Healthcare organisations will increase use of captives, predicts The Doctors Company
Large healthcare systems and practices are set to take on more of their own liability risk in coming years and will buy less commercial medical malpractice insurance than they have in the past.
That’s the view of Bill Fleming, chief operating officer of The Doctors Company, the US-based physician-owned medical malpractice insurer.
Fleming said: “Due to the historically low costs of medical malpractice insurance in recent years, there has been less of an incentive for healthcare organizations to self-insure. However, we see that era coming to an end.”
That insight is what prompted The Doctors Company to acquire Hospitals Insurance Company (HIC), a New York State admitted and licensed insurance company, and FOJP Service Corporation, a New York service organization that provided third-party insurance and risk management advisory services to HIC-insured hospitals.
At the close of the transaction in July, The Doctors Company formed Healthcare Risk Advisors (HRA), which succeeded FOJP, to focus on alternative risk solutions, including claims handling and patient safety risk management. Establishing HRA as a strategic business unit of The Doctors Company Group creates a platform to serve the self-insured healthcare market and support healthcare professionals and organisations across the healthcare spectrum.
“Our services focus exclusively on the needs of healthcare providers, highlighting our 40-year history of providing these services to The Mount Sinai Health System, Montefiore Health System, and Maimonides Medical Center,” said Robert Kauffman, president of HRA.
Fleming agreed, adding: “We were attracted to FOJP’s platform because of its success in providing alternative risk solutions, including handling the most sophisticated hospital and physician claims, coupled with outstanding patient safety risk management. HRA will leverage and grow on that success, continuing to serve existing clients, while adding additional hospital systems, large physician practices, and other healthcare organisations.”
HRA is led by Kauffman and Noeleen Doelger, who serves as chief operating and financial officer. David Feldman MD continues in the role of senior vice president and chief medical officer (CMO) for HRA, and has also been appointed CMO for The Doctors Company Group.
Richard Anderson MD, chairman and CEO of The Doctors Company, said its mission to advance, protect, and reward the practice of good medicine is “beautifully aligned with the great work of HRA.”
Kauffman said the transaction allows HRA to expand by providing various components for self-insured programs to additional physician groups, hospitals and healthcare systems nationwide, while continuing its successful platform of services to its New York clients.
“We remain steadfast in our commitment to provide our founding hospitals with the excellent service that supports what they do best—providing quality healthcare to their communities,” he added.
The Doctors Company’s medical professional liability book has 82,000 members and over $4.5 billion in assets. With the acquisition of HRA, those numbers climb to 90,000 insureds and over $6 billion in assets at the group level.
More information on HRA can be found at https://healthcareriskadvisors.com/.