Physician Liability Webinar 10 09


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Physician Liability Webinar 10 09

  1. 1. Methods to Reducing Your Liability<br />Minneapolis Physician Resource Group<br />Minneapolis physician resource group, services provided by other members of the group <br />and other services that may be referred, are not affiliated with or endorsed by LPL Financial. <br />Michael Arnold is a registered representative of LPL Financial. Member FINRA/SIPC<br />
  2. 2. Physician Liability Increasing<br />Medical errors affect 1.5 Million people every year<br />Since 1987 the cost of professional liability insurance has gone up 52%<br />The median medical malpractice claim in 2001 was $135,000. The inflation rate is 6.2%.<br />Extrapolating the 2009 figure to $220,000<br />Source:<br />
  3. 3. What options do you have to protect yourself?<br />Prudence<br />Proper Med Mal insurance<br />Smart asset ownership:<br />Use corporate entities<br />Place assets in ERISA governed retirement plans<br />Personal liability umbrella<br />Business liability insurance<br />Transfer assets to your spouse<br />Transfer assets to family with Irrevocable Trust<br />Qualified Personal Residence Trust<br />Domestic and International Asset Protection Trust<br />Understand Minnesota State Statutes<br />Minnesota homestead regulations<br />
  4. 4. Medical Malpractice Protection<br />First line of defense<br />Review your coverage with your agent to ensure you have the proper coverage<br />What type do you have?<br />Occurrence Policy<br />Claims Made Policy<br />Which one give you more protection?<br />Look for your per occurrence cap on the policy<br />Can it be raised higher?<br />Source: The Synthesis Project<br />
  5. 5. Use Business Entities to Create a Layer of Protection<br />Build a wall around your assets<br />Limited Partnerships<br />Limited Liability Company<br />S Corporation<br />C Corporation<br />Practical tips<br />Follow the formalities of the entity<br />Keep books and records<br />Do not comingle money or use business money for personal expenses<br />Source: Matt Shea Attorney Gray Plant Mooty<br />
  6. 6. Retirement Assets<br />ERISA governed plans are generally more secure source of asset protection<br />Consider establishing pension plans, profit sharing plans, 401k plans<br />IRAs are not as secure. In Minnesota generally only protected for the first $30,000. <br />Source: United States bankruptcy code 11 USC§ 522 and MN Statute 550.37 <br />
  7. 7. Personal Liability Umbrella<br />Umbrella protects you against everyday events in life. Most people only covered to $100,000 - $250,000. In today’s age of lawsuits having more coverage is good idea.<br />Call your agent and add on Personal Liability Umbrella Protection <br />1 Million $200-$300 per year<br />2 Million $350-$400 per year<br />
  8. 8. Business Liability Protection<br />Review your current coverage<br />Ensure you have the proper types of coverage and proper limits<br />Consider reviewing your deductibles to keep cost in line<br />Consider shopping coverage<br />
  9. 9. Transfer Assets to your Spouse<br />One spouse usually has far less liability exposure than the other<br />Spouses are not generally liable for the other spouses debts<br />Title of asset does not change the martial versus non-marital character of the asset for marital disolution purposes<br />This strategy may also provide estate tax planning benefits by balancing the estates between spouses<br />Frequently, we recommend transferring the homestead and other financial assets to the other spouse<br />
  10. 10. Establish Irrevocable Trust<br />Transfer your assets to an Irrevocable Trust for the benefit of family members<br />You make an irrevocable gift<br />Pro: The asset is out of your name and cannot be touched by a suit brought against you<br />Con: You no longer have control or incidence of ownership of the asset<br />Source: Matt Shea Attorney Gray Plant Mooty<br />
  11. 11. Qualified Personal Residence Trust<br />Transfer your principal residence into a Residence Trust<br />After a set number of years (often 20) the house becomes the property of the beneficiary (son or daughter)<br />You no longer have ownership of the property protecting it from your creditors<br />You can continue living in the property at a fair rate<br />Source: Matt Shea Attorney Gray Plant Mooty<br />
  12. 12. Domestic and International Asset Protection Trust<br />A type of trust funded by you for your benefit with another person or company appointed as trustee<br />Affords protection from creditors even though you are contributing your own assets to your own trust for your benefit. <br />Normally when you fund a Trust for your own benefit , it is not protected from your creditors.<br />Domestic Trusts are available in only a few states: Delaware, Nevada, Alaska, South Dakota, Rhode Island, Utah in addition to a few others.<br />Source: Matt Shea Attorney Gray Plant Mooty<br />
  13. 13. Use Minnesota Homestead Regulations<br />Minnesota Homestead Exemption is $300,000 for residential property<br />Homestead Exemption for agricultural property is $750,000 (up to 160 acres)<br />Source: MN Statute 550.37 <br />
  14. 14. Other Minnesota Statutes<br />IRA and similar assets: standard exemption amount is $30,000 but can be more to the extent reasonably necessary for the support of the debtor and any spouse or dependent of the debtor. <br />MN Statute 550.37 Subd. 24<br />
  15. 15. Other Minnesota Statutes<br />Earnings earned by a minor child<br />Life Insurance: $4,000<br />Farm Machinery: $13,000<br />MN Statute 550.37<br />
  16. 16. How can you implement your asset protection plan?<br />Contact a CERTIFIED FINANCIAL PLANNER™ Professional skilled in retirement plan management and coordinating with other professionals on your specialized needs.<br />Contact a lawyer with skills in asset protection issues<br />Contact your insurance agent(s) and discuss your current liability protection policies<br />
  17. 17. Minneapolis Physician Resource Group<br />We are a group of local Twin Cities professionals who have come together to provide expertise for local Physicians in the following areas:<br />Financial Planning – CERTIFIED FINANCIAL PLANNER™ Professional<br />Legal – Gray Plant Mooty<br />Tax – DS & B<br />Business valuation – DS&B<br />Electronic health records<br />Insurance<br />Real Estate <br />Business Consulting<br />
  18. 18. Next Steps<br />We welcome your request to meet with member(s) of the team<br />Receive information to help improve your situation<br />Minneapolis Physician Resource GroupContact Informationwww.minneapolisphyisicanresourcegroup.com612 216 2075<br />Minneapolis physician resource group, services provided by other members of the group <br />and other services that may be referred, are not affiliated with or endorsed by LPL Financial. Michael Arnold is a registered representative of LPL Financial. Member FINRA/SIPC<br />