9 practices create malpractice firm
New insurer includes 100 local doctors
By Michael Schroeder
The Journal Gazette
After much collaboration, nine Fort Wayne-based medical practices, employing nearly 100 doctors, have formed their own medical malpractice insurance company.
The result, Fort Wayne Medical Assurance Co., incorporated under the Federal Risk Retention Group Act, will cover those practices. It also will offer coverage options for other medical groups in northeast Indiana.
Company officials say the organization, which is in the process of writing policies for its members, will offer more flexibility in underwriting and more involvement from physicians in risk management than traditional insurance models. The intent is to control cost and optimize care by tying improvements in patient safety to premium rates, according to the head of the company.
â€œWe have studied many successful models,â€? said Dr. Bill Cast, president of Fort Wayne Medical Assurance. â€œThe (risk retention group) industry as a means to control and manage companyâ€™s insurance needs is gaining momentum all over the country, particularly here in Indiana.â€?
A risk retention group essentially self-insures by contributing money to cover the liability of the group.
The companyâ€™s formation, which included raising about $1â€‚million, took nearly three years and numerous refinements, said Cast, a partner at Ear, Nose & Throat Specialists, which has seven area locations. In addition to Cast, company officers include Steve Smith, administrator for Fort Wayne Neurology, Fort Wayne Neurosurgery and Tri-State Physical Medicine/Rehabilitation; and Dr. Dale Sloan of Indiana Surgical Specialists LLC.
The company will initially cover those five groups along with Indiana Ohio Heart, Ophthalmology Consultants, Orthopaedics Northeast and Radiation Oncology Associates.
Because Indiana doesnâ€™t have a law enabling the formation of such a risk retention group, Fort Wayne Medical Assurance was incorporated under Arizona law. The companyâ€™s primary office for regulatory purposes will be in Phoenix. Its operations and service office is in Fort Wayne at 709 S. Clay St.
Similar to any other company based outside the state, Fort Wayne Medical Assurance will have to abide by Indiana laws, Cast said.
And doctors wonâ€™t be taking on the complex, time-consuming challenges associated with self-insuring alone, he said.
AON Risk Managers, an international insurance services company with offices in Indianapolis, will provide support services including actuarial forecasting, underwriting, risk management and claims administration.