Retirement. The word conjures up an image of relaxation and a leisurely lifestyle. But for many healthcare professionals, the picture is one of a life nearly as busy as when they were working full-time. Many retirees choose to volunteer – whether responding to disasters, working at a pop-up clinic in an underserved area, answering questions for community members, or other activities.
When engaging in these types of post-retirement activities, healthcare professionals can easily forget that they still need legal protection for their actions. However, if you have a healthcare license, you need both professional liability and license protection insurance coverage. This also applies if you are working part-time or per diem – for example, teaching a course or two at a local community college as you transition to retirement. It also applies if you are asked to provide a deposition as a witness – even if you did not provide direct patient care.
Liability and License Protection Coverage
Professional liability insurance is essential for protection in the event you are accused of malpractice. Even those who consistently follow best practices can make a mistake that results in patient harm or find themselves named in a lawsuit. Even if you are ultimately cleared of liability, you may still incur legal fees – professional liability insurance can help cover those costs.
There are
two types of liability insurance coverage:
occurrence and
claims-made.
- Occurrence policies are often preferred because they provide broader protection. If the incident occurred while the policy was active, coverage applies even if the policy has expired or been canceled.
- Claims-made policies only provide coverage if both the incident and the claim occur while the policy is active.
License protection coverage is also critical, as it helps provide resources to defend against actions related to a state licensing board investigation. For example, if a complaint arises from something posted on
social media, license protection coverage can help pay for legal representation during the investigation.
Healthcare professionals should understand that disciplinary action in one state may lead to action in other states where they hold a license – known as reciprocal enforcement. Additionally, some jurisdictions issue licenses that remain active for life, meaning professionals could face discipline even if they are no longer actively practicing. Regulatory actions may also come from agencies beyond the licensing board, such as a state health department. These risks make appropriate insurance coverage essential.
Weighing Options
Some states offer different license types depending on practice status. For example:
- A volunteer license may allow practice without compensation (e.g., volunteering at a community clinic), while still requiring background checks.
- Inactive status means the individual cannot practice healthcare in any capacity.
Check with your state licensing board to understand available options.
As your level of involvement changes, ensure you have the appropriate education and credentials to perform your activities. It’s also wise to review your licensure status and insurance coverage with your insurer to confirm that you have adequate protection and are taking advantage of any applicable discounts (
HPSO offers a discounted rate of up to 50% for providers who are retired or taking a leave of absence).
Cutting Ties
At some point, you may decide to stop providing healthcare services entirely and choose not to renew your license. In that case, notify your licensing board and complete the required process (which may include forms and fees) to move to inactive status. This step is preferable to simply letting your license lapse, as it makes future reactivation easier if your situation changes.
If you carry a claims-made policy, you will also need to obtain
tail coverage, which protects you against legal actions related to incidents that occurred before you stopped practicing.
Peace of Mind
Retirement should reduce stress – not increase it. If you maintain your license after retiring, be sure to continue liability and license protection coverage to reduce the financial and emotional impact of potential legal issues. With that peace of mind, you can fully enjoy your retirement.
Getting Ready to Retire: Checklist for Healthcare Professionals
Licensure and Certification
Legal
Financial
Personal and Lifestyle Considerations