They provide essential care to millions of people. According to a March 2009 article from TheMedica.com, which publishes information on the healthcare industry, of the people receiving care at home, 75
percent of those receive skilled nursing care, indicating a high level of need. Also according to TheMedica.com, while the majority of people requiring home care services are 65 and older, a full 30 percent are disabled, undergoing rehabilitation, recovering from surgery or living with chronic conditions.

In light of these trends, home professional caregivers face a myriad of risks, which can lead to potential costs for a home healthcare agency. For example, a negligence claim was filed after an elderly woman fell and broke her hip. The claim resulted in a $195,000 indemnity loss. In another, a caregiver's physical abuse of a mentally challenged person resulted in $50,000 in defense costs.

Sicker and quicker

As a result of the recession, cost containment has been a key strategy for survival and has contributed significantly to patients being discharged from hospitals and nursing care facilities more quickly and in a more precarious condition. Also, advanced medical technology has made it possible to accommodate sicker people in their homes.

The number of people 65 years and older will increase to 55 million in 2020 from 40 million now, according to the U.S. Dept. of Health and Human Services. Add in the number of people 80 years and over–one of the fastest-growing segments of the population–and it's clear home healthcare workers are treating increasingly frail and sick patients.

There also are significant risks and liabilities beyond home visits. Worker and patient transport is a major issue. In one example, a patient in a wheelchair was being carried up a flight of stairs when the hand grips slipped off. The patient fell out and tumbled down the stairs, suffering serious back and neck injuries.

Many agencies that provide home healthcare workers also work on a contract basis with nursing homes, assisted living facilities and senior housing centers, providing allied healthcare workers as needed. These workers need coverage as well.

Further, agency administrators, medical directors and other agency staff must also be protected. Finally, many allied healthcare workers are independent
contractors. While such workers are sometimes required to provide their own coverage, there is a trend among agencies to cover them under their policies.

Typically, a home healthcare agency's owners or top management will make the buying decision. Larger agencies often have risk managers, who are also integrally involved, and may be an agent or broker's initial point of contact.

To be effective, insurance coverage must be comprehensive, including professional liability and general liability (GL) coverage. While these policies can be purchased separately, it's generally a good idea to work with a single insurance provider to try and avoid gaps in coverage.

Wanted: comprehensive coverage

Policies for home healthcare workers can generally cover:

o Professional liability and general liability of allied medical professionals and facilities

o Medical directors, leased workers, volunteers and students as insureds

o Products/completed operations coverage (included in GL)

o MedPay (included in GL)

o Punitive damages (where insurable by law)

o Personal injury.

Like any other insurance buyers, home healthcare agency owners and managers should expect their operations to be scrutinized carefully. Insurance agents and brokers can also play a role here, working with home healthcare agencies to make themselves more attractive to insurers and underwriters. For one, insurers want to be satisfied that a claim would not shut down the business. Among other factors, insurers look at:

o Claims history, paying particular attention to repeated claims for the same types of errors or negligence, indicating that persistent issues have not been addressed or mitigated effectively

o Staff training to ensure that employees have the skills and knowledge they need to deliver services and treatment in a safe and competent manner

o Hiring procedures and employee background screening, including criminal record and past employment checks

o Ratio of caregivers to patients at a level that enables caregivers to have enough time to provide quality care that is free of mistakes

o Employee licensing and credentials to ensure state requirements are met.

Given that there will be more and sicker people being cared for by home healthcare workers, the need for home healthcare agencies to realize and identify potential liabilities will only become more important in 2010 and beyond. Agents and brokers should be proactive about educating home care and hospice agencies on the risks they face, ensuring that they are protected and able to continue providing care to America's elderly population.