Without question, the coronavirus pandemic has put a tremendous strain on healthcare facilities and their medical workers in major cities across the country, with nurses and doctors clocking 24-hour shifts and an inundation of patients stretching hospitals far beyond their capacity in some areas.
The tremendous mental toll on many healthcare workers as they work on treating and saving the lives of infected patients while trying not to become infected with the virus themselves is a significant part of the fallout from COVID-19. Our first responders and front-line workers are being lauded throughout the country for their heroic efforts, and we at RPS join in recognizing their selfless acts.
How COVID-19 will impact the healthcare facilities insurance market remains to be seen. James McNitt, RPS Healthcare Area President, weighs in on some of the issues that may arise, stressing that much is still unknown with a fluid situation that evolves from one day to the next.
“We are seeing underwriters more cautious in writing Professional Liability insurance due to the risks involved in the face of COVID-19. You have certain healthcare facilities such as nursing homes that are experiencing a significant number of coronavirus-related deaths,” said McNitt.
The number of COVID-related deaths in nursing homes indeed may be underreported, as there are 29 states that don’t require facilities to report fatalities. About 1.3 million people live in the nation’s 15,600 nursing homes, according to the CDC.
Another area that may very well impact the insurance industry is the legislation and/or executive orders that several states have passed or mandated, granting liability immunity to healthcare facilities, including nursing homes, as it relates to COVID-19.
For example, in April, Illinois’ governor issued an executive order granting healthcare facilities, healthcare professionals, and healthcare volunteers immunity from civil liability for any injury or death that occurs at a time when the facility or provider was providing healthcare services in response to COVID-19. The immunity does not extend to injuries caused by gross negligence or willful misconduct.
New Jersey’s governor also issued a broad executive order providing that, among other things, any licensed healthcare provider will be immune from civil liability for damages alleged to have been sustained as a result of their acts or omissions “undertaken in good faith” in connection with the state’s COVID-19 response.1
New York and Massachusetts have passed laws explicitly immunizing nursing home facilities from COVID-19 related liability. In addition, healthcare trade groups in California have asked the governor to issue an executive order that would make facilities, plans, doctors and healthcare employees “immune from any administrative sanction or criminal or civil liability or claim for any injury, death, or loss” that is alleged to have come from the care they provide during the state of emergency.2
At the same the federal government is looking at granting businesses COVID-19-related liability immunity, which would include healthcare facilities. This is currently an ongoing discussion among legislators.
“While the issue of liability immunity is debated and hammered out, the conflict between state and federal laws could potentially cause legal complications and insurance issues,” explains McNitt, “similar to the situation we have with state and federal cannabis laws where you have medical [and recreational] marijuana legal in many states but illegal on the federal level.
“In addition, the California Insurance Department has ordered insurers to refund premiums to businesses experiencing hardships. This applies to a number of policies including Medical Malpractice insurance. What will happen if there is a lawsuit against a facility and the premium has been refunded? These and other issues have to be addressed.”
RPS continues to keep abreast of how the coronavirus crisis may impact healthcare facilities and the insurance industry in general, and are committed to providing our retail partners with the latest insights.
1Winston & Strawn, LLP
2 Mercury News