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Government plans could increase GP indemnity costs

Consultation on clinical negligence cover launched

Adrian O'Dowd

Friday, 07 December 2018


Government plans to reform indemnity cover for healthcare professionals not covered by state-backed schemes could push up the cost of indemnity for everyone including GPs, it has been revealed.

The Department of Health and Social care has published a consultation* on appropriate clinical negligence cover for healthcare professionals who buy their own indemnity cover because they are not covered by existing or proposed state-backed schemes.

It applies mostly to:

  • regulated professionals in the NHS who hold indemnity cover which is not currently regulated, such as primary care dentistry
  • private practice of medical doctors and other regulated healthcare professionals
  • healthcare professionals in Northern Ireland and Scotland who are not covered by any state-backed indemnity scheme, such as GPs.
The government is seeking views on whether it should leave arrangements as they are or change legislation to require healthcare professionals who are not covered by any state-backed scheme to hold cover that is regulated.

It is concerned that under the current arrangements, healthcare professionals who are not covered by state-backed schemes could prevent patients getting appropriate compensation for negligence and put healthcare professionals at risk of being personally liable for the costs of claims.

This is because these arrangements are mostly discretionary, where the providers are not contractually obliged to meet the costs of any claim and are not subject to prudential or financial conduct regulation.

Costs overall, however, could rise as a result of the proposed changes, says the consultation document, as the government is seeking to impose a cost increase on health professionals by moving to an insurance-based model that will attract a 12% insurance premium tax.

The document says: “There are potential difficulties arising from a move to a regulated product. In the transition, current providers may be unable to, or choose not to, continue to provide cover and there could be higher overall costs of clinical negligence cover.”

GPs in England and Wales will benefit from a state-backed indemnity scheme from April 2019, as a way of improving the affordability of indemnity for GPs although it was revealed recently that funding for the scheme is likely to come from existing resources allocated to general practice.

Medical defence body the MDDUS had concerns about the proposed changes and its chief executive Chris Kenny said: “This consultation is yet another missed opportunity to tackle the real issues that drive rising costs for healthcare professionals.

“Instead of supporting choice and proposing concrete actions on legal reform that would make a real difference, the government is seeking to impose a cost increase on health professionals by moving to an insurance-based model that will attract a 12% insurance premium tax.

“Patients will not be better protected – the document acknowledges that there is no evidence of harm in the UK from the current discretionary model. Doctors and dentists will gain no benefit. The only winner is the Treasury with its additional 12% premium tax income.

“In short, there is little evidence to support the proposals, nor indeed that there is a real problem to be resolved other than increasing competition and transparency.”

Simon Kayll, chief executive at MPS, said: “We are working with the government on their proposal to regulate professional indemnity, contributing our knowledge and experience to ensure that members’ needs remain at the forefront of any decisions made.

“We are already exploring the best way to offer members an insurance product. So, should the government decide all doctors and dentists need to hold a regulated policy of insurance for clinical negligence risks, we are confident we will be in a strong position to offer this as a benefit of membership to UK members.”

The consultation closes on 28 February 2019.

*Appropriate clinical negligence cover consultation. Department of Health and Social Care, December 2018.

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