Common Moonlighting Scenarios – What’s Covered By Your Malpractice Insurance?

By Jensen Peck, Business and Professional Insurance Executive

As the insurance agency for the Wisconsin Medical Society, we receive calls often from members and client physicians who are considering supplemental employment (side gigs) outside of their regular scope of practice. They’re often told to “not to worry about” the liability because it’s either covered by the employer or “minimal exposure.” Fortunately, most physicians recognize this may not be true and it’s best to receive input from an insurance agency that specializes in health care liability. Let’s review a few of the more common scenarios and important questions that need to be answered to confirm potential malpractice exposures are covered.

Physicians serving in medical director or other supervisory roles in medispas, EMS services, nursing homes, and other new health care ventures have become common in recent years. While these positions can offer professional growth and financial reward, they also can present new and unprecedented risks. As a medical director, you are responsible for the overall medical practices within the facility, even if you are not directly performing the procedures. While the staff—typically non-physicians such as estheticians, nurses, and nurse practitioners—administers treatments, the medical director is accountable for ensuring that all procedures are performed according to the highest medical standards. If a patient suffers harm from a procedure such as a Botox injection requiring revision or an adverse reaction to treatment or medication, the medical director can be named in a lawsuit, regardless of whether they administered the procedure or were even on site at the time.

Another scenario is physicians who volunteer for Federally Qualified Healthcare Centers (FQHC) and free clinics. FQHCs are typically nonprofit organizations that provide primary care services to underserved populations, often funded by federal grants. Physicians who practice part-time at an FQHC are often covered for malpractice insurance through the Federal Tort Claims Act (FTCA). If a malpractice claim is filed, the FQHC will typically provide legal defense under the FTCA, meaning the FQHC will arrange and pay for legal representation in case of a lawsuit. If a claim results in a settlement or judgment, the FTCA ensures that the U.S. government will cover the financial responsibility up to the applicable limits. A free clinic is a community-based health care facility that provides medical services at either low or no cost to individuals who are uninsured, underinsured, or otherwise unable to pay for care. Physicians who volunteer at free clinics are not given coverage from the FTCA. Regardless of compensation, physicians are required to get traditional malpractice insurance to cover their work done at these clinics – whether it’s part-time or full-time. So, it’s very important to be aware if the clinic is a FQHC or not. A free clinic isn’t always an FQHC.  

There are many other questions you should ask yourself, your employer, and your malpractice insurance experts at WisMed Assure that are unique to your scenario. It’s important to have a clear understanding of your role and a written description of your responsibilities. These duties will likely fall in the category of either administrative or direct patient care. You must confirm if your or your employer’s insurance policies will cover all of your responsibilities. We urge you to reach out to us! Contact the WisMed Assure team at insurance@wismedassure.org or call 608.442.3810. We are here to serve the health care professionals who serve our communities. We will explore the application of Good Samaritan laws in a future issue of the Antidote.

Please note: Wisconsin Medical Society members have access to our legal assistance hotline for additional discussion about these topics.