Consulting your malpractice insurance carrier’s attorney: what you might not know…..

Most clinicians take great care to maintain an ethical and legally compliant practice. Yet, despite these efforts there are still instances where consultation with available written materials and other clinicians yields incomplete answers. Clinicians have several options for additional help when the questions concern compliance with applicable statutes, regulations, and case law. In these situations clinicians often turn to attorneys for assistance in navigating these difficult dilemmas.

When consulting an attorney, there are basically three options. Option #1, which is the most popular, involves contacting the malpractice carrier to speak to its attorney. This type of consultations is the focus of this post. The other two options, consulting a private attorney or a lawyer retained by a local professional association, will be discussed in a later post.

Consulting with the professional liability policy carrier about practice-related legal questions is, as mentioned above, the modal method for mental health clinicians to receive this type of legal advice. This is an arrangement that benefits the clinician and the carrier. Clinicians receive legal advice at a very low cost (it is often included in the premium), and carriers can use these consultations to minimize expenditures through lawsuits and settlements. This is an arrangement that makes sense from an economic perspective.

While these sorts of consultations are effective, some clinicians do not realize that the carrier attorney on the other end of the phone conversation is not their attorney. Lawyers who are retained by insurance companies work for the insurance company, and not for the clinician. Much of the time this doesn’t matter because the interests of the carrier and the insured are aligned. But this isn’t always the case.

Most of the time the answers to practice-related legal questions aren’t crystal clear, and in this way legal practice is similar to mental health practice. In both fields, the correct intervention often isn’t 100% clear, the answers are largely dependent upon many interdependent variables, and a number of different courses of action may be appropriate. In both mental health practice and the law, the best answer is often, “it depends.”

When clinicians sit down with a private attorney, the attorney is likely to present a menu of different options, along with his/her recommendation as to which is the best course of action. This is the lawyer’s responsibility to inform his/her client as to how to meet the client’s needs. But in the case where a clinician consults with an attorney hired by a third party, the advice given may be tailored to meet the needs of the third party. Professional liability carriers have a strong interest in limiting expenses, and their attorneys must fulfill their obligations to these clients.

Note that this doesn’t mean that the professional liability carrier attorneys who are available to consult with clinicians give out poor advice, or in some way “hide” the best options for fear that it might cost their clients money. In fact, they often give out great advice that is based on numerous similar calls. Nevertheless, consulting with an attorney who works for a professional liability carrier inevitably means asking (at least in part) the carrier’s legal counsel what is in the best interests of the company.

Some things to remember:

• A conversation between a clinician and the insurance company’s attorney may not be confidential and fall within the scope of the attorney-client privilege. That is, clinicians who reveal something potentially incriminating to the carrier’s attorney may find themselves in an uncomfortable position. In case of doubt, ask if the conversation is confidential and solely between clinician and attorney.

• Be aware that, in the event of legal action, many professional liability policies allow the insurance carrier to settle (or cease paying defense-related costs) without the consent of the insured. This is one situation where the goal of the carrier may be in conflict with that of the policy holder; the carrier wants to mitigate expenses, but the clinician wants very much to clear her/his name.

• Consider consulting with a private attorney that is experienced in matters of professional liability, mental health law, and administrative actions for a second opinion.

IMPORTANT: This website is for basic information only. Nothing in this website should be construed to be formal legal advice, nor does it create an attorney-client relationship. Please see the “Important Information” page at the top of the screen.