Lack of understanding of the legal concept of vicarious liability may underlie certain barriers to nurse-midwifery practice. Malpractice insurance surcharges, denial or restrictive limitation of clinical privileges, and physician “supervision” requirements may all be premised, at least in part, upon an assumption that physicians who work with, and hospitals that grant clinical privileges to, nurse-midwives will automatically be liable for any negligent actions or omissions of CNMs. This article examines the basis for such assumptions and, based upon research into the current case law on this subject, concludes that popular assumptions regarding physician/CNM or hospital/CNM vicarious liability are unfounded. According to the author's research, no reported cases exist to support that assumption. Vicarious liability arises from the relationship between two parties and is imposed solely on the basis of the relationship. An employer is almost always vicariously liable for the negligent actions or omissions of his employee. If a nurse-midwife is the bona fide employee of a hospital or physician, the latter will most likely be subject to vicarious liability. Absent of any employment relationship, however, such liability will not necessarily be imposed. Rather, the result will vary depending upon the facts of each case, and each professional's relative degree of fault would be determined upon the basis of his or her own actions. Hospital liability for nonemployee nurse-midwives who hold clinical privileges should be no different from hospital liability for physician members of its medical staff—that is, in most cases the hospital will not be vicariously liable for the negligence of its nonemployee staff, but will be directly liable for its own negligence if it failed to credential or monitor the performance of its staff members properly. A malpractice surcharge case, and the insurance principles and data that may be derived from that case, are also discussed.