THE KENTUCKIANA
MEDICAL RECIPROCAL
RISK RETENTION GROUP
PROFESSIONAL
LIABILITY INSURANCE
PROGRAM BROCHURE
PHYSICIAN AND OTHER HEALTH
PROFESSIONALS
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KENTUCKIANA MEDICAL RECIPROCAL RISK RETENTION GROUP
PROFESSIONAL LIABILITY INSURANCE PROGRAM
The University of Louisville School of Medicine, its physicians, and University of Louisville
Hospital jointly established a captive risk retention group, Kentuckiana Medical Reciprocal Risk
Retention Group (“KMRRRG”) in 2003 to provide professional liability coverage to eligible
medical school faculty physicians and the UofL Hospital (the “Program”.) The University of
Louisville Medical and Dental Residents and Students joined the program in July 2005.
Throughout this brochure, the term “physician” may include podiatrists and certain allied health
professionals insured through the Program. A separate Resident and Student brochure exists that
defines that group’s particular coverage. The Program is designed to assist physicians in
protecting themselves against professional liability exposures. Certain UofL departments and
their faculty practice groups also receive professional liability coverage under the Program.
Coverage is available on a “modified claims made” basis. Please refer to Section B for further
explanation of this type of coverage.
Since the Program may receive personal health information as defined within HIPAA, Section C
of this brochure has the Program’s Policy Statement. The Program is committed to meeting all
of the conditions set forth by the HIPAA Privacy Rule.
The following summary addresses some of the issues affecting physician participation in the
Program. This summary does not encompass all of the terms, conditions, or provisions of the
Program.
SECTION A – COMMON FEATURES
1. What kind of insurance coverage does the Program offer?
For physicians, residents, and students, the program offers primary professional liability
coverage on a modified claims made basis.
2. How is the Program structured?
KMRRRG (the “Company”) provides physician, resident, and student professional liability
coverage, as well as UofL Hospital professional liability coverage. The Company is a
reciprocal risk retention group under the captive law and is domiciled in the Commonwealth
of Kentucky. The Company is also registered in the state of Indiana.
The Company has four (4) Class A Subscribers: University of Louisville Medical School
Practice Association, UofL Health Care, University Medical Center, and the University of
Louisville. Class B Subscribers include over 26 faculty practice groups, University
Physicians Associates, the University of Louisville, and UofL Hospital.
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3. Who is eligible for coverage under the Program?
Physicians, residents and students who satisfy the eligibility criteria listed below are eligible
to participate in the Program.
A. Shall be a faculty member (full or part-time), resident, fellow, or student of the
University of Louisville School of Medicine or School of Dentistry;
B. Shall agree to actively support and participate in the Risk Management Programs of the
Company;
C. Shall agree to joint defense of claims;
D. Shall be an employee of an insured faculty practice group or clinical department
practice (e.g., office staff, medical assistants, radiology techs, etc.)
4. Will you review my claims history?
Yes. New applicants are required to submit copies of their claims histories from all prior
insurance carriers for the past five years. Your claims history must be acceptable to the
Program to be considered for coverage. The Company will require updated claims histories
from prior carriers until the time the Company has five years of claims history on the
applicant.
5. Is part-time coverage available?
Yes. Part-time coverage is available for physicians who meet the eligibility criteria. It is the
policy of the Company to extend part-time faculty the opportunity to apply for professional
liability coverage for services rendered as part of an individual’s faculty appointment. The
Company does not provide coverage for any aspect of professional work for a part-time
faculty member which occurs outside the individual’s faculty appointment.
Coverage for gratis faculty may be granted if eligibility criteria are otherwise met upon
request of the Department Chairperson and subsequent review and approval by the
Eligibility and Underwriting Committee.
All physicians will be required to submit his/her FTE status and notify the Company of any
changes to this status at anytime during the policy period.
6. What are the physician eligibility criteria for renewal?
Professional liability insurance coverage will be renewed based upon evaluation criteria
established by the Program’s Underwriting and Eligibility Committee. The following will
be taken into account:
A. Continued compliance with initial eligibility criteria.
B. Trends that are evidenced by claims history.
C. An analysis of the facts surrounding any claims asserted against the physician in
determining the desirability of continuing coverage for the physician.
D. The physician’s active cooperation in the defense of claims.
E. Any change in licensure or privilege status within any health care facility.
F. Any other information that would bear upon the physician’s skill and ethics of practice.
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7. What “per claim” and individual aggregate limits are available to participating
physicians?
A. Physicians receive primary professional liability coverage with coverage limits in
Kentucky of $1,000,000 per claim/$3,000,000 annual aggregate.
B. For physicians practicing in the State of Indiana, professional liability coverage limits are
$250,000 per claim/$750,000 annual aggregate. In addition, the Company participates in
the Indiana Patient Compensation Fund. Each insured must notify the Company if he/she
is going to practice in the state of Indiana.
8. Will the Program cover a physician while practicing outside of the University of
Louisville School of Medicine Professional Practice Plan?
No. Coverage under the Program was designed to provide coverage while the physician is
rendering services pursuant to their faculty appointment/assignment. This includes clinical
services for faculty practice groups and teaching clinics. Please consult your Department
Chair for further clarification of these services.
9. Will professional corporations, limited liability companies and partnerships be eligible
for coverage under the Program?
Yes. The Program will provide coverage for a professional corporation, limited liability
company, or partnerships but only for the acts or omissions of a physician who has obtained
coverage through the Program. This coverage is further limited to acts or omissions that
occur on or after the inception date of coverage under this Program for the physician(s).
Only one limit applies per claim, per physician insured, no matter how many insureds under
the professional service corporation policy is named in a claim.
10. Are office employees of physicians, professional corporations, limited liability
companies and partnerships also eligible for coverage under the Program?
If desired, allied health professionals and staff employed by a professional corporation,
limited liability company, or partnership or working for or on behalf of the professional
service corporation, limited liability company, or partnership are eligible for coverage
through the Program with shared limits of $1,000,000 per claim/$3,000,000 annual
aggregate. The Program will issue a separate policy and additional premiums may apply.
11. Are separate limits available for Professional Corporation coverage?
Yes. Policy limits are $1,000,000 per claim/$3,000,000 annual aggregate. The Professional
Service Corporation (“PSC”) policy will have shared limits with all additional insureds
outlined in a Schedule provided by the department or professional service corporation.
12. Will participants in the Program receive individual policies?
No. Each participating physician will receive an Advice Certificate of Insurance and will be
named as an “additional insured” on a group policy of their respective professional service
corporation or department. Each PSC policyholder receives a policy and copies may be
obtained by the department or PSC administrator.
13. When does the Company consider a claim to be made?
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The Company considers a claim to have been made at the earlier of the following times:
A. When the insured physician first gives written notice to the Company that a claim has
been made, or
B. When the insured physician first gives written notice to the Company of specific
circumstances involving a particular medical incident that may result in a claim.
14. What are the Insured’s responsibilities to provide notice of a claim?
An Insured has the duty to provide prompt written notice of a claim. The notice should
provide particulars sufficient to identify the insured and all reasonably obtainable
information with respect to time, place, and circumstances of the claim. The Insured also
has the duty to immediately forward to the Company every demand, notice of intent,
summons, or other process received by the Insured or the Insured’s representative and to
actively cooperate with the Program in the defense of the claim. Notice can be given by
forwarding such materials to the Company’s Executive Director at: 201 E. Jefferson St.,
Suite 104, Louisville, KY, 40202, or fax at 569-2061. Insureds may call the Company at
569-2060.
NOTE: Please be aware that failure to promptly notify the Company of a claim or
actively cooperate in the defense of a claim is a violation of the terms and conditions of
the insurance policy that could result in denial of coverage.
15. How is defense provided for physician claims?
The Claims and Risk Management Committee reviews and approves defense counsel for the
Program for defense against all claims. Joint defense will be provided by counsel selected
by the Program if one or more participating physicians, residents, students, hospital, or
Professional Corporations are involved as co-defendants in a professional liability suit. In
the event a physician or Professional Corporation desires to select independent co-counsel,
the expense of that co-counsel will be borne by the physician or Professional Corporation.
16. Is a physician’s consent required prior to the settlement of any claim made against
him/her?
No. Physician premiums through this Program are favorable for several reasons. One of
these reasons is the right of the Program to control settlement of all claims. The Program
will seek physician input as part of each claim evaluation. Final settlement authority,
however, resides with the Program.
17. Is the Company subject to the Kentucky Property and Casualty Guaranty Fund?
No. The Kentucky Property and Casualty Guaranty Fund provides for a fund to meet
covered claims under policies issued by insureds that become insolvent. The State of
Kentucky requires all admitted insurers to be members of the Fund. An admitted insurer is
an insurance company licensed by the State to do business in Kentucky. The Guaranty Fund
is funded by an annual assessment of its members. Kentucky law governing the Fund
exempts all non-admitted insurers from participation and, therefore, the Company does not
participate.
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Although it does not participate in the Guaranty Fund, the Company has instituted internal
procedures to assure that it will have sufficient funds available to pay covered claims.
Funding of the Program is actuarially determined annually, in consideration of expected
losses.
18. What are the premiums and payment terms?
Annual premiums for coverage are paid in four installments without interest, or an insured
may pay 100% of the annual premium at the beginning of the policy year. Quarterly
premium invoices are sent to policyholders, free from finance charges. Payment is expected
within 30 days of the invoice date. Failure to make payment within 30-days of the due date
is subject to a 10% late penalty.
For those participating in the Indiana Patient Compensation Fund, the Fund’s surcharge is
assessed at the beginning of the year, or when the physician participates in the Fund, and is
charged to the insured at the next installment. The Fund’s surcharge is not prorated and is
due within 30 days of the physician’s effective date. Part-time Indiana Patient
Compensation Fund participants, however, receive surcharge discounts based on the number
of hours worked in the State of Indiana.
19. If a physician or his or her medical partnership or professional service corporation
agrees to indemnify someone else for liability arising from the professional services
provided by that physician or other physicians in the Physician Group, how would that
affect coverage through the Program?
The policies cover only the acts or omissions of the Insured physician, subject to the terms,
conditions and exclusions set forth in the applicable policy. All policies of physician
professional liability insurance issued by the Company exclude coverage for any liability of
any other person or entity which the Insured assumes under a written or oral agreement. The
assumption of liability would not eliminate coverage for the physician’s own acts or
omissions otherwise covered under the policy. However, the person or entity indemnified
would not have coverage and the physician (or other insureds, including his/her Physician
Group) would not have any coverage for liability of the third party which was assumed
under the agreement but which is a liability the physician or insured did not otherwise have.
20. If a physician has a Claims Made policy from another insurance company and joins
the KMRRRG Program, must the physician purchase “tail coverage” from his/her
current carrier or can he/she purchase similar coverage through the KMRRRG
Program?
The Program does not offer “nose coverage” which are incidents that occurred, but were not
reported, during the continuous period of the physician’s claims made coverage from his/her
prior insurer. Therefore, the physician must purchase the “tail coverage” or prior acts
coverage, from his/her prior carrier or other commercial carrier.
21. Does the Program have Risk Management Education courses?
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Yes. The Program offers courses that have been approved by the Claims and Risk
Management Committee and the Subscribers Advisory Council (“Board of Directors”).
Physicians completing the offered courses can obtain premium discounts subject to the
Company’s determination. The Risk Management Courses are web-based and required
courses are determined each year by the Committee and Council. See your department
administrator to obtain the web site address, log in information, and requirement courses.
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SECTION B – MODIFIED CLAIMS MADE COVERAGE
What is Modified Claims Made Coverage?
Coverage under the Program is available on a “modified claims made” basis. Under the
modified claims made form, the Program will provide coverage for claims or adverse incidents
actually reported and first made during the current policy year resulting from services rendered
after inception of coverage under this Program. The KMRRRG Program’s modified claims
made coverage provides “tail coverage” without any additional charge when a physician leaves
the program for any reason. A physician will be provided coverage under future policies as
respects to any medical incident that occurred while he/she was insured under the Program.
Physicians will have “tail coverage” at the limits of liability in effect at the time of covered
medical incident regardless when the claim is made. This will be the case regardless of
subsequent changes in the limits of liability or termination of ongoing coverage. Any shortfalls
in funding for the “tail coverage” under a modified claims made policy are the responsibility of
the Program.
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SECTION C – KMRRRG POLICY STATEMENT AND AGREEMENT
REGARDING THE PRIVACY RULE
Kentuckiana Medical Reciprocal Risk Retention Group (KMRRRG) acknowledges that it is a
business associate of applicants for insurance and insureds (collectively referred to herein as the
“Insureds”) within the meaning of the Standards for Privacy of Individually Identifiable Health
Information issued under the Health Insurance Portability and Accountability Act of 1996 (the
“Privacy Rule”). KMRRRG agrees that it shall:
1. Not use or further disclose protected health information, as defined by the Privacy Rule
(“PHI”), other than: (a) to determine the Insured’s eligibility for coverage under the
Insurance Program; (b) to evaluate claims and incidents reported under current or prior
insurance policies for purposes of settlement or defense; (c) to evaluate the Insured’s risk
management, loss prevention, and quality assurance activities; (d) to provide data
aggregation services related to the health care operations of the Insured; and (e) as otherwise
permitted or required by the Privacy Rule or other applicable law.
2. Use appropriate safeguards to prevent use or disclosure of PHI other than as provided for by
this Policy Statement.
3. Report to the Insured who provided such PHI any use or disclosure of PHI not provided for
by this Policy Statement of which KMRRRG becomes aware.
4. Ensure that any of its agents or subcontractors to which KMRRRG provides PHI received
from or created or received on behalf of the Insured agrees to the same restrictions and
conditions that apply through this Policy Statement to KMRRRG with respect to PHI.
5. To the extent KMRRRG maintains PHI in a designated record set (as defined by the Privacy
Rule) and at the request of the Insured, make such PHI available for access to the Insured,
except for PHI maintained by KMRRRG which is a copy of PHI held by the Insured.
6. To the extent KMRRRG maintains PHI in a designed record set (as defined by the Privacy
Rule) and at the request of the Insured, make available to the Insured such PHI for
amendment and incorporate any amendments to PHI provided by the Insured to KMRRRG.
7. At the request of the Insured, provide documentation of disclosures of PHI made by
KMRRRG other than for purposes described in Paragraph 1 above and provide the
following information related to each such disclosure for purposes of enabling the Insured to
provide an accounting of disclosures of PHI as required under the Privacy Rule: (a) the date
of the disclosure; (b) the name of the entity or person who received PHI and, if known, the
address of such entity of person; (c) a brief description of PHI disclosed; and (d) a brief
statement of the purpose of the disclosure that reasonably informs the Insured of the basis
for the disclosure. The foregoing obligation of KMRRRG shall not apply to any disclosures
that are excepted from the accounting requirements in the Privacy Rule.
8. Make its internal practices, books, and records relating to the use and disclosure of PHI
received from or by KMRRRG on behalf of the Insured available to the Secretary of the
United States Department of Health and Human Services for purposes of determining the
Insured’s compliance with the Privacy Rule.
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By execution of the insurance application to which this Policy Statement is attached, the Insured
agrees that he or she shall:
1. Not request KMRRRG to use or disclose PHI in any manner prohibited to the Insured under
the Privacy Rule.
2. Notify KMRRRG of any limitations in or changes to his or her Notice of Privacy Practices
to the extent that such limitation or change may affect KMRRRG’s use or disclosure of PHI.
3. Notify KMRRRG of any restriction on the use or disclosure of PHI that he or she has agreed
to in accordance with the Privacy Rule to the extent that such restriction may affect the
Company’s use or disclosure of PHI.
Upon KMRRRG’s receipt of the Insured’s written notice of a material breach by KMRRRG of
the provisions of this Policy Statement involving the use or disclosure of PHI, KMRRRG shall
take steps to cure such circumstances within the 60-day period following the notice. If the
breach is not cured within such 60-day period, an applicant for insurance may terminate the
application process or an insured under a policy of insurance may terminate the insurance policy,
if feasible.
By execution of the application to which this Policy Statement is attached, the Insured also
agrees that PHI will be needed by KMRRRG following the termination of the application
process or termination or cancellation of insurance coverage for purposes described herein and
that it is not feasible for KMRRRG to return or destroy all PHI received from or on behalf of the
Insured. Therefore, KMRRRG shall extend the protections of this Policy Statement to such PHI
and limit further uses and disclosures of such PHI to those purposes that make the return or
destruction infeasible for so long as KMRRRG maintains such PHI. These provisions shall
survive termination of the application process or the termination or cancellation of insurance
coverage.
This Policy Statement applies to a particular Insured only if and to the extent such Insured is a
covered entity or a member of the workforce of a covered entity within the meaning of the
Privacy Rule. This Policy Statement is being provided for the purpose of enabling the Insured to
comply with its obligations as a “covered entity” under the Privacy Rule.
KENTUCKIANA MEDICAL RECIPROCAL RISK RETENTION GROUP
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