Compensation rule changes and their significance for GPs

by Alan Stout

Higher medical indemnity insurance rates threaten to unsettle GPs and possibly affect retention and recruitment

Location: Northern Ireland
Last reviewed: 27 May 2021
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The Damages (Return on Investment) Bill sounds like a very dry subject, and I am more used to giving evidence to the health committee, but given the huge implications this legislation could have on general practice it was important that I spoke to the justice committee today to reinforce the impact it will have on GPs.

Firstly, it is important to put on our record our support for the purpose of this bill. We fully support the principle of 100% compensation for claimants. It is the impact on general practice that we are concerned about.

General practitioners in Northern Ireland are the only doctors within the health and social care system who must provide and pay for their own indemnity insurance. The cost of this varies depending on a number of factors but can run to £12,000 per annum for a full-time equivalent GP.

The cost of this indemnity insurance is, in part, dictated by the discount rate. When the rate is lower, indemnity costs are higher. It is clear that from both this bill, and the indemnity rate have the potential to impact on indemnity costs for general practitioners.

When the discount rate was lowered in England and Wales it was forecast that indemnity insurance rates may double or triple. Some GP colleagues were quoted increases from around £13,000 per annum to over £30,000 per annum.

This forecast increase in England and Wales sparked the immediate introduction of a state backed indemnity scheme which covers much of the cost of GP indemnity. This was supposed to be a UK wide solution, but we had no minister in place at the time to introduce it here.

We have received welcome reassurances from some medical defence organisations that increases of this magnitude will not be the case immediately in Northern Ireland as they have been able to plan for a change to the discount rate here based on changes elsewhere. However, this cannot be guaranteed on a long-term basis.

Particularly in an instance where we may inadvertently end up with the interim discount rate for a longer than expected period of time.

Should we see increases to the cost of medical indemnity insurance it is inevitable that GPs will reduce their workload, or even leave the workforce altogether. And this is at a time when we cannot afford to lose GPs as it would bring more pressure into an already hugely difficult and stressful situation.

We fear that costs of this magnitude are also a significant reason why it would become difficult to recruit doctors in training into general practice, or indeed recruit general practitioners to Northern Ireland from other parts of the UK.

There is an additional risk that as a result of the change to the discount rate medical defence organisations may eventually be faced with no choice but to call in debt to cover historical liabilities. This would undoubtedly result in the closure and bankrupting of practices and an inevitable reduction in service to patients.

I should also note the impact of claims on GP time. Requests for notes and subject access requests often accompany claims. Each of these is a significant undertaking for GPs, taking time away from direct patient care.

Aside from the workload associated with any claims there is also additional pressure on an individual doctor who faces these claims. With a lower discount rate, we would expect the number of claims to rise and therefore this pressure and workload will also rise.

I know that the Department of Justice cannot take the impact of the discount rate on indemnity insurance and general practice into their reasoning for the methodology chosen to strike the rate.

However, we believe it is essential the Department of Health and Justice work together to ensure the effects of the change to the discount rate are not crippling to general practice and the wider health service in Northern Ireland.

Our preference is the establishment of compensation scheme for increased GP indemnity costs. A scheme such as this would mitigate the impact on GPs and general practice and allow continued practice on the same basis as general practice currently operates.

It is also very important to general practice that this legislation is passed in this Assembly mandate, we appreciate the tight timescales and the workload of the committee but should this legislation not pass we may face the consequences of the lower interim rate for some time.

Alan Stout is BMA Northern Ireland GPs committee chair