Seven Things To Know When You Receive A Notice Of Investigation From The Department Of Health

Nursing Malpractice Insurance

NURSING PROFESSIONALS CANNOT AFFORD TO NOT
CARRY NURSING MALPRACTICE INSURANCE

By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

Nurses: Please Protect Yourself With Professional Liability Insurance.

I am writing to strongly encourage you to purchase nursing professional liability insurance that covers you for complaints and investigations initiated against you and your nursing license.

I am not affiliated with any insurance company. I am not receiving any commission, fee or reimbursement for writing this article. My concern lies in the many, many nurses who contact our firm with Emergency Suspension Orders, Notices of Investigation, Administrative Complaints and Final Orders from the Department of Health, Board of Nursing, who do not have the funds to hire an attorney to defend themselves.

Your Employer Will Likely NOT Provide Legal Defense.

Many nurses mistakenly believe that their employer insures them for these types of events or that their employer will provide a legal defense. In the vast majority of cases, this is false. Often it is the employer that files the complaint against the nurse that causes the investigation. If you are told your employer will cover you in such circumstances, ask for a letter in writing and signed by the employer stating that the employer will pay for your defense in any Department of Health investigation or subsequent administrative proceedings that arise out of your employment. It is unlikely that you will get it.

You Need an Experienced Health Law Attorney to Defend You and Your License.

You need an experienced attorney to represent you in any sort of Department of Health complaint investigation from the very beginning. The administrative law process is complex, especially when there is an Emergency Suspension Order or Administrative Complaint. It is easy for a nonlawyer to be confused and to waive important legal rights that result in discipline on your license, requirements that cannot be met or the revocation of the nursing license.

For example, many nurses believe that if they elect an informal hearing, they will be allowed to go before the Board of Nursing and argue the facts of their case to their peers. This is not true. If you elect an informal hearing, you are admitting that all material facts stated against you in the Administrative Complaint are true (in effect you are pleading guilty). You will only be allowed to argue about what discipline should be taken against you since you have admitted to the offense(s). You have waived your right to a “formal hearing” where you are allowed to testify and introduce evidence to show you did not commit the offenses.

If you receive an Emergency Suspension Order and you believe you can successfully appeal it, you might be surprised. Any such appeal is a formal legal appeal to a Florida District Court of Appeal (DCA). This is a very formal procedure that only examines legal errors made by the Department of Health, Board of Nursing, in taking the action it took. Furthermore, everything stated in the ESO is assumed to be true for the purpose of the appeal. You are not allowed to dispute the facts stated in the ESO.

An appeal requires formal legal research and analysis, the preparation of legal briefs that comply with strict appellate rules of procedure. Most nurses do not have a clue how to do this. Even among attorneys, the practice of filing and arguing appeals is considered to be a legal specialty because of its complexity.

Additionally, there are other actions that an experienced health attorney may take, if you have an ESO or Final Order, that may be far more effective and expeditious to obtain relief for you than appealing it.

Regardless, if you do not have the money (usually $10,000 or more) or insurance coverage to retain the services of an experienced attorney to represent you, you may have little hope of successfully defending yourself from untrue or unjust complaints, from preventing an undesirable result, or from obtaining relief from an ESO or Final Order.

What Does Your Professional Liability Insurance Include? Can you Choose Your Own Attorney?

If you have professional liability insurance, make sure it includes legal defense coverage for professional licensing defense and other administrative proceedings in an amount of coverage of at least $25,000.00. If it does not, you should be able to purchase a “rider” or additional coverage from that insurer for a small additional premium. Also, attempt to obtain “broad form coverage” that will also pay for your legal defense costs for other types of regulatory and administrative proceedings such as: a) an internal hospital/facility peer review proceeding; b) a Medicare or Medicaid audit or investigation; c) a Medicare medical quality assurance investigation or review; d) an EEOC discrimination or harassment complaint or investigation; e) an alleged HIPAA privacy violation; f) a hospital clinical privileges action (if you have privileges); g) action to exclude you from the Medicare or Medicaid Program; or h) action to suspend or revoke your DEA registration (if you have one). There are some insurance companies that sell professional license defense and defense costs and expenses for other types of administrative proceedings as a stand-alone insurance policy.

At the very least, however, you should have the basic coverage to defend you in a complaint against your nursing license.

You should also check with the insurance company before you purchase a policy to determine if the insurer will allow you to choose your own attorney in a licensure defense action. Some insurers may require you to use the attorneys with whom they contract, removing your ability to make this decision.

Professional License Defense Coverage for Nurses.

Insurance companies that we are aware provide professional license defense coverage for nurses, include the following:

  Nurses Service Organization (NSO) Insurance
  Proliability Insurance Co. (endorsed by the ANA)
  NurseGuard Insurance from Granite State Insurance Company
  Healthcare Providers Service Organization (HPSO) Insurance
  CPH Insurance
  MAG Mutual
  The Chicago Insurance Company

Nursing malpractice insurance that contains professional licensure defense coverage is inexpensive and can be easily and quickly obtained online. The premium payments for this type of insurance for an R.N. or L.P.N. is usually less than $250 per year. Monthly payment plans are usually available.

We highly recommend that every nursing professional purchase it, even if you work for a hospital, the state or federal government, or in an administrative position.

Other Resources

Butler, T.: “Nurse’s Professional Liability Insurance,” LoveToKnow.com, at:
http://insurance.lovetoknow.com/Nurse%27s_Professional_Liability_Insurance

Chapman, D.: “Professional Liability Insurance For Nurses – Important Facts,” (GoArticles.com, Jan. 30, 2012) at:
http://goarticles.com/article/Professional-Liability-Insurance-For-Nurses-Important-Facts/6021710/

“Frequently Asked Questions about NP Liability Insurance” at:
http://www.acnpweb.org/i4a/pages/Index.cfm?pageID=3468

MacKay, T.: “Worried About a Malpractice Lawsuit? The Board of Nurses Should Worry You More,” at: http://www.healthlicensedefense.com/WorriedAboutaMalpracticeLawsuit.html

Wood, D.: “Do Nurses Need Their Own Professional Liability Insurance?” (AMN Healthcare, Inc., 2011), at:
http://www.travelnursing.com/news-and-features/print-article/do-nurses-need-their-own-professional-liability-insurance/32984

(revised 5/4/2012)

Disclaimer: This article is for information purposes only and does not constitute legal advice.

© Copyright 2012 by George F. Indest III, Board Certified by The Florida Bar in Health Law, The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, Florida 32714. Phone: (407) 331-6620. All rights reserved.

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law. He is the President and Managing Partner of The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

Tag words: Florida Board of Nursing, Department of Health (DOH) Investigation, investigator, nurses, nurse practitioners, certified registered nurse anesthetists (CRNA), disciplinary action, legal defense, nursing license, attorney, administrative complaint, administrative charges, nursing insurance, malpractice insurance

By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

There are articles out there on why nurses should not buy professional liability insurance. However, in our opinion, there are many excellent reasons why every practicing nurse should carry professional liability insurance.

Most articles on this issue take the side that if a nurse has a professional liability insurance policy, this will give her a “deep pocket” and make her more likely to be sued in a medical malpractice case against a physician or a hospital. The authors of those articles also look at these issues as nurses are usually employees of hospitals and other healthcare entities and, therefore, their employers will provide a legal defense for them. This latter theory relies, in part, on the legal principle of vicarious liability or respondent superior, which means that the employer is liable for the negligence of the employee; therefore, the employer has a vested interest in defending the nurse from civil claims.

There are several important facts which these articles often overlook which, in our experience, strongly indicates that a practicing nurse should purchase her own professional liability insurance policy.

The Primary Reason for Coverage: To Provide Legal Defense for a Complaint Against the Nurse’s License.

The primary reason that a nurse should purchase a professional liability insurance policy is that this type of insurance usually includes coverage for legal defense of licensing and disciplinary action commenced against a nurse. Although most nursing liability insurance includes this coverage automatically, some policies may not. Some insurance companies may offer this type of coverage separately to be purchased for a small additional premium payment.

License defense coverage pays the legal fees and costs associated with defending a nurse when an investigation is initiated that may result in action against her nursing license or disciplinary action against the nurse. Coverage is usually available from the time the nurse receives written notice than an investigation by a state agency has been initiated. It will also cover formal complaints made against the nurse, informal hearings before the Board of Nursing, and formal administrative hearings before an administrative law judge.

Since such investigations, complaints, and administrative action may be opened based on such events as patient complaints, hotline calls, Code 15 reports, nursing home and home health agency surveys, abuse investigations by the Department of Children and Families (DCF), newspaper articles, copies of lawsuits, and many other sources. It is far more likely that a nurse will be involved in one of these types of actions than that a nurse will ever be sued for nursing negligence.

As noted above, an investigation against a nurse’s license may arise from a number of different sources. Statistics provided by the Medical Quality Assurance Division of the Department of Health (DOH) indicate that for the one year period from July 1, 2001 through June 30, 2002, a total of 1,142 investigations were initiated against nurses. For the one year period from July 1, 2002 through June 30, 2003, a total of 1,302 DOH investigations were initiated. Figures were not available on the number of nursing malpractice lawsuits that were initiated during the 2001-2002 period. However statistics obtained from the Department of Health indicate that during the period from 2002 through 2003, only 51 suits for nursing negligence were filed against nurses. We could locate no statistics that indicated the number of notices of intent to initiate malpractice litigation that may have been served on nurses during this period of time; however, a defense for the nurse in these cases would also be covered by such policies. These statistics indicate that a nurse is more likely to be involved in one of these types of licensing actions rather than a lawsuit alleging nursing negligence. These figures show that a DOH investigation is 26 times more likely against a nurse than a malpractice lawsuit.

Professional liability policies which provide coverages for licensure defense will usually provide compensation to the nurse for her out-of-pocket expenses (travel, postage, etc.) that she herself incurs as well as lost wages because of working time missed for hearings, depositions, etc. However, the maximum coverage available under such policies for licensure defense is usually limited. Usually coverage for licensure defense in most policies for nurses is between $10,000 and $15,000. This amount will usually be sufficient to provide for most of the legal fees and costs involved in defense of such a case and will usually be enough for the nurse to be able to afford to hire a highly qualified, experienced healthcare attorney, familiar with nursing law, to represent her.

The assumption that vicarious liability or the legal doctrine of respondeat superior protects a nurse against a medical negligence claim is a mistaken one. If the employer provides legal representation, the attorney representing the nurse will almost always be the same attorney representing and being paid by the hospital or employer.

In many circumstances, the nurse may conclude that her interests are contrary to those of the hospital or employer, which could result in the attorney hired by the hospital withdrawing from further representation of the nurse. Additionally, it may be necessary for the nurse to raise evidence showing that the injury was caused by another nurse or hospital employee, in order to defend herself. It is doubtful that an attorney representing the employer or hospital would raise this defense since it would prove liability against the employer hospital.

Many employers will not provide legal representation if the matter involves licensing or disciplinary action against the nurse. This could force the nurse to fund all the fees and costs associated with her defense. However, some larger corporations with good risk management programs will provide the nurse with legal representation for such matters.

For example, the authors of this article have represented large national hospital chains and nursing home chains, as well as a local independent nursing home, which routinely provide legal representation for nurses accused of wrong-doing who have a complaint filed against them with the Board of Nursing, Department of Health, or the Department of Children and Families. The authors have also been retained as independent outside counsel to represent nurses by large national nursing home chains and hospital chains when it was felt that there might be a conflict of interest between the corporation and the nurse. This situation might arise, for example, if the nurse is suspected of having committed a criminal act or an intentional act that might also result in civil liability or discipline against the nurse.

If you are an agency nurse, a home health agency nurse, a nursing home nurse, an independent duty nurse, or you are not employed by a large hospital chain, then you should consider nursing liability insurance mandatory. It appears that complaints of negligence against nurses working in these positions are far more likely. This may be because of the high turnover of nurses in some types of healthcare facilities (such as nursing homes), or because when the incident is investigated, the nurse is no longer employed there (for example, in the case of an agency nurse). Additionally, agency nurses may only work in facility for a short period of time making them less familiar with the facility’s policies and procedures, and not a part of the permanent team of nurses who may have established relationships with each other and are more likely to cover for each other.

As mentioned above, a number of different proceedings may be covered by the licensure defense coverage provided for in professional liability insurance. These proceedings may include an investigation by the Department of Health based on a patient complaint or Code 15 report; an abuse investigation (abuse of a child, abuse of a developmentally disabled or vulnerable person, or abuse of an elderly person) by the Department of Children and Families (DCF); allegations of nursing negligence or abuse being investigated by a state “surveyor” by the Agency for Health Care Administration (AHCA); an investigation into allegations of Medicaid over-billing or fraud; an investigation by the Agency for Health Care Administration or on the Attorney General’s State-wide Medicaid Task Force; and allegations of improper Medicare billing or fraud.

A nurse might be involved in a Medicaid fraud investigation, for example, in the case of an Advance Registered Nurse Practitioner (ARNP), Certified Registered Nurse Anesthetist (CRNA) or Certified Nurse Midwife (CNM) who has her own provider identification number and is allowed to bill as part of a group practice or independently. This might also occur, for example, in the case of a nurse working for a home health agency which receives its reimbursement for the nurse’s services from Medicare or Medicaid. We have represented nurses in each of these types of cases.

High limits of coverage for nursing malpractice insurance coverage are usually available. Most nursing liability insurance policies provide at least $1,000,000 in coverage. If sought by physicians, this high limit of coverage may be very expensive or often is not available, at all. This professional liability coverage should afford the nurse ample protection in any malpractice case that might be filed against her. When counseling physician clients regarding asset protection, we routinely advise them that the best asset protection is having and maintaining good professional liability insurance coverage. There is no reason that this should not apply to a nurse who may have property, savings or other assets she desires to protect.

Nurses can purchase liability coverage rather inexpensively. For example, an excellent insurance policy providing coverage for nurses is available through the Nurses Service Organization (N.S.O.) for less than $100 per year. Professional liability coverage provided by this type of insurance represents a bargain at these rates.

Perhaps most importantly, the nurse should have an attorney focusing on her interests only in defending her against any type of negligence or licensing complaint. A nurse with her own professional liability insurance coverage will be able to hire a separate, independent attorney, and often the insurer will allow her to pick her own attorney.

Additionally, it has been our experience that it is better to have several different defense attorneys actively involved in a case rather than to have only one, when defending multiple parties. Having several defense attorneys involved means that the attorney representing the plaintiff (or person filing the claim) has to work much harder in order to prove her case. During the discovery process, each defense attorney is allowed to separately question both fact and expert witnesses. Each separate defense attorney is allowed to file discovery requests. Each separate defense attorney participates in the filing of motions. Relevant facts or issues that are overlooked by one attorney may be picked up by other defense attorneys. A cohesive defense with a unified strategy stands a greater chance of prevailing both before and at trial.

When deciding on which professional liability to purchase, the nurse should inquire as to the extent of coverage for licensing in disciplinary defense coverage. Some professional liability insurers have a “broad form” of coverage which may provide legal defense for the nurse in almost any type of administrative action. This might include, for example, defense of a discrimination complaint filed against the nurse with the Florida Commission on Human Relations (FCHR) or the U.S. Equal Employment Opportunity Commission and for Medicare and Medicaid complaints. Other companies limit coverage to only actions that may result in disciplinary action against the nurse’s license. The nurse should always attempt to get the broadest coverage available for disciplinary defense and licensure defense coverage.

Additionally, the nurse should inquire as to whether or not she will be allowed to select her own attorney. Many insurance companies have contracts with certain law firms to provide legal services on their cases for a reduced fee. The insurance company may require you to use one of its own contracted attorneys, or even one of its in-house attorneys which it employs directly. Given the limited number of attorneys with experience at handling nursing law issues and trying malpractice cases, the nurse should attempt to obtain coverage through a company which allows her to choose her own attorney.

The most important reason to purchase professional liability insurance is for the licensure defense coverage. A nurse does not want to risk losing her nursing license because she was unsuccessful at defending an investigation against her license or did not have the resources to do so. Since there are far more complaints filed each year against nurses’ licenses than here are nursing malpractice lawsuits, it is far more likely that a working nurse will need legal defense of a licensure complaint investigation.

The Health Law Firm’s attorneys routinely represent nurses in Department of Health (DOH) investigations, in appearances before the Board of Nursing in licensing matters and in many other legal matters. We represent nurses across the U.S., and throughout Florida.

To contact The Health Law Firm please call (407) 331-6620 or (850) 439-1001 and visit our website at www.TheHealthLawFirm.com.

About the Author: George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law is an attorney with The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Avenue, Altamonte Springs, Florida 32714, Phone: (407) 331-6620.

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