by Anna Tauzin
With medical liability reforms in place, the number of lawsuits filed against physicians has fallen dramatically. In exchange for this reduction in non-meritorious litigation, Texas physicians have been tasked to do a better job of policing themselves. This task falls squarely on the shoulders of the Texas Medical Board (TMB).
According to the TMB web site, between 2000 and 2005 there was a 169% increase in disciplinary decisions and a 53% increase in the number of investigations opened. According to a press release dated August 31, 2006, the Board disciplined a record 99 physicians for violations ranging from failure to meet the standard of care to maintaining inadequate medical records.
Patients have the ability to air grievances against physicians by taking their cases to the TMB. In addition, the TMB will initiate its own investigation of the “medical competency” of a physician if three or more separate lawsuits and/or settlements were reported to them within a five-year period. This general statutory violation is known as the “Recurring Healthcare Liability Claims” violation and the Board will approach their review in the same manner as it evaluates a third-party complaint against the physician.
TMLT policies covering individual physicians include a Medefense Endorsement that provides legal and audit expense reimbursement for disciplinary proceedings, including actions by the TMB, and tax audits.
Introduced in 1998, the endorsement covers insured events such as proceedings instituted by the TMB, peer review proceedings by hospitals and other specified credentialing bodies, proceedings alleging fraud or non compliance with Medicare or Medicaid regulations, and measures taken by the state department of health or federal department of health and human services.
Once a TMLT policyholder is notified of a disciplinary action, he or she should follow the following steps to take advantage of Medefense coverage:
Step One: Notify TMLT as soon as you receive the initial letter from the TMB or other disciplinary authority. The policy states that a policyholder has 60 days in which to report an event or letter in order to receive reimbursement for covered expenses.
Step Two: Consider retaining an attorney to help draft a narrative and to respond to the TMB. John Southrey, a senior claims representative who handles many Medefense claims for TMLT policyholders advises that “retaining an experienced attorney as early as possible in this process can help to shape the case. It provides the attorney with the opportunity for an early interface with the Board’s investigator, hopefully before the investigator has formed their impressions, and it can facilitate a clear, concise, and objective response to the Board’s complaint without subjective or emotional overtones.” Working with an attorney who is knowledgeable of TMB proceedings can be advantageous because sometimes this can result in an early dismissal of the complaint. Upon request, TMLT can provide policyholders with a list of attorneys who have experience with the TMB and in handling disciplinary proceedings.
“I do not think that you can over emphasize the need to timely and thoroughly respond to the initial investigation letter from the Board. I have seen too many examples of cases where the physician responds on his own, or forwards a copy of the medical records without a response. Often the physician’s response does not contain what it should and can actually make matters worse. I have also seen responses, prepared by counsel with no prior Board experience, that do not adequately address the allegations at issue, and bring other issues to light which are then made part of the investigation,” said Gregory Myers, an attorney with Kroger, Myers, Frisby & Hirsch in Houston.
If the written response does not result in dismissal of the complaint, the Board will initiate an investigation and assign the case to an investigator. After the investigator obtains all the pertinent information, the file will be referred to the Board for its decision. If the results of the investigation show there was a possible violation(s), the file will be transferred to the Board’s Litigation Section for further action. When a case is referred to the Litigation Section, the first proceeding, held at the Board’s office in Austin, is an Informal Settlement Conference (ISC). It is strongly recommended that the physician retain legal representation well before the ISC, to give the attorney ample time to be fully prepared for that very important event.
The physician should keep track of all itemized attorney invoices and payment records. Southrey advises sending those invoices and payment records to TMLT periodically during the process. For reasonable legal expenses resulting from disciplinary proceedings, TMLT will reimburse policyholders up to $25,000 per policy period. The deductible for all policyholders is $1,000, with a 10% coinsurance for each insured event.
To receive timely reimbursement for Medefense coverage, policyholders should follow the guidelines outlined in the policy. According to the policy endorsement, “As a condition precedent to payment of any benefit hereunder, the Named Insured shall notify the Trust within sixty (60) days from the date of a disciplinary proceeding or tax audit being instituted.”
According to Southrey, “In order to preserve coverage it’s very important that policyholders pay attention to that 60-day window in which to report knowledge of a proceeding.”
Southrey also advises that any appeals stemming from the original disciplinary proceedings will be covered as a part of the same incident, and are reimbursable up to the maximum aggregate limit of $25,000. For example, if the physician chooses to contest a Board’s decision and the investigation is prolonged or additional attorney hours are billed, TMLT will continue to reimburse the physician up to the $25,000 annual aggregate limit, for all covered matters arising during the policy year. Physicians can use their Medefense coverage as many times as needed during the policy period, but the benefits paid for all actions combined cannot exceed the aggregate limit. Up to $5,000 of the annual aggregate may be used for covered audit expenses.
To speed the reimbursement process under Medefense, promptly send the following information to TMLT:
• A copy of the initial notification letter informing the recipient that a disciplinary proceeding has begun.
• Copies of legal expense invoices pertaining to the defense of the claim. The legal or audit expenses should be documented thoroughly, itemized on an hourly basis showing the service provided, the time incurred, and the hourly rate.
• Copies of all payments made to the attorney or law firm representing the policyholder in the claim.
• A copy of a final letter describing the outcome so the claim can be closed.
Facing a disciplinary proceeding can be a stressful and humbling experience. Not only is the physician’s license at risk, but TMB disciplinary actions are public information. Physicians are advised to work with an attorney who has experience with the TMB, and to report their Medefense claims within 60 days of notification. The Medefense endorsement assists our insured physicians by enabling them to get needed legal advice early in the process without having to bear the expense burden themselves. According to Bob Fields, Acting President and CEO of TMLT, “Our experience is that legal expenses required during TMB disciplinary proceedings rarely exceed $25,000”. This coverage affords the doctor some peace of mind during a distressing process.
To learn more about Medefense, please contact John Southrey or Aaron Trejo at 800-580-8658 or (512) 425-5800.
Anna Tauzin can be reached at anna-tauzin@tmlt.org.
