Business Associate

OMIC has completed its revision of the HIPAA Business Associate (BA) Agreement it maintains between itself and each of its insureds. You can download a copy here:  Business Associate Agreement-OMIC-9.1.2013. A hard copy is also being sent to OMIC insureds by mail. Please understand that because OMIC has 4,500 physician insureds, it would be administratively burdensome for OMIC to review and sign individual BA Agreements provided by each of its insureds. OMIC’s BA Agreement meets the latest HIPAA and HITECH standards as promulgated in the Omnibus HIPAA/HITECH Final Rule and is the only BA Agreement that OMIC will maintain between itself and its insureds. Please retain your copy of the OMIC BA Agreement with your HIPAA compliance materials.

Changes to OMIC’s Professional and Limited Office Premises Liability Insurance Policy (effective 09/1/2013)

OMIC is pleased to announce that the Broad Regulatory Protection and e-MD Protection coverages provided in OMIC’s Professional and Limited Office Premises Liability Insurance policy have been enhanced for 2013 at no additional charge. This article is a summary; for a complete review of your coverage, please refer to the OMIC policy.

Highlights of Changes in 2013 Additional Benefits in the 2013 OMIC Professional and Limited Office Premises Liability Policy:

Peer review coverage

OMIC’s Broad Regulatory Protection (BRP) reimburses insureds for legal expenses relating to regulatory proceedings, which include billing errors, DEA, EMTALA, HIPAA, covered licensing, and STARK proceedings. BRP also covers fines or penalties related to billing errors, EMTALA, HIPAA, and STARK proceedings. While OMIC’s policy already covered actions by regulatory agencies and state licensing authorities under its Disciplinary Proceeding Protection and BRP, in 2013, it added peer review bodies to the list. Under BRP, OMIC now reimburses legal expenses for professional review actions by the review body of a hospital or other health care facility that could adversely affect the insured’s clinical privileges there.

e-MD additions

As insureds continue to move more of their records, communications, and marketing online, coverage for cyber liability risks becomes more crucial. OMIC’s e-MD Protection now provides seven different coverages. One of the 2013 additions is Multimedia Liability Coverage. It covers claims made against the insured for the display of any electronic or print media by the insured that directly results in defamation, invasion of privacy, plagiarism, or copyright infringement.

Another new coverage is Network Asset Protection. It covers digital assets loss, that is, the expenses necessary to restore or replace the insured’s damaged or stolen data and computer programs, because of accidental damage, operational mistakes, or a computer crime that an insured failed to prevent. It also covers the insured’s income loss and interruption expenses incurred during the time it takes to restore these digital assets.

e-MD Protection now also includes Cyber Extortion and Cyber Terrorism Coverages. Under Cyber Extortion Coverage, OMIC pays money to stop the person responsible from executing a credible threat to release confidential information or corrupt the insured’s computer system. Cyber Terrorism Coverage pays income loss and interruption expenses during a period of restoration of the insured’s computer system required because of an act of terrorism.

e-MD enhancements

While the following provisions are not new, they have been enhanced. The e-MD Security and Privacy Liability Coverage covers claims made against the insured for security and privacy wrongful acts. The Security and Privacy Regulatory Defense and Penalties Coverage covers legal expenses and regulatory fines, penalties, or compensatory awards the insured must pay because of such acts. Many acts fall within the definition of security and privacy wrongful acts. For example, a security and privacy wrongful act occurs if an insured fails to prevent unauthorized access to or infection of the insured’s computer system (a “security breach”) that results in destruction of electronic data stored on the insured’s computer system, unauthorized disclosure of confidential information that is in the insured’s care, or unauthorized access to a computer system other than the insured’s. The insured’s failure to prevent the transmission of computer viruses from the insured’s to a third party’s computer system is also a security and privacy wrongful act. A privacy breach, i.e., a breach of confidence, a violation of rights to privacy, or a violation of laws associated with the control of personally identifiable financial or medical information, also constitutes a security and privacy wrongful act.

The Security and Privacy Breach Response Costs, Notification Expense, and Support and Credit Monitoring Expense Coverage now covers the cost of employing a public relations consultant to mitigate damage to the insured’s reputation due to a publicized report of a privacy or security breach. It also covers the expenses of notifying affected individuals in the event of such a breach. Finally, it pays for the provision of customer support in the event of a privacy breach, including credit file monitoring and identity theft assistance.

The BRP and e-MD per proceeding/claim and aggregate (all claims in a policy period) limit is $50,000. The BRP and e-MD Protection coverages also include a two year extended reporting period if the insured acquires tail coverage for the policy.

If you have questions about these policy benefits, please call 800.562.6642, ext. 661.

If you need to report a proceeding or claim, contact OMIC’s Claims Department at 800.562.6642, ext. 672.

Changes to OMIC’s Professional and Limited Office Premises Liability Insurance Policy (effective 08/14/2012)

The following changes have been made to and replace Section VII. Additional Benefits in the January 1, 2012, OMIC Professional and Limited Office Premises Liability Insurance policy:

SECTION VII. ADDITIONAL BENEFITS
A. Disciplinary Proceeding Protection

OMIC shall defend and pay Claim expenses for any Insured ophthalmologist named in the Declarations whose class is identified as Ophthalmology against any investigation, disciplinary proceeding, or action for review (hereinafter “disciplinary proceeding”) of the Insured’s practice by any federal, state, or local regulatory agency arising from a complaint or report by a patient to such agency of an injury to that patient resulting from a professional services incident involving direct patient treatment provided by the Insured. However, OMIC will have no liability for fines, sanctions, penalties, or other financial awards resulting from the disciplinary proceeding.

This Benefit will only be provided if:

1. The professional services incident upon which the disciplinary proceeding is based occurred on or after the applicable retroactive date and prior to the end of the applicable policy period; and

2. The disciplinary proceeding is first made against the Insured and the Insured provides timely written notice of the disciplinary proceeding to OMIC during the applicable policy period or extended reporting period.

This coverage does not apply to any disciplinary proceeding that arises out of a professional services incident that is not covered under this policy, or would be specifically excluded if brought as a Claim under this policy.

The most OMIC will pay per Insured for Claim expenses for any one disciplinary proceeding is $25,000. The most OMIC will pay per Insured for Claim expenses for all such disciplinary proceedings during the policy period or the extended reporting period will be $75,000.

The Additional Benefit pertaining to any disciplinary proceedings or regulatory proceedings arising out of the same events is afforded either under Subsection A. or B., not both, and one limit applies.

B. Broad Regulatory Protection

OMIC shall reimburse any Insured ophthalmologist or professional entity named in the Declarations for (1) any legal expenses incurred as a result of a regulatory proceeding instituted against the Insured during the policy period or within the first two years of any extended reporting period added by endorsement to this policy; (2) any audit expenses incurred in the course of a shadow audit related to a billing errors proceeding instituted against the Insured during the policy period or within the first two years of any extended reporting period added by endorsement to this policy; and (3) fines or penalties imposed against the Insured as a result of a billing errors proceeding, EMTALA proceeding, HIPAA proceeding, or STARK proceeding instituted against the Insured during the policy period or within the first two years of any extended reporting period added by endorsement to this policy.

This Benefit will only be provided if:

1. The act, error, or omission upon which the regulatory proceeding is based actually or allegedly takes place prior to the end of the policy period; and

2. The Insured provides timely written notice of the regulatory proceeding to OMIC during the policy period or within sixty days after the expiration of the policy period or within the first two years of any extended reporting period added by endorsement to this policy.

Definitions. This Section defines various terms used in this Subsection VII.B. These terms are indicated throughout the Subsection in bold, italicized print. Refer to Section I. Definitions of the policy for terms that are shown in bold, but not defined below. If a term is defined below and in Section I. Definitions of the policy, the definition below applies to this Subsection VII.B.

1. Audit expenses means the fees for the services of a qualified audit professional and associated expenses incurred by the Insured in the course of a shadow audit.

2. Billing errors proceeding means (a) a civil investigation or proceeding instituted against the Insured by a qui tam plaintiff under the federal False Claims Act, by a government entity, or by a commercial payer alleging presentation of erroneous billings by the Insured to a government health benefit payer or commercial payer from which the Insured seeks or has received payment or reimbursement for medical service or items or (b) an investigation or proceeding instituted against the Insured because of the Insured’s voluntary self disclosure to any government entity.

3. Covered licensing proceeding means a proceeding instituted against the Insured by a state licensing authority that arises out of the practice of ophthalmology but that does not include a professional services incident involving direct patient treatment.

4. DEA proceeding means a proceeding instituted against the Insured by the Drug Enforcement Agency (“DEA”), for the purpose of adversely affecting the Insured’s ability to prescribe drugs pursuant to a license issued by the DEA.

5. EMTALA proceeding means a proceeding instituted against the Insured by a government entity alleging one or more violations of the Emergency Medical Treatment and Active Labor Act (“EMTALA”).

6. Fines or penalties means administrative fines or penalties the Insured is required to pay as a result of a covered billing errors proceeding, EMTALA proceeding, HIPAA proceeding, or STARK proceeding (but not a DEA proceeding or covered licensing proceeding).

7. HIPAA proceeding means a proceeding instituted against the Insured by a government entity alleging violation of the Health Insurance Portability and Accountability Act (“HIPAA”) privacy and security regulations.

8. Instituted means the time formal written notice of a regulatory proceeding is received by the Insured. All related proceedings comprising a regulatory proceeding shall be deemed to have been instituted at the time the earliest of such proceedings was instituted.

9. Legal expenses means an attorney’s fees for legal services rendered in defense of a regulatory proceeding, associated expenses, and related, OMIC pre-approved consultant fees other than audit expenses. Legal expenses do not include costs associated with the adoption and implementation of any corporate integrity agreement or compliance or similar program negotiated as part of a settlement with or by order of a government entity.

10. Regulatory proceeding means a billing errors proceeding, DEA proceeding, EMTALA proceeding, HIPAA proceeding, covered licensing proceeding, or STARK proceeding instituted against the Insured during the policy period that results in legal expenses, audit expenses, or fines or penalties (where applicable). All related and consolidated proceedings, and proceedings arising out of the same facts, events, or circumstances, including appeals and post-trial proceedings, shall be considered one regulatory proceeding.

11. Shadow audit means an audit performed by a qualified professional, which examines the same billing records and related documents as those subject to an ongoing billing errors proceeding, with the intent of providing the Insured with a private expert opinion.

12. STARK proceeding means a proceeding instituted against the Insured by a government entity alleging violation of any federal, state, or local anti-kickback or self-referral laws.

13. Voluntary self disclosure means the Insured discloses information to a government entity, without prior solicitation by the entity of such information, which information may serve as grounds for a billing errors proceeding against the Insured. Such information must have become known to the Insured fortuitously and subsequent to the initial effective date of the policy.

Exclusions. These exclusions are applicable to this Subsection VII.B.:

1. This Benefit does not apply to regulatory proceedings that arise from any circumstances, events, or causes that (1) are underlying in any litigation, government investigation or proceeding, other notice pending, or any judicial decree or judgment entered; (2) are the subject of notice to an insurer under any other insurance policy; or (3) any Insured or any of his/her/its supervisory level employees knew or had a reasonable basis to know might result in a regulatory proceeding, prior to the Insured’s original effective date.

2. No benefits shall be reimbursable for legal expenses, audit expenses, or fines or penalties:

a. arising out of any matter that any Insured has acted with another to institute, except for voluntary self disclosure;

b. arising out of any matter brought against an Insured by any other Insured, except if brought by a qui tam plaintiff or under the federal False Claims Act;

c. incurred in defense of a criminal proceeding. Criminal proceeding shall mean a governmental action for the enforcement of criminal laws, including those offenses for which conviction could result in criminal fines and/or incarceration;

d. arising out of any liability of any Insured assumed under any contract or agreement, except if the Insured would have been liable in the absence of such contract or agreement and the legal expenses, audit expenses, or fines or penalties would have otherwise been covered by this benefit;

e. arising out of a billing errors proceeding involving billing errors for medical services or items provided or prescribed by someone other than an Insured; and

f. incurred in the course of a shadow audit not previously approved by OMIC, which approval will not be unreasonably withheld.

3. This Benefit does not apply to:

a. restitution of fees, reimbursements, profits, charges, or benefit payments received by the Insured from a government health benefit payer, commercial payer, or patient that the Insured was not legally entitled to by reason of billing error;

b. damages, including compensatory damages, punitive damages, exemplary damages, or additional damages resulting from the multiplication of compensatory damages, or any amounts which are deemed uninsurable by law;

c. remuneration, salaries, fees, or overhead of any Insured; and

d. the costs associated with the adoption and implementation of any corporate integrity agreement, compliance program, or similar provision regarding the operations of the Insured’s business negotiated as part of a settlement with or by order of a government entity.

Choice of Counsel and Co-Payment. OMIC does not assume any duty to defend under this Additional Benefit. The Insured shall have complete freedom of choice of counsel. Upon receiving notice from an Insured of a regulatory proceeding, OMIC will provide the Insured with the name(s) of panel counsel. If the Insured retains panel counsel for the regulatory proceeding, OMIC will, subject to the other provisions of this policy, reimburse 100% of covered legal expenses, audit expenses, and fines and penalties (where applicable). If the Insured retains non-panel counsel for the regulatory proceeding, OMIC will reimburse 75% of covered legal expenses, audit expenses and fines or penalties (where applicable), and the Insured must make a copayment of 25%. Rates for non-panel counsel will be limited to a maximum of $300 per hour. All counsel, panel or non-panel, must comply with OMIC’s reasonable parameters.

Coverage Limit. The most OMIC will reimburse per Insured for legal expenses, audit expenses, and fines or penalties for any one regulatory proceeding and in the aggregate for all regulatory proceedings instituted during a policy period is $50,000. Any extended reporting period does not increase the limit; it is shared with the prior policy period.

The Additional Benefit pertaining to any disciplinary proceedings or regulatory proceedings arising out of the same event(s) is afforded either under Subsection A. or B., not both, and only one limit applies. The Additional Benefit pertaining to any HIPAA proceedings or privacy wrongful acts arising out of the same event(s) is afforded either under Subsection B. or C., not both, and only one limit applies (Subsection C. limits are a sub-limit of Subsection B. limits, regardless). OMIC has the sole discretion to determine which coverage provision applies in any event.

C. e-MD™ Network Security & Privacy Coverage, Notification and Credit Monitoring Costs Coverage, and Data Recovery Costs Coverage

This Section VII.C. provides three different coverages. Section VII.C.1. covers network security wrongful acts and privacy wrongful acts committed or alleged to be committed by an Insured. Section VII.C.2. covers notification and credit monitoring costs resulting from privacy wrongful acts committed or alleged to be committed by an Insured. Section VII.C.3. covers data recovery costs resulting from a data interference act committed by someone other than an Insured.

1. Network Security & Privacy Coverage

OMIC shall pay on behalf of any Insured ophthalmologist or professional entity named in the Declarations the loss and legal expenses such Insured becomes legally obligated to pay as a result of a claim for a network security wrongful act or privacy wrongful act first made against such Insured during the policy period or within the first two years of any extended reporting period added by endorsement to this policy. OMIC shall have the right and duty to defend any claim even if the allegations of the claim are groundless, false, or fraudulent. OMIC shall have the right to appoint defense counsel and to investigate any claim as OMIC deems necessary.

This Benefit will only be provided if:

1. The network security wrongful act or privacy wrongful act actually or allegedly takes place on or after the retroactive date and prior to the end of the policy period; and

2. The Insured provides timely written notice of the claim to OMIC during the policy period or within sixty days after the expiration of the policy period or within the first two years of any extended reporting period added by endorsement to this policy.

2. Notification and Credit Monitoring Costs Coverage

OMIC shall pay on behalf of any Insured ophthalmologist or professional entity named in the Declarations the notification and credit monitoring costs incurred during the policy period or within the first two years of any extended reporting period added by endorsement to this policy as a result of a privacy wrongful act, but only if such notification and credit monitoring costs are incurred with OMIC’s prior written consent. OMIC will not unreasonably withhold consent.

This Benefit will only be provided if:

The privacy wrongful act actually or allegedly takes place on or after the retroactive date and prior to the end of the policy period; and
The Insured provides timely written notice of the privacy wrongful act to OMIC during the policy period or within sixty days after the expiration of the policy period or within the first two years of any extended reporting period added by endorsement to this policy.
3. Data Recovery Costs Coverage

OMIC shall pay on behalf of any Insured ophthalmologist or professional entity named in the Declarations the data recovery costs incurred during the policy period or within the first two years of any extended reporting period added by endorsement to this policy as a result of a data interference act, but only if such data recovery costs are incurred with OMIC’s prior written consent. OMIC will not unreasonably withhold consent.

This Benefit will only be provided if:

1. The data interference act actually or allegedly takes place on or after the retroactive date and prior to the end of the policy period; and

2. The Insured provides timely written notice of the data interference act to OMIC during the policy period or within sixty days after the expiration of the policy period or within the first two years of any extended reporting period added by endorsement to this policy.

In the event that data belonging to an Insured has been compromised, damaged, lost, erased, eradicated, altered, corrupted, or tainted by reason of a data interference act, the Insured shall, as soon as practicable following notification to OMIC, provide a written statement to OMIC detailing:

the harm or damage known to have resulted from the data interference act;
the circumstances under which the Insured first discovered the data interference act;
the proposed plan for remediation and/or recovery of said data, including the name and identity of the professional or consultant proposed for carrying out the remediation and/or recovery;
the proposed or estimated costs of the remediation and/or recovery; and
the proposed date and time for both commencing and completing such remediation and/or recovery.
No data recovery costs shall be incurred without OMIC’s prior written consent, and OMIC shall not be responsible to pay any data recovery costs that were not so approved. Notwithstanding the foregoing, an Insured may incur data recovery costs without OMIC’s prior written consent if the circumstances are such that there is no practical or reasonable opportunity to obtain OMIC’s prior written consent and the exigencies then and there existing require immediate action to mitigate the potential for damages or harm to an Insured or to third parties.

Definitions. This Section defines various terms used in this Subsection VII.C. These terms are indicated throughout the subsection in bold, italicized print. Refer to Section I. Definitions of the policy for terms that are shown in bold, but not defined below. If a term is defined below and in Section I. Definitions of the policy, the definition below applies to this Subsection VII.C.

1. Claim means:

any written demand for monetary damages or other non-monetary relief against an Insured;
any civil proceeding or arbitration proceeding against an Insured, commenced by the service of a complaint or similar pleading or notification;
any written request to toll or waive a statute of limitations relating to a potential claim against an Insured, including any appeal therefrom; or
any proceedings instituted against an Insured by a government entity, commenced by letter notification, complaint, or order of investigation, the subject matter of which is a privacy wrongful act committed by an Insured.
A claim will be deemed to be first made or instituted when any of the foregoing is first received by an Insured. More than one claim arising out of the same network security wrongful act, the same privacy wrongful act, the same data interference act or related network security wrongful acts, privacy wrongful acts or data interference acts shall be deemed one claim, and such claim shall be deemed to be first made on the date the earliest of such claims is first made. Network security wrongful acts, privacy wrongful acts, or data interference acts will be deemed related if they are logically or causally connected by any common fact, circumstance, situation, event, transaction or series of facts, circumstances, situations, events, or transactions.

2. Data means any and all information stored, recorded, appearing, or present in or on the Insured’s computer systems, electronic communication systems, devices, and telephony, including, but not limited to, information stored, recorded, appearing, or present in or on the Insured’s electronic and computer databases, the Internet, intranet, extranet, and related websites, facsimiles, and electronic mail.

3. Data interference act means any act by a party other than an Insured that occurs during the policy period and is carried out without an Insured’s consent or knowledge, whether intentional, malicious, reckless, or negligent, which act causes harm or damage to the data maintained by an Insured, including but not limited to interference with, or intrusion or incursion into, any of the Insured’s computer systems, electronic communication systems, devices, and telephony, including, but not limited to, the Insured’s electronic and computer databases, the Internet, intranet, extranet, and related websites, facsimiles, and electronic mail.

4. Data recovery costs means all reasonable and necessary sums incurred by an Insured, with OMIC’s prior written consent, to recover and/or replace data that is compromised, damaged, lost, erased, eradicated, altered, corrupted, or tainted by reason of a data interference act, including but not limited to the costs associated with the repair or replacement of any software that is compromised, damaged, lost, erased, eradicated, altered, corrupted, or tainted by reason of a data interference act.

Data recovery costs shall not include: 1) the costs of repairing or replacing any hardware, equipment or wiring; 2) wages, salaries or other compensation or income of any Insured; or 3) the costs of recovering or replacing data for any third party or any data that was not within the care, custody or control of the Insured.

5. Legal expenses mean reasonable and necessary fees, costs, and expenses incurred in the investigation, defense, and appeal of any covered claim; but legal expenses shall not include any wages, salaries, or other compensation or income of any Insured.

6. Loss means money an Insured is legally obligated to pay as a result of a claim. Loss includes damages and judgments; prejudgment and post-judgment interest awarded against an Insured on that part of any judgment paid or to be paid by OMIC; legal fees and costs awarded pursuant to such judgments; settlements negotiated with OMIC’s prior consent; and administrative fines or penalties assessed against an Insured by a government entity as a result of a privacy wrongful act. Loss does not include (1) taxes; (2) any amount for which the Insured is absolved from legal responsibility to make payment to any third party; (3) amounts owed under, or assumed by, any contract; (4) any return, withdrawal, restitution, or reduction of professional fees, profits, or other charges; (5) punitive or exemplary damages or the multiple portion of any multiplied damages; (6) criminal fines or penalties; or (7) any matters that are uninsurable under applicable law.

7. Network security wrongful act means an actual or alleged act, error, or omission by an Insured, including an unauthorized act by an employee, which results in the unauthorized access or unauthorized use of the Insured’s computer system, the consequences of which include, but are not limited to:

a. the failure to prevent unauthorized access to, use of, or tampering with a third party’s computer systems;

b. the inability of an authorized third party to gain access to the Insured’s services;

c. the failure to prevent denial or disruption of Internet service to an authorized third party;

d. the failure to prevent identity theft or credit/debit card fraud; or

e. the inadvertent transmission of harmful or corrupt software code, including but not limited to computer viruses, Trojan horses, worms, logic bombs, spyware, or spiderware.

8. Notification and credit monitoring costs means all reasonable and necessary expenses incurred by an Insured, with OMIC’s prior written consent, in notifying affected individuals of any actual or potential privacy wrongful act, including, but not limited to:

legal expenses;
computer forensic and investigation fees;
public relations expenses;
postage expenses;
related advertising expenses; and
the costs of credit monitoring services provided to affected individuals for a period of up to 12 months from the date of enrollment in such services.
9. Privacy wrongful act means any of the below, whether actual or alleged, but only if committed or allegedly committed by an Insured:

a. breach of confidence or invasion, infringement, interference, or violation of any rights to privacy including, but not limited to, breach of the Insured’s privacy statement, breach of a person’s right of publicity, false light, intrusion upon a person’s seclusion, public disclosure of a person’s private information, or intrusion or misappropriation of a person’s name or likeness for commercial gain; or

any breach or violation of US federal, state, or local statutes and regulations associated with the control and use of personally identifiable financial or medical information, including but not limited to:
The Health Insurance Portability and Accountability Act of 1996 (Public Law 104-191) (“HIPAA”), including Title II which requires protection of confidentiality and security of electronic protected health information, and the rules and regulations promulgated thereunder as they currently exist and as amended, including related state medical privacy laws as they currently exist and as amended;
Gramm-Leach-Bliley Act of 1999 (G-L-B), also known as the Financial Services Modernization Act of 1999, including sections concerning security protection and standards for customer or patient records maintained by financial services companies, and the rules and regulations promulgated thereunder as they currently exist and as amended;
State Attorneys General and Federal Trade Commission enforcement actions regarding the security and privacy of consumer information;
Governmental privacy protection regulations or laws, as they currently exist now or in the future, which require commercial Internet sites or on-line services that collect personal information or medical information (as defined by such laws or acts) to post privacy policies and adopt specific privacy controls or to notify those impacted by identity or data thief, abuse or misuse;
Federal and state consumer credit reporting laws, such as the federal Fair Credit Reporting Act (FCRA); and
The Health Information Technology for Economic and Clinical Health Act (“HITECH ACT”), Title XIII of the American Recovery and Reinvestment Act (“ARRA”) of 2009.
Exclusions. These exclusions are applicable to this Subsection VII.C.:

This Benefit does not apply to any claim, any notification and credit monitoring costs, or any data recovery costs:
based on, resulting from, arising out of, attributable to, or in any way involving:
i. any facts, circumstances, events, causes or situations that (1) are underlying in any litigation, government investigation or proceeding, other notice pending, or any judicial decree or judgment entered; (2) are the subject of notice to an insurer under any other insurance policy; or (3) any Insured or any of his/her/its supervisory level employees knew or had a reasonable basis to know might result in a claim prior to the Insured’s original effective date;

ii. (a) any breach of contract, warranty, or guarantee; or (b) liability of others assumed by an Insured under any contract or agreement. This exclusion 1.a.ii. shall not apply to the extent the Insured would have been liable in the absence of a contract or agreement;

iii. any business, joint venture, or enterprise other than the health care practice of the Insured;

iv. any Insured gaining in fact any profit, remuneration, or financial advantage to which such Insured was not legally entitled;

v. any deliberately dishonest, malicious, or fraudulent act or omission or any willful violation of law by any Insured, if judgment or other final adjudication adverse to the Insured establishes such an act, omission, or willful violation; however, this exclusion 1.a.v. shall not apply to any Insured that did not commit, participate in, or have knowledge of any such act, omission or violation of law described in this exclusion;

vi. any actual or alleged violation of the False Claims Act, or any similar federal or state law, rule, or regulation concerning billing errors or fraudulent billing practices or abuse;

vii. any actual or alleged price fixing, restraint of trade, or violation of any securities or anti-trust laws;

viii. any actual or alleged violation of any of United States of America’s economic or trade sanctions, including but not limited to, sanctions administered and enforced by the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”);

based on, resulting from, arising out of, attributable to, directly or indirectly resulting from, in consequence of, or in any way involving:
i. any actual or alleged electrical failure, including any electrical power interruption, surge, brownout, or blackout;

ii. any actual or alleged malfunction or defect of any hardware, equipment, or component;

iii. any Insured’s actual or alleged failure to render professional services;

iv. loss of business income arising from the interruption, suspension, or degradation of the Insured’s own computer network;

v. (a) any network security wrongful act, privacy wrongful act, or data interference act actually or allegedly occurring prior to the retroactive date; or (b) any other network security wrongful act, privacy wrongful act, or data interference act actually or allegedly occurring on or subsequent to the retroactive date which, together with a network security wrongful act, privacy wrongful act, or data interference act actually or allegedly occurring prior to such date would constitute related network security wrongful acts, privacy wrongful acts, or data interference acts. For purposes of this exclusion 1.b.v., network security wrongful acts, privacy wrongful acts, or data interference acts will be deemed related if they are logically or causally connected by any common fact, circumstance, situation, event, transaction or series of facts, circumstances, situations, events, or transactions.

2. This benefit does not apply to any claim brought by or on behalf of:

any Insured against another Insured;
any entity owned, in whole or in part, by any Insured;
any entity directly or indirectly controlled, operated, or managed by any Insured;
any entity that is a parent, affiliate, or subsidiary of any entity in which any Insured is a partner; or
any person who is a partner or joint venturer in any entity in which any Insured is also a partner or joint venturer.
This exclusion 2. shall not apply to an otherwise covered claim by an employee of an Insured alleging a privacy wrongful act.

Notice of a Potential Claim. If, during the policy period, any Insured first becomes aware of a specific network security wrongful act, privacy wrongful act, or data interference act which could give rise to a claim under this Subsection VII.C., and if the Insured, during the policy period, provides OMIC with written notice as soon as practicable of:

1. the specific network security wrongful act, privacy wrongful act, or data interference act;

2. the nature of the alleged or potential damages;

3. the identity of the potential claimants and any Insured involved;

4. the manner in which the Insured first became aware of the circumstances; and

5. the consequences which have resulted or may result from the network security wrongful act, privacy wrongful act, or data interference act,

then any claim subsequently arising from such circumstances will be deemed first made on the date such notice was given to OMIC.

Coverage Limit. The most OMIC will pay per Insured for legal expenses, loss, notification and credit monitoring costs, and data recovery costs combined is $50,000 for a policy period. Any extended reporting period does not increase the limit; it is shared with the prior policy period. Any payment under this Section VII.C. is a sub-limit of, and reduces the benefits payable under, Section VII.B. Broad Regulatory Protection.

The Additional Benefit pertaining to any HIPAA proceedings or privacy wrongful acts arising out of the same event(s) is afforded either under Subsection B. or C., not both, and only one limit applies (Subsection C. limits are a sub-limit of Subsection B. limits, regardless). OMIC has the sole discretion to determine which coverage provision applies in any event.

* * * * * * * * * * * *

The following changes have been made to and replace Section XI. Endorsements, Part II, OMC121A, in the January 1, 2012, OMIC Professional and Limited Office Premises Liability Insurance policy:

OMC121A – Coverage Classification Endorsement – Ophthalmology – Surgery Class 2
This endorsement incorporates endorsements OMC121B and OMC122 and automatically applies to all Insureds whose class is identified in the Declarations as Ophthalmology – Surgery Class 2.
OMIC and the Insured agree that the policy is amended as follows:

The following exclusion is added to Section II. Coverage Agreement A, Part III – Exclusions, A. No Defense or Payment of Damages or Supplementary Payments:

the performance of any surgical procedures, except for the following surgical procedures permitted in Surgery Class 2: laser capsulotomy, laser iridotomy, laser iridectomy, laser iridoplasty, laser punctal closure, punctal closure with cautery, laser trabeculoplasty, wedge resection for suspected non-cancerous tumors, suture tarsorrhaphy, marginal adhesion tarsorrhaphy without incision into the tarsus, laser ablation of corneal lesions, cautery for conjunctivochalasis, temporal artery biopsy, skin rejuvenation/tightening using non-invasive, non-ablative techniques, blue light acne treatment (with or without use of photodynamic therapy), non-invasive cellulite reduction, periocular injections, periorbital injections, peribulbar injections, retrobulbar injections, and sub-Tenons injections; and the additional surgical procedures permitted in Surgery Class 1 as described in OMC121B. Coverage applies only to the surgical procedures listed above; assisting in surgery; and non-surgical ophthalmology as described in OMC122.

January 2012 Revision of OMIC’s Professional and Limited Office Premises Liability Insurance Policy
Effective January 1, 2012

The following outline summarizes the changes made to the OMIC policy. Any benefits added to the policy take effect as of January 1, 2012. Any changes that may restrict coverage do not take effect until your 2012 policy renewal date.

1. Medical Spas. The policy is updated to specifically incorporate reference to insured Medical Spas and add an exclusion that negates coverage if OMIC’s medical spa requirements are not followed. See pages 7-8 of the policy for more information.

2. ROP Remote Screening Exclusion. The ROP remote screening exclusion is modified to allow coverage by endorsement. See page 13 of the policy.

3. Weight Loss Treatment Exclusion. Weight loss treatment is now excluded under the policy. See page 13 of the policy.

4. Broad Regulatory Protection Policy (BRP) Revision and Addition of eMD Cyber Coverage: The BRP limit is increased from $35,000 to $50,000 per regulatory proceeding. Cyber liability is added as an additional benefit. This eMD™ benefit covers claims based on insured-caused network security and privacy breaches, patient notification and monitoring costs because of such privacy breaches, and costs to recover the insured’s data when it has been compromised by another party. See pages 17-25 of the policy.

5. ROP Exclusion Endorsement. An endorsement is added to the policy to exclude coverage for all ROP services, on a case by case basis. This exclusion applies to you only if endorsement OMC136 is listed on your Declarations page. See page 39 of the policy.

6. Florida Endorsement. The Florida endorsement giving OMIC the right to settle claims without the Insured’s permission (as was required per Florida law) is removed due to changes in Florida’s settlement laws.

7. Indiana Endorsement. The Indiana amendatory endorsement explains how limits are shared when “independent ancillary providers” are insured. See page 42 of the policy.

Download the 2012 Policy using the tool bar above.

Revised TRIA Disclosure Notice and Endorsement
OMIC has revised its Terrorism Risk Insurance Act (“TRIA”) Notice and Endorsement pursuant to the Terrorism Risk Insurance Program Reauthorization Act of 2007 (“TRIPRA”). This Act extends TRIA for 7 more years, to end December 31, 2014. Of significance, TRIPRA has changed the definition of “act of terrorism” and also requires a disclosure that there is a $100 billion cap that limits federal reimbursement and insurers’ liability for insured TRIA losses. The TRIA Endorsement is included with your policy materials. Contact OMIC for a copy of this document.

Revised HIPAA/HITECH Business Associate Agreement
OMIC has revised its OMIC-Insured Business Associate Agreement to comply with the HITECH (Health Information Technology for Economic and Clinical Health) Act. The HITECH Act, part of the American Recovery and Reinvestment Act of 2009, requires Business Associate Agreements to be updated by February 17, 2010, to reflect the changes the Act made to the HIPAA Privacy and Security Rules already in place.

The HIPAA Privacy Rule, which took effect April 2003, required Covered Entities (most OMIC insureds) to enter into Agreements with their Business Associates (of which OMIC is one) that specified how protected health information (PHI) was to be used and disclosed by the Business Associate. At that time, OMIC gave each of its insureds a Business Associate Agreement that complied with the HIPAA regulations. Several years later, OMIC updated its Business Associate Agreement to comply with the HIPAA Security Rule by its deadline of April 21, 2005. The Security Rule outlined the administrative, physical, and technical safeguards Covered Entities and Business Associates must use to protect patient health information that is maintained or transmitted in electronic form.

The HITECH Act has made several additions and changes to the HIPAA Privacy and Security Rules. For example, the Act defines unsecured protected health information, and requires Business Associates to notify Covered Entities (and Covered Entities to notify affected individuals) when there is a breach of this unsecured PHI; it requires the granting of requests by individuals to limit the disclosure of their PHI in certain situations; it changes the requirements for the accounting of disclosures when electronic health records are used; and it sets new limitations on marketing uses and sale of PHI.

In order to assist our insureds, and so that OMIC need only maintain one agreement with all of its insureds, OMIC has updated the Business Associate Agreement it maintains between itself and all of its insureds to comply with the HITECH Act. Contact OMIC for a copy of the revised Agreement.