A message about factors influencing malpractice claims and cases

A large aspect of TDIC leadership’s role is to keep dentists at the heart of our decision-making. And another aspect is to help translate what’s happening in the insurance landscape and our company. We’re here to make it easier to navigate insurance and connect the dots between larger trends and impacts to your practice. Today, I want to share factors that are influencing malpractice coverage, claims and cases. Insurance carriers, and the health care providers they protect, are entering a new era.

As you may have heard, TDIC was founded in 1980 in a climate of soaring malpractice premiums. We were, and always will be, committed to fair rates, transparency and dentist-focused service. Over the years, we’ve stayed ahead of the evolving profession, regulations and policyholder needs while ensuring financial stability and security.

While the insurance market has stabilized over the past 40 years, rising factors are pushing loss severity to twice the rate they were a decade ago. There are three emerging and accelerating trends you should know about:

First: nuclear verdicts. There’s been a post-pandemic rebound in malpractice claims, as well as high awards for anesthetic reaction, nerve damage and missed or mishandled oral cancer cases. A nerve injury case, the type which may have been settled in the past, was awarded a multi-million-dollar verdict last fall. Another case which would likely have been settled at $150,000 was awarded $350,000 recently.

So, what changed?

There’s certainly been a big shift in public opinion about health care organizations and trust in institutions overall. That frustration and mistrust, often expressed on social media, carries over to juries. In addition, medical advances can mean higher awards for plaintiffs’ long-term injury and care costs.

Next: inflation. While many malpractice claims aren’t litigated, those that do reach court have seen up to a 40% increase in defense attorneys’ rates over the last several years.

And third: regulatory influences like increased damage caps.  The Medical Injury Compensation Reform Act put essential cost-control guardrails in place to protect health care providers in California. A revised framework a few years ago ensured stable, long-term legal protection with phased increases to the caps.

By next year, the caps will have effectively doubled through incremental increases – from $250,000 for medical malpractice claims in 2022 to $510,000 in 2027. Not only is there a higher ceiling, but litigants may often “inflate” the damage claims to reach the new cap. The same claim that would have settled for $200,000 may now settle in the $300,000 range. MICRA remains a critical protection for providers and the revised framework has created predictability, but the incremental increases combined with the other factors I’ve noted do impact costs.

These may all seem like large market factors outside of your control. And, in fact, they are steep challenges for all insurers to navigate, especially those who protect health care providers. However, there are steps that you can take to reduce your claims exposure, and the severity of the claims that due occur, as well as “cool the temperature” of the malpractice climate.

• Chairside manner matters. Empathy and clear communication lessens patients’ desire to sue. Your approach to a dental treatment dispute can lead to quicker resolution. Demonstrating that you care and did everything possible to provide treatment and correct a situation or misunderstanding will go a long way in a jury’s perception.
• Current, accurate coverage matters, too. If your insurance carrier doesn’t have a true understanding of the anesthesia modalities and treatment options in your practice, it can’t be reflected in your policy. Factors you can control are providing care within your scope of licensing and covered modalities. Any time you have a change in treatment offerings or locations, your policy needs to change to keep pace. And if you’re unsure, reach out to an insurance advisor. They’re here to help decode and inform your coverage decisions.

The big shifts in our society, perspectives, regulations and economic environment mean big decisions for insurance carriers, too. We’re charged with balancing fair rates with the rising costs of protecting our policyholders and the responsibility of sustaining a strong and stable company for many years to come.

If you have questions or need support with your malpractice coverage, know that our dentistry-focused experts and advisors in your region are here for you.