Practice Management Alert

Question: I've heard a lot of talk recently about biller and coder liability insurance. What exactly is this and do I need it?

Maine Subscriber

Answer: Biller and coder liability insurance will pay for legal costs and potential liability (as outlined in the individual policy) if you're ever involved in a false-claims or other fraudulent-billing lawsuit. Because billers and coders can be held responsible for fraudulent billing -- regardless of whether they are knowingly involved in the fraud -- liability insurance is certainly a good idea. You should, however, consider several factors first.

If you are a biller in a physician's office, chances are you may be covered under the practice's liability insurance. Ask your employer if you are covered under his policy. If you are not covered, the out-of-pocket expense for personal biller/coder liability insurance may be prohibitive. 

If you are an independent coding or billing consultant, you absolutely should have liability insurance. In fact, many physicians' offices may not even hire you without liability coverage. If you do not have personal coverage, be sure any potential employer's policy covers you -- and make sure it's in your contract.

What's actually covered: Personal biller and coder liability insurance is not a quick fix for all fraudulent billing activity. Most policies will protect you only in the event of a minor claims error caused by negligence that leads to someone else losing money. The insurance may not necessarily cover more serious fraud charges that involve intentional or serious wrongdoing. Also, be sure a policy covers your potential liability in a case, and not just your legal costs.

Not a cure-all: You should not view liability insurance as a cure-all for a work situation in which fraudulent billing occurs. Although liability insurance may protect you financially from some legal entanglements, it won't fix bad billing in your office. 

-- Answer provided by Wayne J. Miller, attorney with Compliance Law Group in Los Angeles; and Gary E. Matthews, president of Physicians HealthCare Advisors LLC in Atlanta.