HCNN Alerts Help Decrease Risk

The Health Care Notification Network (HCNN) prepares to launch its first alert to physicians this week. Expect HCNN to send the alert to over 800,000 physicians and physician assistants. Since launching in March, the network has added over 40 healthcare organizations and societies and over 50 medical malpractice companies. These companies hope this new way of informing physicians about recalled drugs will stave off potential claims. Some of the participating carriers include American Physicians Insurance (API), CNA, First Professionals Insurance Co. (FPIC), MAG Mutual, MD Advantage, The MMIC Group, Physicians Liability Insurance Co. and PMSLIC Insurance Co.

Look for HCNN to expand its network to include pharmacists in 1Q 2009. Until then it will be up to the physicians to ensure they don’t prescribe medication that has been recalled. In Utah the state Supreme Court ruled that a pharmacy could be held liable in negligence for continuing to fill prescriptions for a drug that has been withdrawn from the market by the FDA. Those that insure pharmacists that could potentially benefit from this are the Pharmacists Mutual Insurance Co. (PhMIC), The Chicago Insurance Co. and James River, which writes coverage for pharmacists with more unusual exposures such as prescribing recalled drugs.

The 12 organizations that HCNN added in the last month include the American Academy of Physician Assistants, the American College of Emergency Physicians, the American Medical Association, the American Thoracic Society, Bayer, The Endocrine Society, the Medical Society of New York, MxSecure, the Oregon Medical Association, UPMC and the Washington State Medical Association. HCNN is governed by the nonprofit organization, iHealth Alliance, and Medem provides the network operations for HCNN under contract with iHealth. HCNN not only sends electronic alerts, eliminating paper waste and ensuring physicians receive alerts the day they are announced, but the network is also able to send out national public emergency notices to reduce the potential for lawsuits.

PhMIC is a significant player in the professional liability market for pharmacists. The A-rated carrier holds licenses to write policies across the country, except in Alaska, Florida, Hawaii and New York. Its policy stats include $1 million/$3 million limits, claims made and defense costs outside the limits of liability. Premiums average $145 a year per policy. The Iowa-domiciled carrier gives discounts for newly-graduated pharmacists and some pharmacists can receive a $5,000 level term life insurance policy through The Pharmacists Life Insurance Co. PhMIC was admitted into California earlier this year.

Marsh Affinity oversees Chicago Insurance Co.’s book of business. Marsh bought it out four years ago and has taken into consideration certain aspects of the risk exposure. Prescribing recalled drugs could be one of them. Expect Marsh and the Chicago Insurance Company to be one of the first pharmacist insurers to support HCNN once it rolls out alerts for them. Coverage for pharmacists is available throughout the country on an occurrence basis. The policy covers anything within the scope of a pharmacist’s license. An average policy has $1 million/$3 million limits and costs roughly $151 annually. A policy with limits at $2 million/$4 million could cost around $177 a year. The carrier gives a 10 percent discount to pharmacists who are members of the American Society of Health System Pharmacists (ASHP). It also gives discounts for first-year pharmacists. Group discounts are available. A discount of 4 percent is offered for groups of two to nine, groups of 10 to 14 receive 8 percent off and groups larger than 15 get a 12 percent discount.

James River takes care of the pharmacists on the non-admitted basis. Coverage is offered to hard-to-place pharmacists in all states except New Hampshire and Ohio. The E&S carrier will write staffing services that place pharmacists and pharmacy technicians on a temporary basis. James River can write coverage on a claims-made form and on an occurrence form. Limits are typically set at $1 million/$1 million, but can go up as high as $5 million/$5 million. James River is also flexible with the defense costs, allowing insureds to choose to have it either inside or outside the policy limits. The minimum premium for a pharmacist policy is generally $7,500. Coverage is not only available to non-standard pharmacists, but James River will also insure online pharmacies and pharmacists who do their own chemical compounding.