Health Care attorney, Daniel Schulte, answers questions relating to the National Practitioner Data Bank (NPDB). The Q&A can be found in the Journal of the Michigan Dental Association (January 2020) –
Question: My attorney and I are getting close to settling a malpractice claim. The deductible on my malpractice insurance policy is nearly exhausted from my legal fees. I am being advised to consider avoiding a report to the National Practitioner Data Bank (“NPDB”) by paying the settlement amount myself. How does this make sense? Should I not use my available coverage? Can you explain what the NPDB is and how this affects me?
The NPDB began operations pursuant to federal law in 1990. Its stated purpose is to alert state licensing authorities and certain health care entities (for instance, hospitals) about the professional conduct and competence of physicians, dentists, and other health care professionals who may be moving from state to state to avoid detection. The NPDB was designed to collect and make available certain information regarding health care professionals.
Examples of what must be reported include:
1. Malpractice verdicts and settlement payments.
2. Licensure actions and sanctions taken by state boards that censure, reprimand or otherwise place restrictions upon a license.
3. Professional review actions taken by certain health care entities (such as a hospital) that adversely affect clinical privileges for more than 30 days.
4. Adverse actions taken by professional societies resulting from a peer review activity related to a member’s professional competence or conduct.
Reports to the NPDB may only be made by certain entities, including:
- An entity that makes a payment on behalf of a health care professional that resolves a claim of malpractice;
- A state board that has taken adverse action against a licensee;
- A peer review entity of a professional society that has taken adverse action against a member related to his/her professional competence; and
- A hospital that has taken adverse action against a member of its medical staff; etc.
The NPDB may be queried only by certain persons and only for certain purposes. For example, a hospital may query a someone seeking to be admitted to its medical staff, and a state licensing board my query a licensee or potential licensee when investigating his/her professional competence or conduct. Health care professionals can conduct a self-query.
If your malpractice insurer, your professional corporation, or professional limited liability company or anyone else makes a payment on your behalf to resolve a claim of malpractice, that insurer must report the payment to the NPDB. Once the report is made it will become known to all those who can query you on the NPDB. However, if you make the payment yourself there is no obligation for you to make a report to the NPDB. This is likely the reason you are being given the advice to (if you are able) forgo your insurance and make the settlement payment yourself.
Not all NPDB reports will result in further adverse consequences to a dentist. This is especially true for dentists who have not had one before and do not practice in a hospital and are not on a hospital medical staff. If there is more than one NPDB report (especially within a short period of time) already on file, you should strongly consider paying the settlement amount yourself and avoiding another one. Several NPDB reports will likely lead to investigation by the Michigan Board of Dentistry. The best practice would be to consult with your attorney and weigh the risk of a report, your history, the amount of the payment, and other applicable factors when making this decision.
The article can be viewed in the Journal of the Michigan Dental Association, on page 24.
About the author:
Daniel Schulte has more than 25 years of experience helping clients solve tough problems and capitalize on opportunities that require a blend of business and legal expertise. His practice focuses on addressing the legal, business, licensing, and regulatory challenges of health care professionals, organizations, and facilities. Dan understands how legal issues impact business objectives and, as a result, offers his clients practical, results-oriented advice. He is a Certified Public Accountant, former managing partner and current executive committee member of the firm. Dan also serves as co-chair of the firm’s Health Care Practice Group.
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