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Healthcare Reform, Mid-Level Providers, and Liability Risk

By James W. Saxton, Esq. and Maggie M. Finkelstein, Esq.

Risk management strategies have been a key factor to the success of a physician practice for over a decade now; however, the focus has traditionally been on the benefit to reducing liability risk.   Now, risk management takes on a new importance as healthcare practice is increasingly tied to quality, transparency, and safety.   New factors at play in the healthcare environment, particularly national healthcare reform, will make the need for incorporating risk management strategies even greater.  A few significant issues include:

  • Physician shortages
  • Physician payment linked to quality, including comparative effectiveness
  • Changes in physician reimbursement, including bundled payments
  • Changes in the way healthcare is delivered including the use of mid-level providers and new ACO’s

Healthcare reform is going to continue to have an impact on physician liability, creating greater exposure for some physicians.  Consider that the implementation of national health insurance coverage will reportedly result in about 32 million new insureds, or patients.  How will the nation’s physicians care for 32 million new patients?  According to a June article in the Los Angeles Times, the Association of American Medical Colleges has forecasted a shortage of physicians by 2025, up to 125,000 doctors.  The American Academy of Family Physicians estimates that 149,000 extra doctors will be needed by the year 2020.  Most physician practices are already at capacity.  Some have posited that physicians will need to increasingly rely on mid-level provider support to care for the new insureds.

In recent years, physicians have increasingly been relying on mid-level support to manage increased patient flow and needs.  When proper mechanisms are in place, mid-levels can help to improve patient satisfaction, efficacies, and quality of care.  However, when appropriate supervising and collaborative measures are not in place, or are not followed, patient care can be negatively impacted and physician liability exposure can increase.  Rarely are lawsuits filed solely against a mid-level; but rather, lawsuits involving care by a mid-level focus on the supervising physician as well.  Allegations against the supervising physician have included:

  • Failure to adequately supervise the mid-level
  • Failure to have in place a collaborative agreement
  • Failure to follow the requirements of the collaborative agreement
  • Allowing the mid-level to practice beyond the scope of his or her collaborative agreement
  • Negligent hiring of the mid-level

Often, those allegations are based on the mid-level’s

  • Failure to diagnose or delay in diagnosis
  • Failure to make a referral or delay in making a referral
  • Failure to communicate with the supervising physician
  • Practicing outside the scope of authority

You can see how plaintiff attorneys can associate the mid-level’s actions or inactions with liability exposure to the supervising physician for certain perceived inaction on his part.  Did you have in place a collaborative agreement, signed by you and the mid-level, which set forth the scope of practice of the mid-level?  Did you hold regular meetings with the mid-level?  Did you conduct random reviews of the mid-level charting?

You can however reduce your risk.  Here are some recommendations:

1.  Hiring. In the first place, hire mid-levels with certain established competency and training.  Verify the credentials with the original sources, including the state licensing department.  Analyze the candidate’s propensity to five-star service and enhancing your practice’s culture.

2. Written collaborative agreement. Have in place at the outset a written collaborative agreement, that meets the requirements of Pennsylvania law.  The agreement should set forth the midlevel providers responsibilities – what she can and cannot do  – and limitations.  Review the agreement on a yearly basis.

3.  Create policies and procedures. Create relevant policies and procedures regarding your expectations of the mid-level to the extent not covered in the collaborative agreement.  For example, what process is going to be involved with your supervision? How often will you meet with the mid-level? How should the mid-level contact you?

4. Conduct performance evaluations. Conduct periodic performance reviews (perhaps 3 x / year to start then yearly) with defined goals and expectations that include competency, continuing education, continued training, patient satisfaction, and five-star service.

5. Perform Random Chart Audits. Perform random chart audits to verify mid-level compliance with the collaborative agreement and other policies and procedures, including practicing within the scope of authority and proper documentation.  Frequency of reviews should be greater during the early period of a new hire, and decrease in frequency as time goes on; but in every case, chart audits should be done at the very least at the time of every annual performance review, if not more often.

6. Have in place appropriate employee policies and procedures, and follow them. Beyond the policies and procedures related to who you will work together; assure you have in place the appropriate employment policies and procedures that will allow you to terminate a relationship appropriately with a midlevel if she or he is not a fit with your practice.

6. Mentor. Mentor your midlevel providers.  So often physicians are relieved to have an additional resource for patient care that the mid-level provider is left on his or her own.  Your best investment with mid-levels is to spend the time now mentoring them on patient care, five-star service, documentation, and communication.  This is a long-term pay-off.

As this article started out, risk management strategies in today’s new environment, and the environment to come, take on greater importance.  Look ahead to impact your risk now.  With the anticipation of increased reliance on mid-levels for patient care, assure your infrastructure incorporates the above-measures.

James W. Saxton, Esq. is Co-Chair of Stevens & Lee’s Health Law Department and Chair of the Health Law Litigation Group, whose practice consists of representing and protecting physicians, medical practices, Centers, and health care organizations in areas of risk management, staff issues, and health and hospital law litigation.  Mr. Saxton can be reached at jws@stevenslee.com.

Maggie M. Finkelstein, Esq. is a shareholder in Stevens & Lee’s Health Law and Litigation Departments, concentrating her practice in representing health care organizations and professionals in developing and implementing risk management and loss control strategies as well as in litigation matters. She can be reached at mmf@stevenslee.com.

One comment

  1. Independent Okie NP

    Another way to reduce physician liability is to have more clinics like mine. In Oklahoma, physicians are required to be available for consultations for Rx writing only if there is a need. Otherwise, I’m on my own concerning all other aspects of NP practice. I own my own family practice and minor ER clinic. Physician liability is zero. That could be “Number 7” on Reduce Your Risk. I have been practicing on my own for years and, knock on wood, no legal issues yet. Mid-level doesn’t apply to me and others like me at all – except for the fact that I am right in the middle of it all managing any and everything that comes my way.

    Independent Okie NP

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