What is Managed Health Care Facility Errors and Omissions?
Managed Health Care Facility Errors and Omissions (E&O) insurance helps protect organizations that provide managed health care services from claims of negligence, mistakes, or failure to perform their professional duties. This type of professional liability coverage is designed for facilities such as HMOs, PPOs, medical management companies, and third-party administrators.
It addresses risks that can arise when managing patient care, processing claims, or coordinating provider networks. Even with the best systems and staff in place, administrative errors or lapses in care coordination can lead to costly legal action. E&O insurance provides financial protection by covering legal defense costs and settlements, subject to policy terms.
Who Needs It
This coverage is important for entities involved in managing or coordinating health care services. These may include:
- Health Maintenance Organizations (HMOs)
- Preferred Provider Organizations (PPOs)
- Medical management firms
- Utilization review companies
- Health care consultants
- Third-party administrators (TPAs)
Any facility that assumes responsibility for organizing or overseeing patient care can face liability claims related to professional errors or oversight.
What It Typically Covers
Managed Health Care Facility E&O insurance may cover:
- Allegations of professional negligence
- Mistakes in claims processing or benefit determinations
- Errors in provider credentialing or network management
- Failure to properly coordinate care
- Legal defense and settlement costs
Coverage varies depending on the insurer and policy, so it’s important to review terms carefully.
Common Exclusions and Limitations
While E&O insurance is broad, most policies have exclusions. Common exclusions may include:
- Intentional wrongdoing or fraud
- Bodily injury or property damage (typically covered under general liability)
- Employment-related claims (covered under EPLI)
- Cyber liability or data breaches (may require separate coverage)
Understanding what your policy does not cover is just as important as knowing what it does.
Factors That Influence Cost
Several factors can affect the cost of E&O coverage for managed health care facilities, including:
- Size and scope of services provided
- Annual revenue and number of patients managed
- Claims history and risk management practices
- Policy limits and deductibles
- State regulations and compliance requirements
Insurers evaluate these and other variables when determining premiums and coverage terms.
Proof of Insurance & Compliance
Many states and contracting partners require proof of E&O insurance as part of licensing or credentialing. Having proper coverage not only helps you meet these requirements but also demonstrates your commitment to responsible professional practices. Always check with your state or legal advisor for specific compliance needs.
How to Get a Quote
Getting a quote for Managed Health Care Facility E&O insurance is easy. Our team can help you compare options and find coverage that fits your needs. Start your quote today.
Frequently Asked Questions
What types of errors are covered under E&O insurance for managed care facilities?
Typical coverage includes administrative mistakes, negligence in care coordination, and errors in claims or benefit processing.
Is Managed Health Care E&O insurance required by law?
Requirements vary by state and type of facility. It may be required for licensing or contracting with payers or providers.
How does this differ from general liability insurance?
General liability covers bodily injury and property damage, while E&O insurance covers professional mistakes and service-related claims.
Can E&O insurance cover independent contractors working for my facility?
Some policies may extend coverage to contractors, but terms vary. Review your policy or speak with your insurer.
Does this insurance cover HIPAA violations?
HIPAA violations may not be covered under E&O insurance. You may need separate cyber liability or regulatory coverage for that.
Still have questions? Talk to a local insurance expert.