Malpractice Insurance for PAs: What You Need to Know to Protect Your Career

Every clinician hopes to never be sued – but thats why malpractice is often required and covered in many different capacities. Malpractice insurance (aka professional liability insurance) is a critical safety net for physician associates. In this deep dive, we’ll cover why PAs need malpractice coverage, the types of policies available, how regulations differ by state, and key considerations like policy limits and carriers. We’ll also highlight resources (like AAPA guidelines and APALM) that can help you navigate liability and risk management.

Yes, You Need Your Own Coverage (Here’s Why)

First things first: All clinically practicing PAs should carry professional liability coverage during all periods of practice. Even if your employer provides some malpractice insurance, it may not fully protect you. Here are important points on why having your own policy is wise:

• Gaps in Employer Coverage: Many employers (hospitals, clinics) have group malpractice policies covering their providers. However, these policies primarily protect the employer’s interests. If you leave a job or a claim is filed after you’ve left, you could be uncovered if there’s no “tail” coverage. An individual policy ensures you’re personally protected no matter your employment status.

• Legal Defense Just for You: With your own policy, you’ll typically have your own attorney provided by the insurer to defend you in a lawsuit. Under an employer’s policy, you might share an attorney with the supervising physician or institution, which could be a conflict if finger-pointing occurs. Separate coverage means your interests are paramount.

• License Protection: Some PA malpractice policies include coverage for licensing board complaints or disciplinary defense. Employers’ insurance usually doesn’t cover that. If a patient complaint triggers a board investigation, having a policy that pays for an attorney to guide you can be invaluable.

One common concern is, “Will having my own policy make me a bigger target for lawsuits?” This topic is debated. Some legal experts argue that plaintiffs’ attorneys may be more likely to name you in a suit if they know you have a separate policy (a “deep pocket”). In an article by the Academy of Physician Associates in Legal Medicine (APALM), seasoned PA Jeffrey Nicholson notes that you could be more likely to be named in a suit if you have your own policy, since the plaintiff knows you have independent coverage.

Additionally, if you and your supervising physician share one policy, the legal team defends you together, whereas separate policies could theoretically lead to the physician’s lawyers deflecting blame onto you.

That sounds scary – but it shouldn’t automatically dissuade you from getting insured. The flip side is if you don’t have your own coverage and your employer’s policy has limits or exclusions, you could be hung out to dry. Also, if you do any work outside your main job (moonlighting, PRN shifts, volunteer work), you absolutely need your own insurance for those activities. In fact, Nicholson concedes there are instances where having your own policy is beneficial – for example, if your employer’s coverage isn’t adequate or if you moonlight as an independent contractor.

Bottom line: On balance, most experts (and PA organizations) advise carrying your own malpractice insurance to ensure you’re fully protected. The peace of mind outweighs the slightly increased liability profile, especially if you practice safely. As one risk management saying goes, it’s better to have it and not need it than need it and not have it.

Types of Malpractice Policies: Claims-Made vs. Occurrence

Not all malpractice insurance is created equal. The two main policy types are claims-made and occurrence. Understanding the difference is crucial:

• Occurrence Policy: Covers any incident that occurred during the policy period, regardless of when a claim is filed. Even if you get sued years after you treated the patient (long after the policy has expired), an occurrence policy would still cover you, as long as you were insured when the incident happened. These policies are becoming less common and are typically more expensive, because the insurer’s risk persists indefinitely (they must cover “long tail” claims)

  The benefit is you don’t need to purchase tail coverage when you leave or switch jobs – you’re covered for those past acts permanently. The downside is cost and sometimes lower available limits in older policies (e.g., an old occurrence policy from 10 years ago might have had lower limits that are now outdated for today’s lawsuit costs).

• Claims-Made Policy: Covers claims only if the policy is active both when the incident occurred and when the claim is filed (or during an extended reporting period). This means if you cancel or leave a job with claims-made coverage, you must get tail coverage (an extended policy) to cover any future claims from your prior work. Claims-made is more common and cheaper initially.

  Typically, premiums “step up” over 5 years (cheapest in year 1, increasing to mature rate by year. It’s cheaper upfront because if you quit after a short time, the insurer’s exposure ends (unless you buy tail). However, to be fully protected, you either stay with the same insurer long-term or buy tail coverage when you leave. Tail coverage can be pricey (often 1.5 to 2 times your annual premium).

In summary: An occurrence policy is the gold standard in coverage (no tail needed), but you pay more for that convenience and they can be hard to find. A claims-made policy is more prevalent and cost-effective short-term, but you MUST remember to secure tail coverage (or have your new employer/insurer provide “prior acts” coverage) when you transition.

Many PAs starting in practice might opt for claims-made due to availability. If so, plan financially for the tail. If an occurrence option is offered by, say, your PA professional association’s insurance program and it’s affordable – it could be worth it for peace of mind.

How Much Coverage Is Enough? (Policy Limits)

Malpractice policies are defined by limits of liability, often written per claim/annual aggregate. For example, a common coverage might be $1,000,000 per claim / $3,000,000 per year (meaning the insurer will pay up to $1M on a single claim and up to $3M total for all claims in that year).

How much does a PA need? It depends on specialty, location, and risk tolerance. CM&F Group, a major malpractice insurer for PAs, offers limits up to $2 million per claim, but they typically recommend $1 million per claim for PAs as a standard.

Many hospitals and employers also require providers to carry at least $1M/$3M. Higher risk fields (e.g. surgery) or litigious locales might warrant higher limits if available (e.g. $2M/$4M). The downside of super high limits is cost and potentially making you a bigger “target” (plaintiffs know the money is there). But you also don’t want too little, or a catastrophic claim could exceed your coverage (though that’s rare, as $1M is usually sufficient to cover most settlements for PA scope practice).

Pro Tip: Match your limits to what physicians in your specialty carry or what your collaborating physician has. This also ensures your coverage is accepted by employers credentialing you.

Some states have legal requirements or caps: A few states mandate minimum malpractice coverage for PAs or have patient compensation funds that require participation if you carry lower limits. Always check your state’s regs. For instance, in certain states if a provider carries at least a set limit and pays into a state fund, their liability is capped by law. These nuances are state-specific.

Costs of Malpractice Insurance for PAs

You might be wondering, how much will this cost me? The premium for PA malpractice insurance can vary widely:

• According to AAPA, policies can range from around $1,000/year for a PA in part-time family practice up to $7,000–$8,000/year for a full-time surgical PA. That’s a broad range reflecting risk exposure.

• Factors influencing cost include: your specialty (higher for surgery, ER, OB vs. primary care or psych), your hours (full-time vs part-time), the state or region (higher in litigious states like New York or Florida), and your claims history.

• New graduate PAs often see lower rates initially (especially if claims-made “step rates”), then it increases over the first 5 years to the mature rate.

• Discounts are often available: e.g. if you’re a member of AAPA or state PA society, some insurers give a discount. New grads might get a new-to-practice discount. Taking a risk management CME course can sometimes lower your premium as well.

• To get a true sense, it’s best to get a free quote from an insurer. Many offer instant online quotes. “The best way to calculate cost is getting a free quote… it takes less than five minutes” online at a provider like CM&F.

Remember, if your employer covers you, they pay the premium – but if you need tail coverage when you leave, you might be on the hook for that cost. When negotiating jobs, it’s worth asking “If I leave, will you pay my tail coverage?” Some employers will, or if they switch carriers, they might purchase “nose” (prior acts) coverage to cover you. Always clarify in your contract.

For self-employed or moonlighting PAs, shop around for a policy that fits your practice type. Rates between carriers can vary, and one might have a better deal for your niche than another.

PA vs NP Malpractice Premiums – The Gap is Closing

An interesting fact: historically, nurse practitioners paid less for malpractice insurance than PAs, on average. This wasn’t due to differences in safety but rather insurance pool dynamics. AAPA explains: NPs often started as RNs and many maintained coverage through RN insurers, which had a huge pool of insured nurses (millions) subsidizing the costs. In contrast, there are fewer PAs (about 140k practicing) contributing premiums, thus, NP premiums were artificially lower because the risk was spread across a larger base (including RNs)

However, this gap has been narrowing. In recent years, insurers like CM&F have stopped subsidizing NP rates with RN pools – causing NP premiums to rise and approach parity with PA premiums.

Also, as NPs gain more autonomy and perform similar roles to PAs, their risk profile converges. The key takeaway: PAs and NPs can both expect to pay similar amounts going forward for equivalent roles. So don’t be too envious of an NP colleague’s lower rate – it may not last!

Risk Management and Resources

Beyond buying insurance, PAs should engage in risk management to actually prevent claims. This includes good documentation habits, clear communication with patients (informed consent, follow-ups), and staying within one’s scope of competence (consulting when needed). Many malpractice insurers offer free or discounted risk management CME – take advantage of those to both improve practice and sometimes lower your premium.

For additional guidance and support, consider resources from:

• AAPA: They have articles and FAQs on malpractice (like “What PAs Need to Know About Malpractice Insurance” and can help answer general questions. AAPA also endorses certain carriers, meaning members might get group rates.

• APALM (Academy of Physician Associates in Legal Medicine): This relatively new academy under AAPA is focused on educating PAs about malpractice and legal issues. Their mission is to “provide education on malpractice liability & risk management to AAPA members”. APALM offers webinars, articles (like the series by Nicholson), and even opportunities for PAs to get involved in legal medicine (e.g. serving as expert witnesses).

• Insurance Carriers (CM&F, HPSO, etc.): Don’t hesitate to call and ask questions. For instance, CM&F Group has been a longtime PA insurance provider and can explain options like occurrence vs claims-made if you’re unsure. They often publish insights – e.g., CM&F’s blog noted malpractice insurance is non-negotiable for any practicing PA, whether in-person or telehealth.

• State Laws: Be aware of your state’s malpractice environment. Some states have caps on damages or specific rules (e.g. requirement to have coverage if you have autonomous practice). Your state PA chapter or medical board can provide guidance on any state-specific insurance mandates.

Conclusion

While malpractice insurance isn’t the most fun topic, it’s absolutely a cornerstone of a responsible medical career. Having the right coverage protects your patients, your license, and your peace of mind. As a PA, you work hard to care for others – make sure you’re caring for your own professional well-being too by staying informed and insured.

To recap key takeaways:

• Carry malpractice insurance whenever you’re practicing clinically, its illegal to not have coverage. Employer coverage is good, but an individual policy ensures you’re fully protected.

• Understand your policy type. Claims-made is common (remember to get tail!). Occurrence is hassle-free but pricier.

• Aim for at least $1M/$3M limits (typical standard) unless a different amount is strongly indicated. Insurers often recommend $1M per claim for PAs.

• Budget for cost: roughly $1k–$3k/year for primary care and higher for some specialities. It’s a small price for career-long security.

• Utilize resources: AAPA and APALM offer guidance, and insurers provide risk management education. Knowledge is power when preventing and handling malpractice issues.

By staying proactive about malpractice coverage, you can focus on what you do best, providing excellent patient care, knowing you have a safety net if the unexpected happens. In today’s litigious world, that reassurance is worth its weight in gold.