Regularly Review Your Insurance Coverage

We all know the importance of having insurance but the logic sometimes escapes us when it comes time to pay that expensive premium each month. However, given the spate of cases that abound, especially in the substance abuse treatment community, it’s vital to stay on top of your coverage.
When your profession revolves around clients who suffer from anxiety, depression or mental illness, you must always carefully consider your potential for liability issues. These claims can arise from advice and/or assistance (or lack of advice or assistance) provided by everyone from a psychiatrist to a tech and can include any of the following:

  • Improper treatment
  • Sexual Impropriety
  • Negligence (real or perceived)
  • Breach of confidentiality
  • Patient suicide
  • Libel or slander
  • Incorrect diagnosis
  • Failure to diagnose
  • Breach of contract

The most challenging part is that a patient can sue merely because he or she may have had an unsatisfactory experience.
Without the proper insurance in place you could end up facing $10-20,000 or more in legal fees.

That claim may fail, but without the proper insurance in place you could end up facing $10-20,000, or more, in legal fees. One such instance I’ve recently come across involved a counselor who by all appearances did everything by the book.

The counselor was experienced and state certified, working as a contract employee for a six-bed addiction treatment facility. She assessed the patient after admission and felt the patient did not meet the clinical standard for drug and alcohol addiction but rather struggled with mental illness. The facility owner rejected that assessment noting that such a determination was better made by his in-house clinical staff. The patient later attempted suicide and, while unsuccessful, ended up with permanent brain damage. A jury found the counselor partially liable because it believed the counselor should have taken measures to contact the family or lodged a complaint with a state agency. Never mind the fact that either of those could have resulted in a violation of HIPAA. Decisions like this put every employee and every treatment center between a rock and a hard place. When presented with a sympathetic patient with grievous injuries, the jury demanded standards beyond the counselor’s responsibilities, ethical requirements and scope of practice. Another point of concern is that even partial liability can lead to exposure to the full amount of damages in the US legal system. There a number of cases in which treatment centers find themselves liable for the full amount of a claim arising from the actions of an employee because employees are typically of limited means, so lawyers will go after the deep pockets of the treatment centers and their insurance companies.

Cases like this are not uncommon. There have even been instances when a patient stubbornly leaves treatment over the objection of the facility and the patient’s family turns around and sues the treatment professionals. In other cases, treatment centers have been held liable for inappropriate relationships between patients and employees. Anything and everything that happens under your roof can lead to a claim against you. That’s why it’s vital to know your coverage.

The two types you must definitely have are General Liability and Professional Liability. In addition to that you should consider coverage for Property and Crime. As an individual professional, you must also contemplate having your own personal policy for various reasons discussed further below.

General Liability Insurance – This protects from claims for accidental bodily injury such as a patient, employee or visitor slipping and falling at your facility.

Professional Liability Insurance – This protects from claims for errors and omissions. It’s designed to cover injuries from emotional and physical injuries arising from advice or the lack thereof (sometimes referred to as malpractice).

Property Insurance – This can protect against damages to your facility which may arise as a result of fire, water damage, or any other kind of physical destruction.

Theft Insurance – This can cover you for employee theft both from you and your patients, forgery, theft by third parties and even cybercrime.
All of which highlights the importance of reviewing your policy to know exactly what it contains. It’s vital to ensure you have the coverage you believe you do and in sufficient amounts so you don’t find yourself in the unfortunate circumstance of having to come out of pocket in the event your insurance limits are exhausted. It’s also critical to shop around. Prices and types of coverage vary from insurance company-to-company and state-to-state. Don’t be fooled into thinking you don’t have options. Lastly, individual doctors and counselors must consider having their own personal insurance even when they work at a facility with comprehensive coverage, for any number of the following reasons:

  1. A situation may arise creating conflict between the professional and the facility (as what occurred in the above example regarding the counselor).
  2.  An employer’s policy might not cover an employee’s legal fees.
  3. An employer’s coverage may not include past incidents once the employee has left the facility.
  4. An employer’s coverage will typically not include actions brought by any licensing board.
  5. A large claim against an employer may exhaust its coverage, leaving an employee exposed.

Liability and litigation are unfortunate but inherent parts of addiction treatment. We can be second guessed at any time for the treatment we provide. Since we’re already paying for insurance, it’s certainly worthwhile to review our policies to better understand why we have the coverage we do and contemplate what additional coverage we may need. We work very hard at what we do, providing high quality treatment to people in desperate need of recovery. With the proper insurance in place, we can keep everything running smoothly, without a hitch, even when faced with the unwelcome surprise of the unexpected.