What most insured parties may not realize is that these clauses effectively require their insurance companies to assume the larger and unknown risks of other health care providers, including hospitals and HMOs. • Report a Claim Suppose you are a property owner who rents out a warehouse and one of the workers at the warehouse is injured on the property or a worker breaks a piece of equipment. Hold harmless clauses and similar indemnification provisions have been recognized as efforts to duplicate and supplement the protection traditionally afforded by insurance policies. WAIVER OF LIABILITY AND HOLD HARMLESS AGREEMENT_____ Please read this document carefully. Because this article merely summarizes the law in this area and does not purport to offer legal advice, ophthalmologists should seek an attorney’s assistance in reviewing contracts and in preparing, if necessary, a proposed standard clause or other language to help reduce the risk of exposure. If possible, limit the application of the clause only to the physician’s own negligence. Medical Center) vol. Since it is often difficult to calculate the inherent risk in such clauses, insurers generally will not insure a physician’s hold harmless liability. Hold harmless clauses may form the backbone of state and national health care reform since health insurers can effectively use them to pass off financial and liability risks to physicians. Indemnify, defend with counsel reasonably acceptable to Contractor, and hold … Where possible, however, the physician should try to convince the other party to permit a reasonable and equitable clause to replace the far-reaching provisions in some hold harmless clauses. An ophthalmologist’s personal assets are put at risk as a result of hold harmless and other indemnity provisions because the physician’s professional liability policy usually does not cover such actions. The hospital demanded, pursuant to its contract, that the group indemnify it for any costs, etc., associated with defending the lawsuit. • Clinical Issues third-party claims by agreeing to “indemnify and hold harmless” the other party for certain types of claims under limited circumstances. • OMIC Partners Don’t underestimate this benefit; it can add up to tens of thousands of dollars over the course of your career. Managing Risk on the Business Side of Medicine, Over-Utilizing Medical Externs Leads to Allegation of Improper Supervision, Understanding the Risks Associated with Medical Directorships, Inadequate Screening of Clinicians and Staff, False Advertising of a Medical Practice Leads to Allegations of Fraud, Granting Patient Refund Requests: Risks and Benefits, Law and Emergency Medicine: Indemnification Clauses in Emergency Physician Contracts, Indemnification in Healthcare Contracts: Concepts, Coverage and Clauses, Learn more about the NORCAL Group of companies. 23,3 (2010): 313-5. doi:10.1080/08998280.2010.11928641. Typical hold harmless clauses may be constructed as follows: “Physician will indemnify and hold us harmless from loss, damage or cost (including reasonable attorneys’ fees) arising from all of Physician’s willful, wrongful or alleged wrongful acts or omissions under this contract.” Or, “Physician shall indemnify and hold us harmless from any and all liability, loss, damage, claim or expenses of any kind and of whatever nature, including all costs and attorney fees, arising out of the performance of this Contract and for which Physician is solely responsible.”, A clause need not actually contain the words “hold harmless” or indemnify.” Clauses containing language such as “to assume all risks of [certain accidents]” and “this is a release from [certain claims]” also have generated liability.2. Where a clause is written broadly, and no limiting terms have been introduced into the contract, an ophthalmologist consenting to an agreement with a third party opens the door to a host of claims, including those for personal injuries, libel and slander, copyright infringement, contract defaults, employee claims, tax liabilities, the direct and indirect expense of the other provider in doing business, and indirect and consequential damages including interest and loss of profits. An emergency department (ED) physician was part of a group that contracted with a hospital to provide emergency medicine services to patients. In cases of a mutual hold harmless clause, each party should attempt to obtain insurance naming both parties and protecting each from claims of bodily injury, death or property damage arising from the activities of the physician or other party, or their respective agents, servants or employees, associated with the contract. Plaintiffs rarely allege primary negligence on the part of the group and then claim the individual physician has vicarious liability.2. An HHA should … Moreover, an ophthalmologist has no guarantee that litigation will be successful as there is law supporting both sides of the issue. Indemnity clauses appear in a wide variety of business contracts, including those between physicians, their groups, and the hospitals in which they treat patients. A Matter of Law - A troubling aspects of indemnity and hold harmless agreements are circumstances in which insurance agents and brokers are asked to advise customers on the appropriate content of an indemnity or hold harmless agreement. • Administration In general, it is more difficult to negotiate the terms of a contract after it has been signed. Beecher NB, Richardson CH. • Hotline If a patient files a medical malpractice case against a physician, and alleges vicarious liability against the physician’s group, and the physician signed a contract agreeing to indemnify the group, the physician may have agreed to pay for the group’s attorney fees, court costs, verdict, or settlement.1,2. It also sometimes refers to a release of liability and indemnity agreement. The undersigned hereby agrees to indemnify, save harmless, and waives liability of the … The following are examples of what an indemnity clause in a contract between physicians, groups, and hospitals might look like. Sometimes such contract provisions are one-sided, where only one party indemnifies the other; in other cases, the contract provides cross or mutual indemnification where both parties indemnify each other. Indemnification against tort liability-the “Hold Harmless” clause-its interpretation and effect upon insurance. We never sell your personal information. 11/16/2016. • Privacy Statement Larry D. Weiss, MD, JD. Some clauses only require the physician/indemnitor to indemnify the third party/indemnitee for claims resulting from the physician’s own negligence. 19 Colo Law 1081. Defending a claim by the other party to an agreement containing a hold harmless clause or other indemnification provision can be expensive, regardless of whether the physician is trying to prove the provision is unenforceable or that it should be construed differently from the meaning alleged by the third party. An attorney review any contract being considered the owner from the physician who signs the agreement of. Its own risks resolved at a future date, or indemnification clauses,. Assets could be at risk a provision for liability for with these third party and! And precision in choosing words is essential to limiting liability you enter in our online forms may be by. 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