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Changing Employers? Keep Your Tail Covered!

A common question regarding employment, and particularly changes in employment, revolves around the idea of tail insurance coverage.  As such, this issue’s legal column explores what tail coverage is, why you need it, and who pays for it.

In general, there are two types of medical malpractice insurance policies: (1) claims made policies and (2) occurrence policies.  If an advanced practice nurse (“APN”) has a “claims made policy,” this means that the insurance will cover any claims that are made against the APN while that policy is in effect.  However, it will not cover claims that are made after the policy is terminated (i.e. the APN moves to a new practice or the practice changes carriers).  Anyone with a “claims made” policy should purchase a “tail” policy to be effective once the original policy ends.  The tail policy will extend insurance coverage for a set amount of time in order to protect the APN against lawsuits that may be brought at a later date even though the original policy is no longer in effect.  This tail should be purchased regardless of specialty.  In general, it is best to negotiate who is responsible for purchasing the tail before entering into an employment agreement.  Otherwise, the APN will likely hold full responsibility for purchasing the tail, unless his/her new employer will purchase it or a severance package can be negotiated with the former employer that includes tail coverage.

If an APN has an “occurrence policy,” this means that the insurance will cover any claims made against the APN for incidents that occurred while the policy was in place.  (A lawsuit will still be covered after the policy ends, so long as the actual incident at issue occurred while the policy was in effect.)  In this case, there is no need to purchase a tail policy, because the occurrence policy will continue to protect the APN for incidents that happened while the policy was in place.  This type of policy is becoming rare.  Most places now carry a “claims made” policy, but there are a few “occurrence policies” still used.

SHORT ANSWER:  Anyone coming off of a “claims made policy” should purchase a tail.

STRATEGIC TIP:  It is best to negotiate who will buy the tail during employment contract negotiations before employment even commences.  There are many ways this can be structured.

Article by Jeana M. Singleton taken from the OAAPN Newsletter Challenge, September 2009

BMD's 2018 Florida Rising Stars

BRENNAN, MANNA & DIAMOND is proud to announce ALESSANDRO A. APOLITO, MATTHEW T. JACKSON and JOSHUA R. La BOUEF, have been selected as 2018 Florida Rising Stars for Business Litigation.

How bringing baseball to Akron launched a career of dealmaking

Baseball changed Tony Manna’s life. More specifically, bringing minor league baseball — and a new stadium — to Akron. “When I completed that deal, I remember a guy told me, ‘Your whole life is going to change because of this deal and the notoriety that comes with it,’” recalls the CEO of real estate developer Signet LLC. “He was absolutely right about that.” In this week’s Master Dealmaker, Tony shares his approach to dealmaking, the team he’s built and how pillow talk can play in the success or failure of a business deal.

Social Enterprises Show Us that Business with a Purpose is Possible

On Feb. 17, the Young Lawyers Section of The Jacksonville Bar Association held its Ninth Annual Young Lawyers Section Chili Cook-Off at the Riverside Arts Market, which benefited Rethreaded, a local nonprofit.

BMD's Daphne Kackloudis Drafting Legislation Seeking Additional Funding for Children Born Addicted to Opioids

BMD's Daphne Kackloudis has been working with her client, Brigid's Path, to help them gain access to additional federal funds for their mission. She has drafted legislation which would do just that. The CRIB Act would amend the Social Security Act to allow Medicaid reimbursement for residential pediatric recovery centers such as Brigid's Path. Congressman Turner is going to ask Sen. Portman to amend his opioid bill (CARA 2.0) to include the CRIB Act.

BMD Seeking Recovery for Opioid Losses on behalf of Summit County and its Political Subdivisions

As the opioid epidemic continues to take its toll on our community, its resources and straining the already tight budgets, Brennan Manna & Diamond, on behalf of Summit County and its political subdivisions, filed a complaint against those companies that make or distribute prescription opioids seeking recovery of the County's losses as a result of the opioid crisis.