Do medical billing services, individual medical billers and certified coders require Professional Liability Errors and Omissions Insurance coverage to perform their job duties?
Professional Liability Errors and Omissions Insurance coverage helps to protect your business or company services from claims submitted by your clients.
Let's say you are a medical billing service and the doctor sends you $120,000 worth of Aetna medical claims. You are required to bill a clean CMS 1500 claim to Aetna within 90 days from the date of service (per doctors contract with Aetna) and you have issues getting a clean CMS 1500 medical claim sent through the electronic medical claim clearinghouse software. Your medical billing staff didn't realize they could drop the claims to a CMS 1500 form and bill it by paper so the claims sit their denied at the medical claim clearinghouse, waiting for someone to fix the issue.
95 days later you finally get the medical claim clearinghouse working and all CMS 1500 electronic claims are submitted to the carrier and denied for untimely filing. Your billing service can't appeal (although it doesn't hurt to try) because you can't prove you sent Aetna Health Insurance a clean CMS 1500 medical claim in the timely filing period.
Now let's say the doctor was expecting to collect about $73,000.00 from Aetna on the $120,000 worth of medical claims. The doctor is mad when he finds out that he just lost $73,000.00 in business and decides to sue you for this loss.
The Professional Liability Errors and Omissions Insurance Coverage can potentially protect you from most of these fees including court, attorney and lawsuit settlement fees.
Does a Medical Billing Service require Professional Liability Errors and Omissions Insurance - no but would it help out to cover the costs of protecting your business in the case of being sued by a doctor? Yes.
Who needs Professional Liability Errors and Omission Insurance in the medical industry? Anyone who performs "services" to a client. Services can be anything from billing, coding, doing work in a "timely" matter.
General Liability Insurance does not protect your business for errors, contract performance disputes, or any other professional liability issues which is why they have Error and Omission insurance.
Some states do not require providers to have Medical Malpractice Insurance although most doctors do have Medical Malpractice Insurance.
Employment Practices Liability Insurance or EPLI insurance is insurance policies to protect employers from employees, former employees or "potential" employees. If employees feel discriminated against for their age, sex, race, disabilities, sexual harassment or wrongful termination you may find the need for EPLI insurance.
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