Health Plan Purchaser Liability Insurance

More and more, employers (your clients) are being drawn into Managed Care Liability Lawsuits brought against them by their employees. Most medium to large sized employers today have health insurance benefits (either fully or partially self-insured or purchase coverage from a Managed Care Health Plan) that use managed care techniques and processes in an effort to hold down/control costs.

The effort to hold down or control costs places the employer right in the targeted sites of the plaintiffs attorneys and the employees they represent when something goes wrong with the delivery of the health benefits.

There used to be the belief that the employer was protected under ERISA when self-insured or the health insurer was responsible under fully insured purchases since they deliver the benefits. Unfortunately, employers are drawn into the claim as well. Both quantity and quality liability exposures exist for the employer.

Some employers believe their General Liability, Employee Benefit Liability, Workers Compensation or Professional Liability Policies will cover these types of claims. Typically these types of policies exclude bodily injury to employees, bodily injury to employees for non-work related accidents/illnesses or bodily injury all together. Most certainly the coverage's listed above typically do not address the specific direct and vicarious Managed Care claims exposures listed below.

• Benefit Denial or Delay
• Managed Care Provider Selection
• Breach of Confidentiality
• Claims Services
• Utilization Review
• Case Management
• Medical Malpractice

Remember, your client does not have to deliver the service to be held liable. Delegated and contracted services still expose the employer to serious and expensive vicarious liability claims. Even the act of purchasing a fully insured plan can lead the employer into a lawsuit if the Managed Care Health Plan acts negligently.

Managed Care Health Plans are coming under more and more negative legal scrutiny. As your clients health plan benefit design looks and functions more like a Managed Care Health Plan, they will also come under the same aggressive and militant legal attacks as the Managed Care Health Plans are experiencing today.

Your clients will always be exposed to lawsuits from their employees as they seek a balance between quality of care and the cost of services.

For more informaion, please contact David Wood, President, Robert Gano, Executive Vice President, President, or Jodie Cole, Senior Vice President

Download an application here