Blog Layout

LOOKING TO ADD NEW INSURDES AND RETAIN LARGE ACCOUNTS? THE CLAIMS-PAID POLICY FORM MIGHT BE FOR YOU

April 5, 2022

By collecting additional reserve money, a Claims-Made carrier will charge an annual premium for all claims anticipated to be reported. When a Member reports a claim, the carrier may now use previously collected funds to resolve it. When the carrier assumes liability for a claim, the Member can then depart to secure retroactive coverage from a different carrier.


The Claims-Paid alternative differs considerably. The Continuing Care Risk Retention Group, Inc. (CCRRG) does not collect reserves, so Members pay less annually than they would with a Claims-Made carrier. In exchange for lower premiums, Members must agree to one of three options. They must purchase coverage for an extended reporting period (ERP), remain with CCRRG until their pending claims are resolved, or assume responsibility for the outstanding balance of their claims at the time they choose to terminate their membership. 


CCRRG agrees to "Pay" amounts within policy limits for "Damages" related to "Property Damage" or "Bodily Injury" where this insurance is applicable. This is done on behalf of a "Member" who takes on a legally binding obligation to "Pay" the amount determined by an arbitrator, court, or any other administrative tribunal while they were a CCRRG "Member."


The company will "Pay" for a "Claim" that is reported for and "Occurs" during the "Policy Period":



  1. when it is a legally binding obligation for the "Member" while the "Claim" is declared during the "Policy Period; and
  2. while the "Member" continues to be a "Member" when legally obligated to "Pay" the "Claim."

The patent-pending Claims-Paid PL/GL form has been granted to Magnolia LTC Management Services and CCRRG for exclusive use. This was granted by the Cooperative of American Physicians (CAP) for institutional long-term care facilities anywhere in the U.S.

Don’t Pay for Claims That May Never Be Reported

CCRRG's Claims-Paid policy is a unique alternative to CCRRG's Claims-Made policy form. 


Under the Claims-Paid policy, Members will enjoy premium savings without giving up the competitive, reliable, and stable coverage they receive under the Claims-Made policy. 


How CCRRG Does It

  • Traditional insurance companies typically offer pricing formulas that add estimates of possible future losses, increasing company expenses. CCRRG Members/Insureds who opt for the Claims-Paid policy never have to pay for reserves for incidents that might not result in a claim. 
  • The CCRRG Claims-Paid premium is determined by the costs of running CCRRG, along with projected costs of present and anticipated claims per program year.
  • If a Member/Insured opts to leave the Claims-Paid program with one or multiple open claims, they can either take their claim(s) with them or purchase an ERP endorsement.
  • If a Member/Insured chooses not to purchase extra coverage for an ERP upon leaving the program, CCRRG will support defense costs on open Claims-Paid claim(s) after the final day of coverage for 30 days. This provides the former Member/Insured an adequate amount of time to acquire their own defense counsel. 

Raising the Minimum Wage in LTC and How to Hire Well

By Bob Bates • May 21, 2024
Is California the Canary in the Coal Mine? While it has always been tough hiring and retaining staff in LTC facilities, it will undoubtedly continue to be a challenging time. Entry level staff currently have other, more lucrative hiring opportunities, e.g., with fast food starting at $20.00 per hour in CA, and with none of the same caregiving stressors that LTC employees face. Combine this with the potential of CA Senate Bill 525, signed by the Governor in October 2023, which may increase the minimum wage for health care workers to $25 per hour in the coming years, but would also require higher staffing ratios if triggered, this may boost applicants but it will certainly strain facility budgets. However, with a strategic hiring process and a thoughtful employee retention program, you will be able to hire excellent staff and keep them for many years to come. You can read the full article on our client's site, CCRRG.

Why Site Visits are Important

By Bob Bates • May 21, 2024
As you may know, Magnolia LTC works closely with CCRRG to manage its daily operations, including risk management for its clients. And, CCRRG recently published an article regarding the importance of Magnolia LTC site visits and how they can help provide LTC facilities not only with better tailored coverage, but also opportunities to save them money and reduce claims, all while providing their residents with better care.

Inflation Is Another Challenge In The Long Term Care Industry

By Magnolia Team • April 5, 2022
It seems there is nothing left untouched by the pandemic, and it’s no surprise that Long-Term Care Industry is at the forefront of the crisis. Long Term Care, already hit with the challenge of an aging population and staffing issues, and then Covid, now faces another challenge - inflation. According to Denise Chamberlain, Executive Vice President & CFO of Edward-Elmhurst Health, “labor inflation is currently unprecedented. According to Kaufman Hall, a healthcare advisory firm, for the month of September 2021, labor costs were up 18.4% compared to the same month in 2020 (healthcare labor costs have typically risen 3% to 5% per year). EEH's number is not quite as high yet, but it is climbing as additional pay increases and incentives are being put in place to try to stabilize the workforce." With payroll increases and temporary nursing positions offering financial incentives for healthcare workers to leave their current positions, facilities face a significant financial burden and crisis. Long Term Care Facilities of all sizes and stripes are trying to keep up with higher wages and excessive overtime fees, which may leave them short-staffed at a time of escalating costs. These shortages were already established pre-pandemic, but Covid sharply increased the amount of workers leaving the industry without any time to properly train the new workers. But staffing issues are only one of the major challenges facing healthcare workers & institutions. Inflation driving up drug prices Healthcare is not only affected financially by its staffing crisis but also by the rise of drug prices. Chamberlain states that “according to the Kaufman Hall report, the average drug cost per resident in September 2021 was up 40.4% compared to September 2020." Supply chain creates healthcare problems If declining revenues and staffing shortages weren’t enough, like many other industries, healthcare firms are feeling the pains of the supply chain issues as well. Healthcare leaders note their difficulties in getting the proper equipment, drugs, and technology needed to properly treat patients and residents. As the prices exponentially grow, they’re having to find alternative treatment solutions, while the supply chain challenges drive inflation up even more. What can Long Term Care Facility owners do to combat these challenges? While we’re hit with various challenges due to the pandemic and inflation, healthcare leaders need to stay smart and strong because these problems aren’t going anywhere. It’s predicted that the staffing shortage will resolve in several years, so what can you do in the meantime? Mallory Caldwell, US Health Leader at EY, gives some tangible takeaways, saying that CFOs should: "Dig deeper in identifying near-term operational efficiencies." "Continue driving longer-term strategies to reimagine the care and wellness delivery system." "Explore new technology, digital, and data investments to improve processes." "Seek out a variety of potential partnerships, both within the sector and with less conventional collaborators, who can help extend and expand hospital and health systems' market presence."
Share by: