So, you were involved in a medical malpractice lawsuit that, unfortunately, ended up in a settlement against you. Most physicians have at least a passing familiarity with the basic tenets of reporting settlements: 1) If a physician has a settlement against them in a medical malpractice action over $30,000, this must be reported to the Medical Board of California (“MBC”); and 2) more significantly, a physician’s settlement of a malpractice claim, for any amount, must be reported to the National Practitioner Data Bank (“NPDB”). (Note: This essentially means the $30,000 reporting limit is meaningless in terms of reporting a settlement to the MBC, as any settlement will be reported to the MBC by the NPDB. However, a physician is still not required to report a settlement to the NPDB if he satisfies the settlement out of pocket). Alas, the law is an ever-changing concept and recent laws have added additional requirements to insurers, physicians, and the MBC of which not all physicians may be aware.

In the past even if a settlement was reported to the MBC, it was treated as confidential and not publicly released. However, current California case law mandates the MBC post several assorted facts on the internet regarding physicians including reports of settlement. The MBC is now required to publicly disclose the names of physicians (in a “low-risk” specialty determined by the MBC) with three or more reportable claims of $30,000 or more in a ten-year period.  While the MBC cannot disclose the settlement amount, it must compare the settlement amount with the experience of similar licensees and indicate if it is below average, average, or above average.  Settlements for physicians in a “high risk” category would be reported if there were more than four over $30,000 in a ten-year period. (Note: the public reporting of settlements by the MBC only involves settlements which occurred after January 1, 2003.)

Another relatively recent law requires reporting to the MBC of any medical malpractice settlement over $30,000 where an entity (such as a professional corporation) is a party, if it also involves the alleged negligence of a physician who owns, contracts with or is employed by that entity. This report is still required even if the amount of the settlement allocated to the individual physician does not meet the $30,000 reporting limit. If the physician settles for $2000 and his group settles for $30,001, a physician report of settlement will be required.

Obviously, the law, especially as it relates to health care providers, is constantly in motion.  New laws affecting the reporting of settlements to the board and to the public are made every day and it is difficult for a physician to be aware of these changes and recognize their impact on his practice. Fortunately, the physician’s attorney and insurance company representative will generally be abreast of these changes and requirements. Participate in a dialogue with them and educate yourself on the process. Remember, the decision you make may have an impact on your record!

This article appeared in the April 2006 issue of MD News.

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