AE March/April 2018 Vol 27 No 2 - 11

There are two types of malpractice
insurance policies available from most
carriers: Occurrence and Claims-Made.
You need to understand the difference
between these two types of malpractice
policies to ensure you are properly
covered at a reasonable cost.
paid for along the way. As a result,
there is no need to buy separate tail
coverage for an occurrence policy.
As expected, that tail coverage is
not really free for an occurrence
policy. The tail cost is merely
figured into the annual premium.
That is why an occurrence policy
is more expensive initially than a
claims made policy. An occurrence
policy can therefore be terminated
without ever having to buy or pay
for tail coverage.
Typically, a tail becomes necessary, and a tail premium becomes
due, when the claims-made policy
terminates. The policy may terminate if the insured doctor leaves the
state (or perhaps even the practice's
locale), changes malpractice insurance carriers, or, as often provided in a new ophthalmologist's
employment agreement, if the new
ophthalmologist's employment with
the practice ends.
WHO PURCHASES AND WHO
PAYS FOR TAIL COVERAGE
The prevalence today of claims-made
insurance makes the payment of the
tail premium a major concern for
numerous practice associates, practice
owners, and practices. The employment agreement for a non-owner
employed practice ophthalmologist
and the relevant employment/

partnership/operating/shareholders
agreement of a practice owner should
clearly address the handling of tail
coverage, particularly who purchases it, who pays for it, when it is to
be purchased, and when it is to be
paid for.
The question of who pays the tail
is important, since the premium
cost for claims-made malpractice
coverage policies for ophthalmologists is moderate (as compared to
other surgical specialties) in most
states and the tail cost, although
moderate, is not insignificant. The
tail cost is usually between 100%
and 200+% of the annual mature
premium. The best and only way to
determine how much the tail will
cost is ask the insurance carrier.
Malpractice insurance is usually
personal to the ophthalmologist
regardless of who actually pays the
premium. Also, in some states,
having malpractice insurance (including tail coverage) is a licensure
requirement, meaning that failure
to purchase and pay for the tail
may result not only in having no
insurance coverage in the event of a
malpractice claim, but also in losing
your medical license.
SOME TAIL COVERAGE ISSUES
Practice agreements often do not
specifically or adequately address

the purchase of the tail for employed ophthalmologists and practice owners. In actuality, there are
really two issues: (1) who actually
makes the purchase and (2) who
(the employed ophthalmologist/
practice owner or the practice)
actually absorbs the cost of the tail
and in what proportions.
At one time it was normal
for practices to pay the entire
annual malpractice premium
since malpractice insurance was
simply considered a cost of doing
business. Likewise, even if a
practice elected to buy a claimsmade policy, the practice would
nevertheless pay the entire tail
premium since it benefited from
the cost savings of the initially
lower premiums.
Despite that logic and history,
most ophthalmology practices
today seek to shift all or some of
the tail coverage cost to employed
ophthalmologists and even to practice owners.
Lastly, one benefit of getting
older is that many insurance carriers provide a free tail for ophthalmologists who are long-term
(usually at least 5 years) policy
holders and actually retire from
practice medicine. Check with the
insurance carrier for the precise
details and requirements to qualify for this free tail. AE
Mark E. Kropiewnicki,
JD, LL.M. (610-8283888; mkrop@
healthcaregroup.com), is
a principal attorney with
Health Care Law Associates, P.C.,
and a principal consultant with The
Health Care Group, Inc., both based
in Plymouth Meeting, Pa.

www.asoa.org // AE

11


http://www.asoa.org

Table of Contents for the Digital Edition of AE March/April 2018 Vol 27 No 2

How We Can Successfully Lead
Advanced Administration: Administrator Success Factors—Needing a Tune-Up Is Expected
Advice for New Administrators: Introducing the Administrator Beginners Circle—The Go-To Resource for New Administrators
Business Operations: Some Things to Know About Professional Liability Insurance
Customer Care: Making a Diffi cult Journey A Little Easier
Fast Practice: Breaking Down Practice Cliques
Human Resources: Recruiting Strategies for Ophthalmology—Where to Search for New Physicians
InfoTech: Cloud Computing— Storms or Blue Skies?
Reimbursement: Embracing Change to Thrive in an Evolving Reimbursement World
Technicians: Creating a “Feeder Program” to Staff Your Clinic
Washington Watch: MIPS in 2018—Key Changes for Ophthalmic Practices
Taking Your Practice to the Top
Use Podcasts to Increase Practice Visibility—and Thrive
Trailblazing— How to Implement Career Pathing in Your Practice
Ocular Surface Disease: Reimbursement Considerations for the Evaluation and Management of Dry Eye
Retina: Should Retinal Specialists Be Integrated Into a Multispecialty Practice?
Asked and Answered
ASOA News
Bookshelf: Off Balance On Purpose: Embrace Uncertainty and Create a Life You Love
COE Corner: Preparing for the COE Exam – Keep Your Eye on the Prize
Focus on a Practice: Ohio Valley Eye Physicians & Surgeons, PLLC, on Operating a Practice in Two States
Gamechanger: Karen Bachman, COE, COMT, OCS, ROUB
Advertisers’ Index
Peer to Peer: What’s Your Favorite Technique for Holding a Productive Staff Meeting?
AE March/April 2018 Vol 27 No 2 - Cover1
AE March/April 2018 Vol 27 No 2 - Cover2
AE March/April 2018 Vol 27 No 2 - 1
AE March/April 2018 Vol 27 No 2 - 2
AE March/April 2018 Vol 27 No 2 - 3
AE March/April 2018 Vol 27 No 2 - 4
AE March/April 2018 Vol 27 No 2 - How We Can Successfully Lead
AE March/April 2018 Vol 27 No 2 - Advanced Administration: Administrator Success Factors—Needing a Tune-Up Is Expected
AE March/April 2018 Vol 27 No 2 - 7
AE March/April 2018 Vol 27 No 2 - Advice for New Administrators: Introducing the Administrator Beginners Circle—The Go-To Resource for New Administrators
AE March/April 2018 Vol 27 No 2 - 9
AE March/April 2018 Vol 27 No 2 - Business Operations: Some Things to Know About Professional Liability Insurance
AE March/April 2018 Vol 27 No 2 - 11
AE March/April 2018 Vol 27 No 2 - Customer Care: Making a Diffi cult Journey A Little Easier
AE March/April 2018 Vol 27 No 2 - 13
AE March/April 2018 Vol 27 No 2 - Fast Practice: Breaking Down Practice Cliques
AE March/April 2018 Vol 27 No 2 - 15
AE March/April 2018 Vol 27 No 2 - Human Resources: Recruiting Strategies for Ophthalmology—Where to Search for New Physicians
AE March/April 2018 Vol 27 No 2 - 17
AE March/April 2018 Vol 27 No 2 - InfoTech: Cloud Computing— Storms or Blue Skies?
AE March/April 2018 Vol 27 No 2 - 19
AE March/April 2018 Vol 27 No 2 - Reimbursement: Embracing Change to Thrive in an Evolving Reimbursement World
AE March/April 2018 Vol 27 No 2 - 21
AE March/April 2018 Vol 27 No 2 - Technicians: Creating a “Feeder Program” to Staff Your Clinic
AE March/April 2018 Vol 27 No 2 - 23
AE March/April 2018 Vol 27 No 2 - Washington Watch: MIPS in 2018—Key Changes for Ophthalmic Practices
AE March/April 2018 Vol 27 No 2 - 25
AE March/April 2018 Vol 27 No 2 - Taking Your Practice to the Top
AE March/April 2018 Vol 27 No 2 - 27
AE March/April 2018 Vol 27 No 2 - 28
AE March/April 2018 Vol 27 No 2 - 29
AE March/April 2018 Vol 27 No 2 - 30
AE March/April 2018 Vol 27 No 2 - 31
AE March/April 2018 Vol 27 No 2 - 32
AE March/April 2018 Vol 27 No 2 - 33
AE March/April 2018 Vol 27 No 2 - Use Podcasts to Increase Practice Visibility—and Thrive
AE March/April 2018 Vol 27 No 2 - 35
AE March/April 2018 Vol 27 No 2 - 36
AE March/April 2018 Vol 27 No 2 - 37
AE March/April 2018 Vol 27 No 2 - Trailblazing— How to Implement Career Pathing in Your Practice
AE March/April 2018 Vol 27 No 2 - 39
AE March/April 2018 Vol 27 No 2 - 40
AE March/April 2018 Vol 27 No 2 - 41
AE March/April 2018 Vol 27 No 2 - Ocular Surface Disease: Reimbursement Considerations for the Evaluation and Management of Dry Eye
AE March/April 2018 Vol 27 No 2 - 43
AE March/April 2018 Vol 27 No 2 - Retina: Should Retinal Specialists Be Integrated Into a Multispecialty Practice?
AE March/April 2018 Vol 27 No 2 - 45
AE March/April 2018 Vol 27 No 2 - Asked and Answered
AE March/April 2018 Vol 27 No 2 - 47
AE March/April 2018 Vol 27 No 2 - ASOA News
AE March/April 2018 Vol 27 No 2 - 49
AE March/April 2018 Vol 27 No 2 - Bookshelf: Off Balance On Purpose: Embrace Uncertainty and Create a Life You Love
AE March/April 2018 Vol 27 No 2 - 51
AE March/April 2018 Vol 27 No 2 - COE Corner: Preparing for the COE Exam – Keep Your Eye on the Prize
AE March/April 2018 Vol 27 No 2 - 53
AE March/April 2018 Vol 27 No 2 - Focus on a Practice: Ohio Valley Eye Physicians & Surgeons, PLLC, on Operating a Practice in Two States
AE March/April 2018 Vol 27 No 2 - 55
AE March/April 2018 Vol 27 No 2 - Gamechanger: Karen Bachman, COE, COMT, OCS, ROUB
AE March/April 2018 Vol 27 No 2 - 57
AE March/April 2018 Vol 27 No 2 - Advertisers’ Index
AE March/April 2018 Vol 27 No 2 - 59
AE March/April 2018 Vol 27 No 2 - Peer to Peer: What’s Your Favorite Technique for Holding a Productive Staff Meeting?
AE March/April 2018 Vol 27 No 2 - Cover3
AE March/April 2018 Vol 27 No 2 - Cover4
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