Over the years, group practices have been structured through more traditional arrangements such as proprietorships, partnerships or corporations. As a counselor or human development professional participating in one of these traditional business structures, you can protect yourself by sharing in professional liability coverage under a group policy. A group policy protects the business owner as well as employees and independent contractors working on behalf of the group.

But what do you do about professional liability protection if you are part of the growing trend of counseling professionals who choose less formal business relationships? Many practitioners are now sharing office space and aligning themselves with other professionals to increase their ability to attract and serve clients while at the same time reduce costs. Although there are many positive aspects to these arrangements, you need to be aware that this type of business setting can increase your risk of liability.

Creating a shared office space arrangement and sharing a location name such as “Valley Counseling Center” can give the appearance that you work in a group practice and, as a result, should share in the responsibility for any negligent acts performed by the counseling professionals in that space. To protect yourself in the event that you are named in a lawsuit, purchase an individual professional liability policy. An individual policy not only protects you for the services you offer but also gives you peace of mind that your insurance carrier will provide legal defense if you are brought into a lawsuit because of the actions of others.

How can you be sure that purchasing an individual policy is the right answer? If you do not have a formal agreement with the counselors who share your office space, answer the following questions to determine if you should purchase an individual policy:

  • Do you share clients?
  • Do you conduct group sessions with one or more counseling professionals?
  • Do you share office staff?
  • Do you store client records in a common area?
  • Do you share fees with other practitioners?
  • Do you post a sign on the office door with a name that leads the public to think you are a group practice?
  • Do you consult with other counseling professionals about their clients?

If you answered yes to any of these questions, then you need to purchase an individual professional liability policy.

In addition to the protection an individual professional policy affords, you can take additional steps to reduce your risk of malpractice lawsuits if you share office space:

  • Consider establishing an office share agreement that details the expectations of others who share the office space. The expectations would include, but not be limited to, requiring the counselors who share the space to carry their own professional liability coverage.
  • Require all counseling professionals sharing office space to maintain their own professional liability insurance and be sure that they carry the same limits of liability as you. Even if you are not negligent, the courts may look to the professional liability policy with the highest limits of coverage to pay client damages, and you don’t want your policy limits to pay the claim. Ask for a copy of their policies at each renewal and for confirmation that the policies have been paid. Keep this information on file in the event of a claim.
  • Always check the references of new professionals joining the shared office setting to make certain they are qualified to provide counseling services under your state’s practice act. Bringing in someone who may not be qualified to practice makes you vulnerable to a lawsuit.
  • Educate your clients on your relationship with the other counselors. You may want to provide them with a statement about your practice, making it clear that you are an individual practitioner and not part of a group practice. Make sure that the other counseling professionals follow the same procedure.
  • Keep client records separate. If others have access to your clients’ records, you could be subject to a lawsuit for not safeguarding your clients’ privacy.
  • Consider adding phone lines with separate numbers for each of the counseling professionals sharing office space. Make certain that the office staff answers your phone line using your practice name and not the shared space name. This will make it clearer to the public that you are not part of a group practice. Also, protect client privacy by not using client names during peer consultation sessions. Use the term “peer consultation” rather than “peer supervision,” as the word “supervision” implies that you have a level of responsibility for the actions of others. That perceived responsibility could bring you into a lawsuit.
  • Establish and document office procedures so there is objective documentation of your office practices in the event of a lawsuit. Require the other counselors to do the same.

Safeguard yourself and your clients in a shared office setting. Be sure to secure the right kind of professional liability insurance coverage for your practice needs. If you have any questions about the type of coverage that best suits your practice, consider contacting the American Counseling Association Insurance Trust staff. We will be pleased to answer any questions you have concerning group coverage. Call the ACA Insurance Trust at 800.347.6647 ext. 342.

Paul Nelson is the executive director of the ACA Insurance Trust. Contact him at pnelson.acait@counseling.org.