Statements of Position

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Description

This proposed statement provides guidance on applying generally accepted accounting principles in accounting for uninsured asserted and unasserted medical malpractice claims, captive insurance companies, retrospectively rated premiums, claims-made insurance policies, and trust funds of health care providers. The statement supplements the AICPA Hospital Audit guide. In general, the accrual of the estimated cost of uninsured asserted and unasserted medical malpractice claims should be based primarily on the health provider's own experience. A health care provider insured under a claims-made policy should accrue the cost of providing tail coverage at the end of the current period. A retrospectively rated insurance policy whose ultimate premium is primarily based on the health care provider's experience does not transfer risk. A wholly owned captive insurance subsidiary should accrue estimated claims of its parent based primarily on the parent's own experience. A trust fund established to pay malpractice claims, whether revocable or irrevocable, should be included in the financial statements of a health care provider.

ISBN

ed83-07-22t

Publication Date

1983

Relational Format

Book

Keywords

Insurance, Physicians' liability -- Accounting

Disciplines

Accounting | Taxation

Comments

Originally published by: American Institute of Certified Public Accountants; Copyright and permission to reprint held by: American Institute of Certified Public Accountants; Exposure draft (American Institute of Certified Public Accountants), 1983, July 22

Accounting for asserted and unasserted medical malpractice claims of health care providers and related issues : proposed statement of position;Proposed statement of position : Accounting for asserted and unasserted medical malpractice claims of health care providers and related issues

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