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"Free Money"
By Margaret Lee Covey
Associate General Counsel

Not without careful consideration, and not without adequate liability protection.

Each of these examples involves a situation in which the physician may not be adequately protected against the risks he or she is incurring. MPT provides professional liability coverage to its members pursuant to the terms of the MPT Agreement. Dues-paying members of CAP are also entitled to the benefits of two insurance policies that provide additional liability protection for their practices.¹ While these benefits supply physicians with broad liability protection, they may not confer coverage for all claims based on the conduct in these examples.

In the first example, the herbal supplement may interfere with a prescriptive agent. The herbal supplement may be misused, may be improperly formulated, or may cause a reaction in the patient that was inadequately identified on the label. As a “seller” of an herbal supplement, the physician may be subject to product liability laws that are not governed by MICRA. (This might not only increase the likelihood but also the amount of an adverse verdict). Further, the MPT Agreement does not provide coverage for the distribution of medications as a seller. If the patient is injured, these physicians could be held legally responsible for damages that result from the use of the supplement, under a “products liability” theory.

In the second example, information necessary for a comprehensive evaluation may not be available or may be inadequately communicated. Patient preferences or concerns may not be considered. As an internet health care provider, the physician may be exposed to medical malpractice laws in states that do not provide the same protection to physicians as in California. If the patient is out-of-state, the physician will not be entitled to the protections provided by the MPT Agreement. If the patient relies upon your second opinion to accede to a course of treatment and is injured, you could be held legally responsible for damages that result from that treatment.

In the third example, business or financial decisions may be made without the physician’s knowledge. Health care personnel employed by the business may be inadequately trained or negligently hired. As the Medical Director for another’s business, the physician may not be entitled to the protections provided by the MPT Agreement. If a patient is injured, you could be held legally responsible for damages that result from the patient’s contact with the business.

The liability risk is substantial. Even when adequate liability protection is procured, the physician may be embroiled in costly, time-consuming litigation to defend claims resulting from any of these examples. CAP, therefore, recommends that any decision to accept one of these (or countless other) offers be made only after careful consideration – and with the assistance of competent legal counsel.

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¹ The MEDefense policy provides reimbursement of legal expenses incurred as a result of disciplinary proceedings instituted by certain governmental agencies against a physician that is based on the competence or professional conduct of the physician. The Employment Practices Liability Insurance (E.P.L.I.) policy provides coverage liability based on acts constituting discrimination, harassment and inappropriate conduct. Each policy has its own maximum limit and each is subject to its own terms and conditions.