The threat of a medical malpractice suit is an ever present reality for healthcare professionals in the United States. According to a study conducted in 2022, 31.2 percent of physicians reported that they have been sued at some point in their careers. Medical malpractice lawsuits are very common in the litigious world of provider-patient relationships, and doctors can be proven liable. The more patients that a doctor treats, the greater the risk they carry of being the subject of a malpractice suit. It is essential that these vulnerable individuals establish measures to protect their assets in the event of a lawsuit. An attorney can help medical professionals create an airtight plan for protecting their assets and continuing to help people without the fear that they might one day lose everything they have worked so hard for.
Why are doctors so vulnerable to lawsuits?
Many healthcare professionals have the perception that liability insurance offers comprehensive coverage for all potential risks incurred by practicing medicine. However, is it important to know that policies have limitations and in certain circumstances, these limitations can be exploited through legal loopholes –– in other words, even with insurance, you can stand to lose everything in a medical malpractice suit. The more patients you see, the more vulnerable you are to a malpractice suit due to an adverse event occurring or a patient filing a lawsuit. Additionally, lawsuits can attack your assets, and even your spouse’s or children’s assets. Even if you practice in a lawful manner, accidents happen all the time in the medical field and it is better to be protected.
Asset Protection Strategies
It is imperative to note that asset protection strategies only work if you take steps to secure your assets before they are put at risk. A fraudulent transfer – moving assets ahead of known impending legal action – can lead to even more serious legal consequences. Asset protection trusts are the most reliable for the purpose of safeguarding assets.
Most estate planning trusts hold assets intended to be passed down to beneficiaries. Asset protection trusts manage your private property, income, and homes in the event of a lawsuit. When you create an asset protection trust, you transfer legal ownership of the assets within the trust to a trustee. Since these assets are no longer considered personal assets, they cannot be seized or liquidated in the event of a lawsuit.
You can also create an irrevocable trust as part of your estate plan. This way, you will place your assets into a trust that names beneficiaries who will obtain them upon your passing. This will also protect you from certain estate taxes, nursing home costs, and more. While your assets are relatively secure in an irrevocable trust, there is still a chance they may be at risk depending on your state and county laws.
In addition to setting up trusts, it is important to title your assets and ensure there is joint ownership if you have a partner. If you are “tenants by the entirety”, you can often protect that asset from being targeted by a lawsuit because it is also fully owned by your spouse. As a doctor, you are exposed to a plethora of legal risks. Taking measures to protect your assets prior to a lawsuit serves to give you peace of mind and allows you to practice medicine without fear of intimidating consequences in the event of a malpractice suit.
Doctors are extremely vulnerable to medical malpractice suits, and, even if you are confident that your practice lawfully, you should risk as little as possible. To provide you and your loved ones with peace of mind in your daily lives, setting up an effective asset protection plan is a necessary strategy. Take this crucial step, by hiring a knowledgeable attorney who will stand by your side as they help you create the most low-risk and high-reward asset protection plan. If you have any questions or are ready to begin your estate planning journey, please do not hesitate to contact the Law Office of Inna Fershetyn at (718) 333–2394 and schedule your first appointment today.