Regulatory and cyber (e-MD) liability resources
Coverage for the 14 different regulatory and cyber electronic media (e-MD) exposures is included in OMIC’s standard professional liability policy at no additional premium, subject to a per policy period sublimit of $100,000 per claim and in the aggregate. The sublimit for disciplinary proceedings related to direct patient treatment is $25,000. For a list and description of all 14 additional benefits included in your OMIC policy, visit www.omic.com/policyholder/benefits/.
On the policyholder benefits page you will find information under the following categories:
- Billing Errors (“Fraud and Abuse”) Allegations
- HIPAA/HITECH Privacy Violations
- Other Regulatory Exposures (DEA, Stark Act, EMTALA investigations)
- Licensure Actions
- Disciplinary Proceedings
- Cyber Liability and Network Vulnerabilities (e-MD)
With the move to electronic medical records, HIPAA and HITECH exposures related to cyber and electronic media breaches have increased for ophthalmic practices. Practices are also subject to a wide variety of potential losses as a result of network vulnerabilities, including damage to, or loss of, data. To assist policyholders, OMIC now has a dedicated web page devoted to cyber liability exposures. Visit the risk management section of OMIC’s website for articles, tools, links, and loss prevention resources.
Exclusively for policyholders
OMIC launched a Cyber Liability Risk Management Portal in 2014. Go to www.omic.com/risk-management/ for links to state-specific regulations, sample templates and protocols, employee notices and guidebooks, compliance plans, and coverage information. You must register or log in to MyOMIC services online to access the portal. The process is easy and takes just a few minutes. For live assistance, please contact the policyholder risk management hotline at 800.562.6642 (press 4) or email a risk manager at riskmanagement@omic.com.
What You Should Know about Rates and Dividends
The Board of Directors is pleased to announce a 25% dividend for all physician insureds in the form of a 2015 renewal premium credit and continuation of 2014 rates through your 2015 policy year. Issuance of the dividend requires that an active 2014 professional liability policy be renewed and maintained throughout the 2015 policy period. Mid-term cancellation would result in a pro-rata dividend.
Dividends appear on your policy invoice as a credit to either your annual or quarterly billing installment. OMIC issues dividends as a credit toward renewal premiums for two reasons. First, premium credits offer favorable tax implications for policyholders. Second, premium credits allow for easy and efficient distribution of dividends.
Each year OMIC’s Board receives a report from actuaries describing current claims trends and how they relate to rate levels for each state and territory. Using this information, we determine whether a rate increase or decrease for the current or upcoming year is warranted. Dividends, on the other hand, are generally determined on the basis of whether claims trends for past years are better (or worse) than expected. Because malpractice claims have a “long tail,” in which resolution often occurs several years after the incident is reported, trends are only evident after careful monitoring of claims over a significant period of time.
OMIC continues to reduce malpractice insurance costs through lower rates and paid dividends. In addition to average premium reductions of nearly 30% nationally since 2005, OMIC has announced dividend credits totaling more than $58 million since our company’s inception, outperforming our peer companies by a significant margin. Issuance of dividend credits is not guaranteed and is determined each year after careful analysis of our operating performance. OMIC’s philosophy is to return any premium above which is necessary to prudently operate the company and to do so at the earliest opportunity.
OMIC Increases Coverage Limit on Policy Benefits
We are pleased to announce that your standard policy benefit limits for regulatory and cyber exposures will be increased from $50,000 to $100,000 per policy year effective January 1, 2015. OMIC has monitored the exposures related to administrative practice activities, such as billing reimbursements for services and electronic storage and transmission of protected health information. In response to an expected rise in the number of Recovery Audit Contractor requests and an increase in the number of reported breaches, including lost and stolen laptops and devices, OMIC’s Board decided to increase your coverage benefit to help reimburse for unexpected costs associated with these and similar events.
OMIC was one of the first malpractice carriers to cover its policyholders for proceedings related to billing errors and other regulatory exposures. Over the years, the coverage has been continually expanded and enhanced to meet the changing exposures of our insureds’ medical practice, including the rapid move to electronic medical records. OMIC’s standard professional liability policy now provides protection for 14 related events and proceedings.
Broad Regulatory Protection (BRP) reimburses insureds for legal expenses relating to regulatory proceedings, including billing errors, DEA, EMTALA, HIPAA, covered licensing, and STARK proceedings, and peer review. BRP also covers audit expenses related to billing errors proceedings and fines or penalties (where allowed by state law) related to billing errors, EMTALA, HIPAA, and STARK proceedings.
Cyber (eMD®) protection covers insureds for electronic media exposures and breaches. These include multimedia, security and privacy liabilities, privacy regulatory defense and penalties, security and privacy breach response costs, notification expenses, and support and credit monitoring expenses. eMD® also covers network asset protection and cyber extortion and terrorism.
For more information on your coverage benefits included within OMIC’s standard professional liability policy, please visit www.omic.com/policyholder/benefits or call your underwriting representative.
Denise Chamblee is New Risk Management Chair
The OMIC Risk Management Department welcomed a new committee chair and risk management specialist earlier this year. Denise R. Chamblee, MD, a pediatric ophthalmologist in Newport News, VA, and an OMIC Board member, will chair OMIC’s Risk Management Committee. Since joining the Committee in 2008, Dr. Chamblee has been a major contributor to the development of OMIC’s retinopathy of prematurity hospital and office safety nets. She also works closely with the American Academy for Pediatric Ophthalmology and Strabismus on ROP-related patient safety/quality of care issues. Dr. Chamblee is a graduate of the American Academy of Ophthalmology’s 2013 Leadership Development Program.
Michelle Pineda joined the OMIC staff as a risk management specialist in February. Ms. Pineda has a Masters of Business Administration from St. Mary’s College in Moraga, CA, and brings years of work experience with a large medical professional liability carrier and Bay Area high tech companies. She will work with Anne Menke, RN, PhD, and Hans Bruhn, MHS, to handle confidential hotline calls and other risk management queries from insureds.
The Risk Management Department also has a new fax number, 415.771.1095, for all risk management-related business. The department’s phone number is still 800.562.6642, option 4. Risk management queries can also be emailed to riskmanagement@omic.com.
Surcharge Eliminated for Cosmetic Procedures
Digest, Spring 2013
At its May meeting, the OMIC Board of Directors voted to eliminate the premium surcharge for ophthalmologists who perform facelift, rhinoplasty, and full body liposuction for policies effective on or after May 1, 2013. The decision was based upon favorable underwriting and claims data tracked by OMIC since the company first approved coverage for these procedures over 15 years ago.
During a recent retrospective review of OMIC-specific and industry-wide claims data, it became evident that the risk exposure for these cosmetic procedures was lower than expected and that OMIC’s experience outperformed that of the industry. Only one claim and two incidents involving facelift procedures have been reported to OMIC since 1997. All three were resolved without indemnity and total expenses paid were $698. Two claims involving liposuction were reported against OMIC-insured physicians. One closed without indemnity and the other settled for $150,000. Expenses for the two claims totaled $24,715. A third claim involving liposuction was brought against an OMIC-insured surgery center for a procedure performed by an open-access member. No rhinoplasty claims have been reported to OMIC to date.
Cosmetic surgery has become safer in the past decade thanks to new “minimally-invasive,” “non-invasive,” or “non-surgical” techniques that carry significantly less risk than more traditional techniques. Continuing medical education courses have given ophthalmologists desiring to add these procedures to their practice the skills and training necessary to do so successfully.
Elimination of the surcharge means that ophthalmologists who perform facelift, rhinoplasty, and total body liposuction will now pay the same rate for professional liability coverage through OMIC as their colleagues who limit their surgery to traditional ophthalmic procedures. This rate is far below what a plastic surgeon, otolaryngologist, or other specialist must pay for similar coverage.
