Risk Management

Anatomy of a Claim

By Marilys Fernandez, RN, Esq., Digest, Winter, 1991

Medical malpractice claims are expensive, time consuming and emotionally trying for the physician involved. They often call into question not only the physician’s medical skill but his or her integrity as well. It is at this point when the physician may be feeling angry, confused and most in need of support that the benefits of a physician-sponsored company such as OMIC are most apparent.

Streamlining the Claims Process

The claims management system of the Ophthalmic Mutual Insurance Company (OMIC) typically cuts through the red tape and streamlines what could otherwise be a frustrating and stressful adversarial process. The result is a more responsive, personalized system designed not just to provide competent legal defense, but to reduce the anxiety and alienation that accompany a malpractice action. Realizing that open communication with the insured is a key element in successfully managing a case, the claims staff strives to keep the policyholder involved and informed frequently throughout the entire claims process.

The claims management philosophy is consistent with the origin and purpose of OMIC’s creation – to provide long-term insurance stability and personal attention to insured members of the Academy in an unstable medical-legal environment. OMIC is the only professional liability insurer exclusively for ophthalmologists and the only one sponsored by the American Academy of Ophthalmology for its members. OMIC’s Board of Directors are all practicing ophthalmologists and members of the Academy.

Reporting a Claim

The action taken when a physician first learns of an untoward medical event can be a critical factor in avoiding, reducing exposure or successfully defending a claim. An OMIC insured should immediately report a claim or potential claim by calling a toll-free OMIC number: 1-800-562-6642. The ophthalmologist will be asked to give a brief description of the incident to the claims staff who will then explain the claims process and provide further instructions on how to proceed.

Once insurance coverage is confirmed and a formal claims file is created, the physician is typically next asked to forward a copy of the patient’s medical records and any other information regarding care and treatment of the patient. Instructions will be given at that time with respect to patient confidentiality and the appropriate release of records. The claims manager may conduct a detailed interview over the telephone or, in some instances, assign the case to a local adjuster to set up a personal meeting with the insured.

It may be necessary for the claims manager to communicate directly with the claimant or claimant’s attorney to request additional information regarding the nature of the injury and damages allegedly sustained by the claimant. This may include supplementary medical records, x-rays or reports from other physicians who subsequently treated the patient.

Physician Reviewers

After the initial claims investigation, an ophthalmologist from the OMIC Claims Committee reviews and evaluates all the records. This reviewer attempts to provide an objective review of the strengths and weaknesses of the medical care rendered. OMIC reviewers, who like all OMIC insureds are members of the American Academy of Ophthalmology, represent various ophthalmic subspecialties and are assigned to cases that closely match their own expertise.

To Settle or Not to Settle

Once the investigation is completed, OMIC evaluates the claim, confers with the insured and makes a preliminary determination on how to proceed. If in the Company’s assessment of liability, the case appears defensible, the claim will be denied. If, on the other hand, it is believed that the insured is likely to be found liable, settling the case out of court may be recommended. However, consent from the insured is required before any claim is settled, pursuant to the terms of the OMIC insurance policy.

OMIC’s philosophy is to vigorously defend cases in which the insured has rendered appropriate care. Nuisance or so-called economic settlements only encourage frivolous litigation. On the other hand, if it is in the best interest of the insured to settle and the insured agrees, a prompt settlement will be attempted. However, since facts develop as a case proceeds, settlement of a case can occur anytime during the litigation or pre-litigation process: during the discovery phase, prior to trial, during trial or after trial.

Selection of Defense Counsel

Oftentimes, the first notice of a claim is the filing of a lawsuit by the plaintiff and the service of a Summons and Complaint on the physician. When this happens, the Company will retain counsel to render a defense on behalf of the OMIC insured. Counsel is chosen from a pre-approved list of attorneys with particular expertise in defending medical malpractice ophthalmology cases. This special panel of defense attorneys is likewise committed to aggressively defending all malpractice actions which the company believes could be resolved in the physician’s favor.

OMIC is also committed to the principle that the defense counsel’s client is the insured ophthalmologist and not the insurance company. Accordingly, defense counsel is expected to act responsibly and in the best interest of the insured physician. This includes keeping the insured involved in all aspects of the litigation, significant case developments and expert selection. The appointed attorney conducts all meaningful discovery, confers with the Company and the insured on defense strategy, and ultimately defends the case for those claims which proceed to litigation.

The Company takes great care when advising a physician about the ramifications of any settlement. Due to the reporting requirements of the National Practitioner Data Bank (NPDB), the claims manager reviews any report on claims payment with the physician before filing it with the NPDB.

After Claims Closure

The claims department’s job is not finished once a claim or lawsuit is brought to a final resolution. Data gathered from each claim is codified so information may be compiled on claim frequency and practice errors as they apply to ophthalmologists. This information is used by OMIC in its loss prevention efforts and risk management services.

The effective resolution of a claim can only be achieved by frequent communication between the policyholder, the claims manager and the attorney. In the spirit of this philosophy, OMIC will continually work to evaluate and improve the claims management process so that it remains responsive to the evolving needs of OMIC-insured ophthalmologists and members of the Academy.