Canyon Clifton is an aesthetic malpractice insurance specialist. He focuses in the areas of Medical Malpractice Insurance, Professional Liability, General Liability, Oil & Gas & Specialty E&O Insurance. He is CEO of Clifton Insurance, which writes globally, and is able to capture all carriers to obtain multiple quotes in all areas. His main areas of specialty are Medical Spa-Day Spas, CRNAs, PAs, Birthing Centers, Midwives, Anesthesia Groups, Urgent Care Facilities, Law Firms and much more.
Canyon Clifton answered all my pressing insurance questions about aesthetic malpractice policies. He seems to have almost seen it all when it comes to policy claims. He has endless knowledge and patience with explaining the ins and outs of these insurance plans.
How to contact Clifton Insurance
Please find out more about him and Clifton Insurance by calling him directly at 877-212-4368 ext. 102 and more details on their site: https://www.cliftoninsuranceagency.com/medical-malpractice-insurance/medical-spa-malpractice-insurance/
Also, check out Part I of this series here.
What do you need to be on the lookout for if you find a “too good to be true” priced policy?
I told Canyon I had a friend doing the same thing and her policy was less than half of what I am paying. I asked him, “What are some red flags to look for in a policy that the price seems surprisingly low?” He said:
“There’s a lot of different factors that are relative to pricing. The insurance companies, the way they look at it, if you have a friend in Portland, OR they may have a completely different price than what you are paying in Miami Dade County, FL. The aesthetic malpractice insurance companies charge based on where the most frequent number of claims come from as one of their deciding factors.
They have categories based on those claim numbers, class 1 all the way up to class 4. Amarillo, TX would be like a class 1, Los Angeles, CA is a class 4 because there is a lot of medical malpractice claims that are aesthetics-based that come out of that area. They break it all the way down into counties sometimes. Someone might be able to get a policy for $800 in one location but someone 5 or 10 hours away might be paying double or more for being in a high risk area.
I can’t say if something is too good to be true without seeing the structure of the policy. A lot of policies that are out there could be like $30/month for just injecting botox and filler. But typically what we see with most of our clientele is that they start out doing a couple of things like botox and fillers, but then they get requests for more and more things. Then as you try to add things, they won’t cover those.
The premium is based on location, revenue, services, employees, physical office location. If you go through a specific carrier, and you’re doing 5 hours a week you might be able to add on to that for an extra $150 or $500 a year. It goes back to will my current policy cover me?
You have to ask yourself if you want to have the risk of having your aesthetic malpractice insurance liability on the same policy as your professional CRNA malpractice insurance. Because if I ever have an aesthetics based claim, it’s going to raise the rate on my CRNA malpractice insurance because that’s my highest area of classification under that policy. So if you’re a CRNA and you’re with an insurance carrier and you have a $150,000 aesthetics claim, your CRNA med mal may go from $6500/year to $9500/year. And now since it was under the same policy, whenever you go to get credentialed as a CRNA and they ask if you have ever had a claim, you will have to say yes. You can say it was aesthetics based claim, it will be on your report as a CRNA.”
Policy cost is highly dependent by location and services covered.
How does mobile vs. office based practice affect your insurance policy?
“Some clinicians start out with a mobile business. Whether it is renting space from a number of locations or doing in-home botox parties. I asked Canyon, “How does a mobile business set-up compare to office based in terms of cost for malpractice?” Here’ what he told me:
“It’s a little more expensive to have a mobile based policy, because you aren’t able to control the environment as much. It cost a little bit more, but not much. You’re looking at an additional $150 to your policy, give or take.
Whatever model you choose, make sure when you fill out your expected number of injections and projected income that it is reasonable. Be as accurate as possible with how much you expect to make. Don’t say you’re going to do 280 botox procedures and make $15,000. They are going to do the math and see that doesn’t add up.
You don’t want to overestimate, however. The insurance company realizes you don’t have all the answers. If you’re part time and you keep you’re revenue at $30,000 or less, your cost category is going to be the same as someone who estimates $10,000. You don’t want to overestimate and bump yourself into a higher cost category. On the flip side if your income is much higher than expected, then the next year your premium could be increased on renewal.
If you have any questions about your aesthetic malpractice insurance always contact your agent. Especially you’re first year in business the insurance carrier gives you a lot of leeway. One thing that will make your premiums go up is of course if you have a claim. The other thing that increases premiums is adding different services. For example adding laser hair removal. There are a lot of claims made with laser hair removal. Carriers also re-evaluate price each year. Premiums can fluctuate just like the rest of the market.”
If you are planning to do a mobile business, expect a little higher premiums. Also don’t hesitate to see help from your agent as you fill out your application. They should be able to help guide you through estimated income projections for your first year.
Is there a difference in premiums for NPs and PAs vs MDs?
I wondered how your practice background affected malpractice insurance coverage. I asked Canyon, “Are insurance premiums higher based on your clinical experience and title?” His answer to this questions surprised me:
“MD and DO policies will always be more expensive, even if they are doing the exact same thing. The reason being is people see the title MD or DO, they are more likely to sue you. The preconceived notion is that a doctor has more money and a better payout for the person suing. It’s a stereotype. You’re still dealing with the general public and they like to get free money. You don’t know who is going to get laser hair removal then go on a cruise and tan and give themselves a massive sunburn and get a lawyer and sue.”
Contrary to what many may think, a MD or DO policy is going to come at a higher price than a NP or PA, typically. Sad, but true.
Why is alcohol a concern when it comes to botox parties?
The stereotype of a “botox party” brings to mind Orange County housewives drinking champagne. Maybe it’s the “party” in there that creates the confusion. I asked Canyon, “What are the legal concerns of alcohol at botox parties?” He simply answered this:
“It’s just that people don’t make wonderful decisions when drinking alcohol. If you’re going to do botox parties you can’t control every situation. So one thing you can do is send the informed consent to members of a botox party ahead of time. In this consent, that they can sign before coming to the party, state they will not be serving alcohol, before or after the procedures have taken place. Get signatures on this informed consent agreeing to no alcohol and understanding that this is a real medical procedure. There are complications that can occur with any medical procedure. You don’t want to give their plaintiff attorney any ammunition against you. And any alcohol present will do that.”
In summation of Canyon, do your part to ensure alcohol is not a part of this type of “party”.
What are the most common mistakes you see with aesthetic malpractice insurance?
Canyon deals with insurance claims filed on a daily bases. I asked him, “What mistakes are you seeing in the aesthetic injections business over and over?” He had some good advice:
“The most common mistake we see is providers just not running their business the way they should. Not screening correctly with informed consent. They aren’t taking before and after photos. They’re not doing what they need to do to protect their business from a lawsuit. People assume ‘I’m doing this feel-good thing on a part-time basis, or for friends and family, so I’m safe’. But you are running a business and working with the public. You need to be on the defense of how to protect your business. You can get sued for something frivolous, even if no one has a poor outcome. Our agency can also work with individuals or companies to assist or set a game plan for lawsuit prevention”
Canyon urges all aesthetic injectors to do their homework on the business and risk management end first. He emphasizes prevention of a lawsuit is important.
Are most claims related to poor outcomes?
“It seems like common sense that the majority of claims made in aesthetics would be due to poor or undesired outcomes. So, I asked Canyon, “Are most aesthetic claims made to insurance related to poor outcomes?” This answer really surprised me:
“No. 80% of claims are frivolous. Because the provider didn’t get the proper paperwork, or the right verbiage in the consent, or didn’t have before and after photos. Keep proof that the procedure went as planned. I’ve seen people get sued for someone accidentally leaving a wedding ring at a spa. That wouldn’t have happened if they had a locker and key for valuables and stated they are not responsible for lost valuables.
You need to do your research. It’s a great opportunity, but with it comes an element of risk. Buying insurance is an investment into your business. It’s difficult to understand if I’m going to make $15,000 this year, why is my insurance $2,000. The answer- if you are getting an A rated carrier, you’re getting all the coverage you need, and that’s their minimum premium. You’re paying $2,000 per year but they are willing to pay out a million dollars if you get sued. I see providers put the cart before the horse. They plan to do the risk management and business part later, and get too busy. State medical boards can come in and get people in trouble even because they aren’t advertising correctly. You need to do the research, to have the informed consents, and learn risk management. Educate yourself about business.”
Most claims made against providers are not due to a clinically poor outcome. Most of them are due to lack of preparation on the business side of things.
How do you choose the right insurance agent for your malpractice insurance?
Clifton Insurance is my insurance company that provides my aesthetic malpractice insurance policy. Canyon and his brother Cooper run this family business which was started by their father who happened to be a CRNA. I’ve been impressed with the customer service and very appreciative of Canyon for his time to educate providers on this integral part of practice. Clifton Insurance provided me with a number of quotes from multiple carriers to compare .These options included both admitted (back by the state) and not-admitted (not backed by the state) A+ carriers.