Members ask about practicing across state lines, tail insurance
Jonathan M.Fanaroff, M.D., J.D., FAAP
Pediatricians and the Law
AAP Fellows often send questions to the Committee on Medical Liability and Risk Management.
While the committee is unable to give specific legal advice, following is general
information in response to some of those questions that may be helpful.
It is important to recognize that laws vary state-to-state, and legal decisions depend
on the facts at hand. It also is important to consult a qualified attorney for legal
issues affecting your practice.
Q: If an established patient is located in another state (e.g., while on vacation
or at college) in which the pediatrician is not licensed, can the pediatrician treat
the patient (e.g., write prescriptions, treat via telephone or email, look at smartphone
photos of rashes/dog bites)?
A: The practice of medicine is regulated primarily by the state. Thus, the answer
depends on the laws of the states in which the pediatrician and the patient are located.
The Louisiana State Board of Medical Examiners, for example, would not allow treatment
from an out-of-state pediatrician, stating: “An individual who issues a prescription or orders medication for an individual who
is … located in Louisiana, who does not possess a Louisiana medical license or other
authorization to practice medicine in this state, is necessarily engaged in the unauthorized
practice of medicine in contravention of the Medical Practice Act. Participants and
entities engaged in such misconduct are subject to investigation, civil injunction,
monetary fines and penalties. Such individuals may also be referred by the Board to
the Louisiana Attorney General or an appropriate district attorney for criminal prosecution
and incarceration for up to five (5) months for each such offense” (http://bit.ly/2iN7V5L).
Other states such as Alabama would allow practice across state lines as long as they
occur less than 10 times per calendar year [Ala. Code §34-24-505(b)].
Some states have enacted the Interstate Medical Licensure Compact (www.licenseportability.org/) to simplify the process of obtaining licenses to practice in multiple states.
Due to the potential for civil, criminal or licensure penalties, it is critical to
understand the relevant state laws where you and the patient are located prior to
providing treatment. Additionally, electronic communications with patients should
be technically secure (e.g., encrypted) to comply with the Health Insurance Portability
and Accountability Act of 1996.
Q: I am an employed pediatrician and recently accepted a position with a new practice.
Who is responsible for paying my tail insurance — my former employer, my new employer
A: The most common type of malpractice insurance policy, known as claims-made, covers
claims that occur and are reported while the policy is active. Once the policy has
terminated, claims for care that occurred while the policy was active are no longer
covered unless additional coverage is purchased to extend the length of time a claim
may be filed. This is known as tail coverage. It is important for pediatricians to
obtain tail coverage when terminating a policy, given that many pediatric malpractice
cases are filed years (sometimes more than a decade) after care was provided.
Whether you or your former employer are responsible for paying for tail coverage is
going to depend on the terms of your employment agreement. Some arrangements specify
that the employer will pay unless the pediatrician is terminated with cause. Others
split the cost, and some place the burden on the pediatrician regardless of the reason
for separation. In some cases, a new employer will agree to pay the cost of tail (or
backwards looking “nose”) coverage.
Tail coverage can be expensive, so it is advisable for the pediatrician to negotiate
tail coverage as part of the employment agreement
Q: That brings up a second question. As I negotiate malpractice insurance for my new
position, is an occurrence or claims-made medical liability insurance policy better?
A: Unlike claims-made policies described in the first question, occurrence policies
cover any acts that occurred during the term of the policy, regardless of when the
claim is filed. Which policy is better often depends on individual circumstances.
Additionally, it may be helpful for pediatricians to ask their liability insurance
carrier whether claims-made or occurrence policies are purchased most often by a similar
practicing provider in that community. Occurrence policies are “permanent,” while
claims-made policies are more flexible (e.g., allowing increased limits).
While the rate and type of insurance are important, there are other considerations
when obtaining professional liability insurance. These include, but are not limited
to, the carrier’s financial stability, how it handles claims, physician involvement
in resolving claims and who makes the decision to settle a claim.
Email your questions for future columns in AAP News to firstname.lastname@example.org.
Dr. Fanaroff is chair of the AAP Committee on Medical Liability and Risk Management.