If they're big enough to carry the costs, it's making increasing sense for physician groups to create their own captive medical malpractice insurer. A growing number are looking at pooling their malpractice premiums, creating a new med mal "risk retention" insurer which they can control. The groups, which rely on the Federal Liability Risk Retention Act, are fighting to control an aspect of their business which has been a tremendous source of pain the past.
One recent example comes from Fort Wayne, IN, where a group of 100-odd doctors cutting across nine practices have come together to create a risk retention group. To launch the new insurer, Fort Wayne Medical Assurance, the groups raised $1 million. Because there's no risk-retention law on the books in Indiana, the group is opening an office in Phoenix, but operates in its home state. To avoid slip-ups, the groups' insurance program is being managed by AON Risk Managers, an insurance services company. Once established, the group plans to offer insurance to other practices in northeast Indiana, but the founders' main goal is to control internal med mal costs.
To learn a bit more about this model:
- read this piece in The Journal Gazette