Shared vs Separate limits for NPs and PAs
What's the difference between shared and separate limits for affiliate health professionals like nurse practitioners and physician assistants?
A commonly asked question we receive is if Nurse Practitioners and Physician Assistants should be on a shared limits policy or a separate limits policy. A shared limits policy is when the nurse practitioner or physician assistant shares the same policy and is added on to the physician’s existing policy or if it’s a group, the entity’s limits. Even though there is an additional person on the policy, the liability limits do not necessarily need to increase.
A separate limits policy is when the NP or PA gets their own separate set of limits. In this case, they would need to have the same limits of liability as the physician they are practicing with. For example, if the physician has $1,000,000/ $3,000,000 limits of liability, as would the NP or PA who has a separate limits policy.
The key differences between a shared and separate limits policy for a NP or PA are tail coverage and price. Tail coverage, also known as extending reporting period endorsement, allows a physician to extend coverage after cancelling or terminating their claims-made policy. For a shared policy with The Doctors Company, tail coverage would not need to be purchased when the NP or PA leaves the practice or retires, they are covered under the physician or the corporation.
If on a separate limits policy, the NP or PA would need to purchase tail coverage upon leaving the practice. For example, when a physician cancels the shared policy or retires, they purchase tail (or nose coverage) for their policy, which will include their NPs and PAs. Premiums for a shared policy are generally less expensive than a separate limits policy, and when you account for not having to purchase tail coverage, it can be significantly less expensive all together.