In the News

Free Alert System May Impact Premiums


By Kirk Gaylord
April 21, 2008


More than three dozen med mal insurers support the new Health Care Notification Network (HCNN). HCNN sends medical practitioners’ notices, or alerts, of adverse drug outcomes that have become known after the drugs reached the marketplace. Alerts range from patient safety notifications to drug recall notices. Providing an immediate electronic notice to physicians gives the doctors an opportunity to immediately notify their patients who are taking the medications, thus reducing the physician’s liability exposures. Expect the long-term outcome to have a positive impact on med mal rates. Fewer med mal claims should be filed against HCNN-subscriber doctors and their insurers. Drug companies could also face fewer plaintiffs in class action suits if some of those patients were removed from the drug’s use as soon as adverse outcomes became known.

Medical malpractice insurers supporting the HCNN project include large organizations such as MLMIC, ProAssurance Corp., The Doctors Company (TDC), ProMutual Group and NCMIC, as well as smaller regional and single-state writers such as COPIC, Kansas Medical Mutual, NORCAL Mutual, State Volunteer of Tennessee, Utah Medical and West Virginia Mutual. HCNN finds support coming also from medical organizations including the American College of Surgeons and the American Cancer Society, as well as from payors including Blue Cross Blue Shield entities and Aetna.

HCNN is an electronic notification system, replacing paper-based alerts sent to physicians and other healthcare providers. Alerts include medication recalls, warnings and national public health issues. The system allows the subscriber, whether a solo physician or a large entity operation, to relay the alert to employees. The alert system is free to recipients. It is paid for by the companies that use the system to send the notifications. This could save these companies time and money when the costs are compared to sending paper notices through the traditional mail system. HCNN meets the Food and Drug Administration’s new guidance for electronic communication of patient safety notification.

Med mal insurers cannot require that their physician-insureds join HCNN but expect the insurers to encourage doctors to sign up. This past January TDC sent information about the HCNN system to TDC’s 40,000 insured doctors. TDC expected to send another mailing before mid-April. TDC is piloting the program with a large physician group and expects the program to eventually reduce premiums. When, and if, the pilot proves that the use of HCNN lowers med mal costs through improved patient safety, med mal premiums could be reduced.

Physicians typically received two to four notifications monthly under the paper system. The number of notifications is growing and that helps create the need for a faster delivery system. Medem Inc. provides the network operations for HCNN.