who we went after. Again, this may be an area where the physician community can help reform.
I am a doc and have been on the receiving end of a frivolous case, which was tossed. I’ve also served on pre-suit panels for cases and it’s a mix including real and avoidable harm. Yet I’ve never personally heard of a case based on anything as egregious as what you must have gone through. Yet, I occasionally see terrible care by docs (and hospitals) who never get sued. Would you mind sharing the nature of the malpractice by the surgeon?
I would love to read the actual details of the surgery and lawsuit, because I bet there is a whole lot more you are not telling us.
“His neglect and carelessness put me and my family through hell for a year.”
Well, here’s the flip side to that. YOU put him and his family through hell for YEARS.
And you probably affected how he will practice medicine on THOUSANDS of patients moving forward. When you do something like that, because you are angry and want to make someone feel whatever you are feeling, you are only diminishing the rest of the world. You are paying forward anger. So now that doc orders extra tests on everyone, extra defensive labs and imaging, for instance. Costs go up for everyone. Defensive healthcare drives up costs and wait times and drags down the whole health care system because of people like you who want their “fifteen minutes”. Their revenge. Their unearned paycheck. Or as a surgeon, he now only takes the most conservative cases, rejecting others. He helps a whole lot less people because he is now overly cautious. You have just hamstrung him and his ability to help people. Great job.
Let’s remember that’s what a DOCTOR is: he/she someone who has devoted THEIR LIFE to trying to help people.
Have you done that in any meaningful way? I kind of doubt you’re the kind of person who cares a whole lot about his fellow man, when you are using phrases like “I wanted him to feel the pain.”
There was NOTHING good about what you did. But there WAS likely a whole of BAD that came from it.
Hope you feel good about that paycheck (“you didn’t want”), and that sweet, sweet revenge for someone who was trying to help you.
Also, given your uses of phrases like “I wanted that bastard to feel some of that pain”, I have a tendency to not immediately associate you as the most impartial historian, and I almost bet whatever happened to you was within the predictable list of potential worst-case scenarios of whatever the surgery was… something I’m sure you signed consent for ahead of time.
But I’m sure you didn’t think that was a big deal.
So how about it? Without giving any personal details that would compromise anonymity, tell us the details of what really happened, so we can weigh in how much was actually the fault of the doctor whose life you destroyed, and how much was either your own fault through years of self-negligent, or a predictable but undesirable side-effect of the surgery.
I am a surgeon named in a lawsuit. The case involved an elderly person who was quite sick with sepsis. This patient had been transferred to our institution 3 days prior to my being asked to see her. I was on call for the weekend for acute care surgery. I saw her and recommended immediate abdominal surgery has she had clear-cut peritonitis and was mildly hypotensive, low urine output etc. At the time of surgery she was found to have stool and pus throughout her abdominal cavity obviously from a perforation that had happened days ago. Immediately after the surgery I discussed my findings with the family and that she would likely die from her illness.
Following the surgery she remained in our ICU, on a ventilator. She developed ongoing sepsis, multiple fistulas, open abdomen and eventually succumbed to her illness.
I was named in a lawsuit filed two years later by a well known plaintiff’s attorney. I was accused of all sorts of horrible things ie: failure to examine the patient properly, failure to do an adequate history, there was a long list of things none of which were true. Receiving the lawsuit in my office was the worst thing that had ever happened to me. Following that I started being very circumspect in receiving transfers from outlying hospitals, and even transferring patients out of our hospital (if I could — not always possible) that I thought needed emergency surgery and would likely have a bad outcome. This, even though I felt comfortable doing complicated abdominal surgery — I had been doing acute care surgery for many years. I had a hard time not thinking about it — it was always there. It carried over into my family life and essentially wrecked two years of living.
I couldn’t sleep for a long time, depression/anxiety. My relationship with my family was strained, and I considered seeing a therapist but never did. This went on for a year and a half. I began to hate work and practiced extremely defensive medicine. I decided to retire prematurely from my practice as I began to view patients as adversaries.
Because of Covid the case dragged on and nothing happened. Eventually the plaintiff’s expert, in deposition, admitted I did nothing wrong and that the other physicians on the case (who had not made the proper diagnosis when she was transferred) were the ones who were responsible. This was the same expert that previously has asserted I had committed malpractice and did not follow the standard of care. Still I was not dismissed for several months. I was relieved when I received the dismissal but wonder if the whole thing could have been avoided by a better system.
I’m so sorry you went through this. I hope as the dust settles and you are able to accept the fact that you did nothing wrong, that you’ll be able to get back into surgery. It sounds like you’re a good doc. I wish you the best.
When you mention, “retire prematurely” how early? How are things now? Did you start practicing again?
One thing that’s disturbing to me is that for the most part the goal of litigation from the lawyers is to pursue a winnable case irrespective how “deserving” the suit is. Our current med mal system does nothing to make care better. As a peds intensivist I’ve had a few brushes with malpractice but thankfully no successful suits.
What’s screwed up is that a child could die and the plaintiff will have no lawsuit since there’s not a lot of money to collect so a lawyer won’t take the case. If a child has a bad outcome but lives, this is the suit they want to pursue. The case never goes to trial since all parties know that if you put a disabled child on the stand the jury will feel like “someone” has to pay.
It’s interesting since on one hand we’re told to “chose wisely”, practice evidence based medicine, don’t over consult. However, the lawyers will tell you to consult everyone, do every test to protect yourself. Also, those of us who work with residents want to give the residents some autonomy to learn. However, anytime you give a trainee autonomy you’re taking a risk of a suit.
One thing I will say that helps is good documentation. If the documentation shows that you’re present, involved, making medical decisions in line with the standard of care, you’ll have a better shot.
The thing that drives people the craziest about the dumb system is being named AND THEN figuring out if a doctor should be – which should be legal malpractice. Guilty until proven innocent is unconstitutional, why can’t I sue a lawyer for frivolous naming of me? It costed me pain, suffering, and lawyer fees.
Then we have negligence. Let’s face it, patients are negligent to their bodies, they are the ones that are coming in for help. So as long as I’m not drugging them, stabbing them, or actively and purposely hurting them, how can I be negligent? Because you have outcome Z and then look back doesn’t mean anyone did anything wrong, unless they actually did.
Finally, “standard of care”. Apparently no one can agree on this, and they have to pay people to argue what it is, which means it is a crock of sht. So let’s stop calling it that.
Law and judges in on the extending and expanding or delaying cases, so everyone can make more money, is why the US is a joke of inefficiency, increasingly. The only answer I see is patients taking better care of themselves and physicians with the job of adjudicating real negligence in tribunals. This would be far more fair and less ridiculous.
Hello
I recently listened to one of your podcasts on malpractice. I think the best strategy starts with prevention. Statistically we all doomed to face one of these events at least in our lifetime. I want to practice only for 10 more years and then do doctors without borders
I had a few quick questions.
1) Is it wise to practice in states with a malpractice cap? This is what I have been doing.
2) Do I need to hire a personal attorney if I work for the federal government? What is the advantage here versus private practice?
3) Does locum tenens pose more of a risk for malpractice if you are practicing in a state with malpractice caps then regular practice? I found if you do locum tenens in a state without malpractice caps then you are putting yourself in a more risk position?
4) Do you know of any cases where doctors have lost all their personal wealth? I have a homestead exemption and most of my retirement savings is in a 401k and IRA. I max these out so I am assuming they are exempt. The Telemedicine company I work for has a 10 million per incident policy.
Any thoughts of how to mitigate further besides side gig or not practicing? I plan to spend some of those 10 years in New Zealand and Canada so my next questions will be about FBAR if you do a podcast on that one.
Thank you
1. All else being equal? Sure. Why not?
2. Usually not. Your big risk there isn’t losing money it’s being put in the database after the review is done. I don’t know how much an attorney is going to help with that. So I think any advantage to hiring a personal attorney (in addition to the one provided by the malpractice insurer) that exists with a non-government malpractice suit wouldn’t really be there in your case.
3. Only because your relationship with patients might be more short term so they might be more willing to sue you. Remember malpractice caps in almost all states are just pain and suffering caps. The actual damages are still unlimited in most states. So don’t count on that as your primary protection.
4. No. In the extreme scenario (which is very rare), there is an above policy limits judgment not reduced on appeal and the doc declares bankruptcy and is left only with what is protected in bankruptcy in their state. In most states that includes retirement accounts, some home equity, and a certain amount of stuff. In some states, you might get to keep life insurance cash value, annuities, HSAs, or 529s.
I think you should go buy The White Coat Investor’s Guide to Asset Protection. It’s written for people exactly like you.
https://amzn.to/3UTQ4t8
I’ll have to brush up on FBAR. Thanks for the warning.
Do you have a link to view states’ exemption laws? I’d like a resource to refer to when choosing what state to work in. I guess, which states are most asset protective. I’m a 1099 with solo and Roth 401ks and it’s my understanding that they’re not federally protected like other ERISA retirement funds.
Thank you!
Yes, I do. Here you go:
https://amzn.to/3EzWoCg
🙂 It’s half the book. And it was way too much work to make and keep it updated to just give it away for free. As far as your solo 401(k), it’s state dependent how much protection it gets.
Is there any insurance that covers against false claims like sexual harassment, defamation of character, or personal liability protection that one would recommend beyond what is covered by your employer?
Thank you
Not that I’ve ever seen.
I agree that it is exceedingly rare for a physician’s personal assets to be subject to loss secondary to a malpractice judgment.
However, I still believe that moderate asset protection is a wise strategy for physicians.
I was an expert in a malpractice action where the physician, in my opinion, followed the standard of care and was only peripherally related to the bad outcome. The physician had 1 million dollars of malpractice coverage. However, the outcome was catastrophic and a judgment against the physician could easily have exceeded 1 million dollars.
The plaintiff’s attorney wanted the physician to settle even though she had done nothing wrong. The physician had essentially few assets that were protected. The attorney threatened to seize the physician’s personal assets, children’s college fund, home, etc. if she did not settle for the limits of the policy. Fortunately, she held up and we prevailed in court. But, she took a risk.
The main value of asset protection in malpractice is that it gives you more confidence to refuse to settle a case in this type of situation where your personal assets are threatened and you did nothing wrong from a medical standpoint. It gives you more leverage when there is a negotiation with a plaintiff’s attorney. While it is probably not worthwhile to do exotic strategies for asset protection, moderate planning and preparation can be very valuable.
Yes, there are other benefits of asset protection besides actual asset protection. Lots of asset protection moves are cheap, easy, reliable, and have other benefits like maxing out retirement accounts and titling things properly.
Does an LLC that is used for investments (owner) of an after-tax investment account provides any protection in a malpractice lawsuit?
LLC law is state specific so can’t answer squat without knowing the state. I doubt judges are very impressed with a business that doesn’t do anything but buy mutual funds for its single owner. I’m guessing that does nothing most of the time. Maybe in some state if there are multiple owners it might not be accessible in bankruptcy. You know that’s how things provide protection in a malpractice lawsuit, right? You declare bankruptcy and get to keep certain assets.
I have the prejudice that doctors are at risk of lawsuit in other areas of life- injuries at their home/ property or office, sexual harassment or other allegations professional but nonmedical, etc. Since we are presumably deeper pockets.
When I was in an MVA the (at fault, 80+ yo ran the red light and got me) other driver’s family got my name and called my personal number and asked if I was Dr Jenn from Hospital X. I quickly and angrily said No! angry they had contacted me instead of working through their insurance company (and honestly since I didn’t work at Hosp X). Uncertain what their goal had been.
Still wish I’d further pursued the injury claim for my sore neck- or at least let a friend who does injury lawsuits decide if I should bother or not. Really hadn’t wanted to submit all my medical history to the other insurance company.
Great post.
Interesting point made by anonymous regarding how doctors are most vulnerable for suit compared to the system in which the are hired/work.
As for support, highly recommend Doctors and Litigation: The L word
This was a great article, I must say, having gone through my first malpractice case after 11 years in practice, although the suit was presented two years ago. Luckily, I was dismissed from the case after doing a single deposition with the plaintiff attorney.
Luckily, I had a senior partner who recommended an excellent malpractice lawyer to me, and although I worked with his junior associate, he was very well trained, and I felt completely prepared for the deposition
I would echo a lot of what Jim says: as a radiologist with minimal patient contact, staying up-to-date with your education so that you can reassure patients with data at the time of procedures, and of course documenting everything in your pre-procedure notes is crucial.
Extra visits to see the patient after a procedure, and the days after a procedure, even when not ostensibly necessary, and not relying on nurses and hospitalists, goes a long way towards building a positive relationship with every patient you see
There’s an excellent podcast on this called “the L word,” by an emergency medicine physician, Dr Geeta Pensa, who successfully defended herself in court twice for the same malpractice case over a 12 year span!
It’s unconscionable that we usually have to have claims made not occurence. I have no way to guess what the cost of my tail coverage will be the year I hope to quit medicine even one year out and got caught with double the expected cost in one of the stock market contractions- ie agent changed quote 1 day to double the next day and I truly had no option to paying double other than go naked. Please figure this risk into any decision on your rates going into a position! (IE employer to cover tail cost or you negotiate higher salary JIC.)
Does any malpractice carrier even offer occurrence policies anymore? I did some research prior to exiting clinical medicine in 2016; that year, only one carrier in the entire USA offered those policies, and only wrote them in the state of Wisconsin.
That’s weird because I have one in Utah and I had it in 2016 too.
#2- this seems to suffer the normal flaws and biases of surveys and polling. People won’t admit that what they really want is money they don’t deserve.
#9- our premiums have been increasing. According to our insurer this is due to a concerning rise in jackpot verdicts in our state and overall. Not just med mal cases.
As an Oral and Maxilliofacial Surgeon I have elected to purchase malpractice insurance from OMSNIC. Basiscally OMFS’ self insure. Premiums reasonable. The defense of claims is incredible with extremely high win rate. We purchase stock as part of our agreement (performed better than the Dow over last 20+ years). Our defense teams are the best in our profession. I am curious if other specialties offer a similar approach. I have been most pleased with OMSNIC. BTW LOVE WCI Thanks
Not sure I’ve seen specialty specific approaches before. Sounds pretty cool though. Hopefully it spreads.
Thanks for re-posting this article. Good timing for me as I have been sued for the first time in my 20 year career. Although the standard of care was met by any reasonable physicians view, the patient had a very bad outcome.
A few things I would add that I am/have learned through this process:
1. There is a legal difference between “Gross negligence” and “negligence” as to how much money someone can sue you for and how much the insurance companies will pay out. If you are found guilty of “gross negligence” then your malpractice insurance does not have to pay anything and it can be all personal expense and there are typically no limits on the amount. It is exceedingly rare for this to happen.
2. Often times the lawyers will actually wait until the last weeks of the statute of limitations to file the suit in order to accumulate as many damages as possible (both future and current).
3. The nightmares that can occur when you are sued are real. I am not a high anxiety person and never have been. But the anxiety and stress that a lawsuit causes are very real. Even when you feel like you are in the right, it is still concerning and can affect the way one practices medicine in the future.
My wife and I are FIRE physicians. We enjoy our busy and deep retirement life. But from time to time, I miss my physician role and abundant people interactions. Desires surface occasionally to go back for part time work. Reading through blogs like this burns off the romantic veil.
Our pleasure I think. 🙂