Building a strong defence

The 2017/18 GP contract promises to provide practices with a share of £30m worth of funding to cover inflationary rises in indemnity costs. The recent change in the discount rate threatens further increases in fees. What will this mean for GPs and medical defence organisations? What needs to be done to ease the cost pressures on GPs and the NHS going forward? David Sturgeon, director of development at mutual defence organisation (MDO) MDDUS provides some answers

MDDUS shares the concern of doctors about the rising cost of indemnity as a result of the cost pressures of the growing numbers of claims and increasingly generous awards.

Government support and investment for GPs can only improve patient care and reduce the workload and stress on general practice. However, while greater resources and new ways of working will reduce risk and help address rising number of complaints and claims, more needs to be done on the root causes.

We welcome the additional funding for GPs to help with indemnity costs and the fact that both the government and the Department of Health have found the indemnity market to be efficient and competitive. The additional £30m paid to practices needs to be distributed to both salaried and locum GPs to compensate for their fee increases in 2017/18.

MDOs are not-for-profit financial mutuals, wholly-owned by their medical and dental members. As such, the subscription rates we charge have to reflect the best actuarial estimate of the likely liabilities which we face. These continue to rise because of the higher number of claims and higher costs associated with them.

We have been forced to increase subscriptions to reflect a growing number of claims and increasingly generous awards made to claimants by the courts, as well as increased legal costs – a key area currently under consultation on which we are urging government to act.

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Implementing a fair system

We have been vocal in our support of early implementation of a fair system for resolving clinical negligence claims so that those wrongly damaged get timely, proper and just compensation.

Money expended in compensating for clinical accidents should, as far as possible, find its way to the injured patient and not disproportionately to the lawyers supporting those patients’ claims. We strongly support the introduction of a fixed recoverable cost scheme, especially for lower value claims.

The Lord Chancellor’s decision to change the discount rate from 2.5% to -0.75% will add further financial strain on the NHS. The discount rate change was based on a seriously out-of-date consultation and much-changed economic circumstances. The fact that this is open to consultation so soon after the change was announced merely underlines how short-sighted it was to reset the rate without resolving the wider issues.

The promise of ‘appropriate funding’ to reduce the impact, although welcome, is as yet undefined.

Furthermore, awards continue to be calculated on the basis of the costs of private sector care, when all the evidence shows that those who receive damages, quite rightly, use excellent and readily accessible NHS services where they can do so.

Legislation is needed on these issues urgently and we continue to work together with NHS England and the Department of Health as we seek solutions to common problems.

We welcome the measures to relieve immediate pressures. It is now vital to address causes, not just symptoms. So we urge the government to make rapid headway on the tort reform, cost capping and more transparent and broadly-based tests for setting the discount rate.

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