Liability and Coverage for Patient Falls

Lawsuits and claims arising from patient falls present an evolving issue for plaintiffs, defendants, the court system, and insurance companies. If a patient sues an ophthalmologist or their medical practice or ambulatory surgery center (ASC), what legal theory applies? Is the claim one of medical malpractice (i.e., professional negligence) or ordinary negligence (e.g., premises liability)? This may appear to be a question of semantics, but the answer has important consequences.

Ordinary negligence occurs when a business or individual doesn’t take the same amount of care any reasonable person would to avoid harming others. If others incur physical or financial harm because of the breach of this “duty of care,” the business or individual can be held financially responsible. Professionals, hired for their specialized skills, are held to a higher duty or standard of care. They must use the same amount of care that others with their specialized knowledge and training would to avoid harming others; if they breach this duty it is called professional negligence. This applies not only to doctors but to other professionals like lawyers, accountants, and architects.

Medical malpractice is a type of professional liability for negligence that involves a breach of the standard of care in the performance of healthcare services. Premises liability is a type of general liability for ordinary negligence that occurs when an owner or possessor of property does not adequately protect people on the property, sometimes called “invitees,” from hazards on the premises.

Courts across the United States have come up with different ways to determine if a claim is one of medical professional liability (MPL) or general liability (GL), though these “tests” aren’t static and continue to develop. Some courts look at whether the defendant’s conduct required the exercise of professional expertise, skill, or judgment. In Florida, for example, “professional services,” from which professional liability stems, are considered to be business activities that involve specialized knowledge, labor, or skill and are predominantly mental or intellectual as opposed to physical or manual in nature. If the defendant’s conduct didn’t involve professional services, the claim would be considered one of general versus professional liability. Other courts reject this line of reasoning stating that healthcare providers perform both highly skilled and mundane tasks when rendering services, and that a breach when performing any such tasks would be considered professional liability. Some courts consider whether an expert witness would be necessary to explain the medicine or science to a judge or jury. If such an expert were necessary, the claim would fall under professional liability. Other courts look at the nature of the relationship between the premises or equipment at issue and the provision of care. If the equipment is necessary or integral to the medical treatment or diagnosis, they consider it an MPL claim. If the equipment is simply convenient for or incidental to the provision of medical care, they consider it a GL claim. Some courts focus on the responsibility of healthcare providers to offer a safe environment for diagnosis and treatment. If there are unsafe conditions that cause injury to a patient, even if these conditions could cause injury to any invitee, these courts would consider this professional negligence.

The ultimate outcome is often specific to the facts of a case. One consideration is where the patient was when the injury occurred, or, in the case of an ASC, if the patient had already been admitted. Falls in waiting rooms and public areas, like hallways and lobbies, and those of non-admitted patients, are more likely to be considered GL claims. Another consideration is whether something on the premises broke or malfunctioned versus whether the provider or employee failed to secure the patient; if the latter, MPL is more likely.

Why does it matter if a lawsuit is filed under a professional or ordinary negligence theory of liability? Most if not all states have different laws and procedures for malpractice and premises claims. For instance, an MPL suit may first need to be vetted by a medical review panel before it moves forward. Another difference is that the statute of limitations (the deadline for filing a suit) is generally shorter for MPL claims. In addition, many states cap the amount of damages that can be recovered in medical malpractice suits. The type of suit may also determine what discovery occurs and if expert witness testimony is required. It also impacts whether any settlement or judgment will need to be reported to the National Practitioner Data Bank; most MPL payments must be reported. Crucial for insurance purposes, the theory of liability will help determine what insurance is available to cover the claim and by which insurer(s). MPL policies generally do not cover injury due to unsafe premises or, more generally, injury that does not directly result from an act or omission in the provision of healthcare services, such as a failure to diagnose or an error made in surgical treatment. GL policies, on the other hand, often specifically exclude injury sustained during the delivery of healthcare, often under a “professional services” exclusion. As you know by now, state law varies, and different states evaluate insurance coverage in different ways.

Some states use the “four corners doctrine.” This means that courts compare the language of the insurance contract and the allegations in the lawsuit to determine if there is a duty of the insurer to cover the claim. In other states, courts look beyond the allegations in the lawsuit and also consider facts known or apparent to the insurer at the outset of the case. They argue that a liability insurer should not be relieved of its duty to defend a claim merely because the plaintiff in the underlying lawsuit didn’t plead his or her claim well. This means that, while the allegations in the complaint alone often indicate if an insurance policy should cover a claim, in some states there may be additional information to consider. When a suit has not yet been filed, insurers must look at the allegations in any written demand and the facts of the situation to determine whether an insurance policy applies.

Some carriers, like OMIC, include limited office premises liability insurance in their professional liability policies. In OMIC’s case, we offer $50,000 in premises liability coverage. However, if the insured has GL coverage for a premises liability claim, OMIC’s limited coverage is not available. OMIC’s $50,000 is a safeguard in the unlikely event that premises liability coverage is not available elsewhere; but when it is, the carrier specializing in that line of business is in the best position to defend and pay the claim. In fall-related claims, since it is not always clear (especially before a lawsuit is filed) whether the legal basis for the claim is professional or ordinary negligence, OMIC often must coordinate with our insureds’ GL carriers. OMIC recommends reporting these claims under all potentially applicable policies.

Notice: Office premises liability coverage is not available to OMIC insureds participating in the Kansas Health Care Stabilization Fund and the Nebraska Excess Liability Fund.

This article is an update to the article of the same title published in the OMIC Digest, Volume 25, No. 2, 2015.