Tail coverage question - pay or go naked?

[BuzzPhreed]

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Occasional lurker, first time poster. Help me undo a huge life mistake. Advice appreciated.

I'm looking for some advice from other attending anesthesiologists. I have been in private practice for six and a half years. My prior job was fine, but not in a geographically desirable area. I was in a hospital based practice. I had the opportunity to join a private practice group in a nicer location so I took it. That along with the promise of partnership down the road.

I've been here for four months now and after literally the first week and for a variety of reasons I realized that it just was not going to work out. It also became clear off the bat that my chance of making partner in this group is nil. I was enamored with the thought of joining a true private practice group and practicing in this area. I admit to making a stupid rookie mistake in overlooking a lot of yellow flags during the interview process.

Now I've been offered my old job back with more pay, less hassle, and more security. I am going to take it, but need to work on my exit here.

My question to the other attendings on this forum: should I pay the tail coverage or should I go naked? My feeling is that my liability exposure should be minimal. My prior job covered my tail when I left. I haven't asked what the range will be yet from their carrier, but I've heard it's not unreasonable to be in the $20k range for my geographic area. They obviously are not going to pay it.

Any thoughts would be appreciated. I cannot get out of this job fast enough. People coming out of residency, beware. If it's a private practice gig and they don't offer you a clear timeline to partnership don't take the job. I found out after being hired that 6 docs have left this group in the past two years. Of course they don't tell you this during the interview.

 

[deleted126335]

See if you can get a quote on a "nose" from the job that you are going back to. Better yet see if they will cover you as part of your return.

Don't go bare. Granted the risk is probably very low, but you are gambling your life savings and earning potential going forward if you roll snake eyes.

 

[BuzzPhreed]

"Nose" is essentially my next employer paying my "tail"? Or, something different. Not familiar with "nose" coverage.

Thanks.

 

[Mr Wizard]

"Nose" is essentially my next employer paying my "tail"? Or, something different. Not familiar with "nose" coverage.

Thanks.

Yep,
"Nose" is essentially getting your new employer to cover the "tail"

 

[deleted126335]

Yep,
"Nose" is essentially getting your new employer to cover the "tail"

Not quite. Let's say you are employed by employer X who has insurance carrier A. You end your current job on Jan 31 and start your new job Feb 1. with employer Y and carrier B. If you get sued in the future for a patient that you took care of in January, who defends you?
If you have occurrence coverage it is insurance carrier A.
If you buy a tail form insurance carrier A it is insurance carrier A.
If you buy a nose from insurance carrier B it is insurance carrier B. (prior acts coverage)
You could also go bare.
Who pays for a tail or a nose is a separate issue.

 

[2ndyear]

Don't go without tail. Not worth it and can burn bridges down the road. Call your future malpractice carrier for advise, they will likely not take you on again without the tail. One option would be for your new employer to pay it as a condition of rejoining. If you are around a year or less it likely won't be near $20000. Perhaps closer to $5000. Nose may work if same carrier and/or same state. Otherwise unlikely. Consider it an investment in your future.

 

[nimbus]

Can't imagine tail will be more than $10k for 4 mos coverage. And you can pay it pretax. Worth it in my opinion.

I paid $37k early in my career and thought it was worth it then.

 

[aneftp]

OP. Don't feel bad. Many have been burned.

I have posted several times my sister got burned big time in PP 5 year partnership.

She had to pay a $40k tail.

Tail is usually 2.5 x your premiums. Since you literally just started and I am pretty sure they have u on a claims made policy. And you worked 6-7 months when it's all said and done. Your premiums were probably around $5000 for the year.

$5000 x 1/2 of year. So $2500 times 2.5. So looking at around $6000-7000 tail payments.

I have always paid my own occurrence policy or have hospital or group cover me. I will never accept a position without knowing the insurance situation especially in a non academic, non "true" hospital employee position.

The other way to avoid a tail if if an off chance the insurance company you use is also the same as insurance company the other group uses also.

Buying a Nose or head policy is usually 1/3 the cost of a tail. Also 1/3 the policy. If you are sure u didn't have complications. Than a nose is a reasonable alternate to paying full tail.

 

[BuzzPhreed]

Thanks for all of the advice. I will look into the nose coverage but it will be in a different state. So I'm not sure that's going to work. Maybe I can just get my prior and soon again to be future employer to pail my tail since they want me back. We'll see.

Moral of the story: trust your gut. I sensed something was rotten about this job even during the interview but I just couldn't put my finger on it. In the short time I've been there I've even heard a lot of grumbling from other junior anesthesiologists many who this is their first job out of training. That seems to be their model. Hire young-and-dumb (no offense, because I'm one of the dumb) who don't know any better. Beyond just myself I think this practice is going to bleed a little more over the short haul.

Maybe I should try to have a serious talk with one of the gray hairs in the practice before I drop the bomb. They might be clueless. Or they may just not be able to do anything about their problems. Or they might just be planning on selling out in a year or two and not care.

 

[norwood]

Maybe I should try to have a serious talk with one of the gray hairs in the practice before I drop the bomb. They might be clueless. Or they may just not be able to do anything about their problems. Or they might just be planning on selling out in a year or two and not care.

Hard to say based on what we know so far, but if your gut feeling is "can't get away fast enough," it sounds like there are issues beyond the partnership problem.

I assume you've checked your contract and tail coverage is not provided by your current employer?

 

[imfrankie]

Hard to say based on what we know so far, but if your gut feeling is "can't get away fast enough," it sounds like there are issues beyond the partnership problem.

I assume you've checked your contract and tail coverage is not provided by your current employer?

If you're getting out, go to the hospital administration, let them know there are big problems in the anesthesia department, that you mean business, and if they are not part of the solution they are part of the problem. Tell them you'd prefer to walk away and let it go, but you can only do so with your tail covered, otherwise there will have to be further discussions

 

[BIS40]

Hey
Did same thing. Tough lesson, especially these times. Where was this? Where we in same group? Lol
Can PM.
In my group contract seemed malignant and I had lawyer review it who had concerns, but time was passing without pay for me so in good faiths took it. They took me out to dinner the partners, but I never met "employee" level peeps who were all miserable, until once I started. I had them change contract that if they let me go they pay tail, but I was so miserable I left and it was on me to purchase it as pee contract. So originally, they had me paying it no matter what. Good idea for them when your turnover sucks, and people realize false promises of partnership. Check contract provisions, is it mandatory or optional.

 

[ssmallz]

As others have said, look at nose coverage, very cheap compared to tail. That's what I did when I needed to switch malpractice carriers and of saved me >20k

 

[BuzzPhreed]

Thanks everyone for all the advice. I will let you know how it turns out as soon as I know more myself. Couple really good irons in the fire right now.

 

[Gimlet]

As others have said, look at nose coverage, very cheap compared to tail. That's what I did when I needed to switch malpractice carriers and of saved me >20k

I'm confused why nose coverage would be cheaper than tail. Looking at it from the insurance company's perspective, aren't they covering the same amount of risk whether the policy is tail vs. nose?

 

[pgg]

I'm confused why nose coverage would be cheaper than tail. Looking at it from the insurance company's perspective, aren't they covering the same amount of risk whether the policy is tail vs. nose?

Good question, I've wondered the same, and my guess is that
1) the company selling the tail has no reason to offer a competitive rate to a customer who is leaving
2) the company selling the nose is competing for your business and has a reason to offer a competitive rate

 

[ssmallz]

I'm confused why nose coverage would be cheaper than tail. Looking at it from the insurance company's perspective, aren't they covering the same amount of risk whether the policy is tail vs. nose?

B/c tail coverage is for life nose coverage is only for a few years prior and you still need to buy tail coverage later. The whole idea is that you should only have to but 1 tail

 

[BuzzPhreed]

Good news for me. My former and soon to be next (again) employer agreed to pay my tail to get me back. So I'm good. Thanks for the input.