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Practices to be given indemnity funding directly to pass on 'appropriately'

Practices will be paid directly for rising indemnity costs based on the size of their lists, and will be expected to pass on an ‘appropriate share’ of the funding to support all GPs, NHS England has said.

It has released a report on the £60m GP Indemnity Support scheme, which was announced last week and will launch in April 2017 to reimburse practices for this year’s average increase in indemnity costs.

The report says that the payments will be made direct to practices, based on their unweighted list size and not on the individual practice’s indemnity costs.

It comes after sessional GPs raised concerns that the costs of their indemnity would not be met, and NHS England have clarified it will be up to practices to pass the funding on.

NHS England’s methodology for determining the average inflationary increase has not yet been agreed, but the report says indemnity providers estimate the annual increase at 10% and this is likely to be most accurate.

The review includes a survey, launched in June, that received 4,500 responses and showed the average spend on indemnity had risen from £5,200 in 2010 to £7,900 in 2016 – a 7% increase annually.

However it adds this likely ‘understates real inflation’ because GPs have reduced the average number of sessions they work in this period.

A Pulse survey of more than 900 GPs earlier this year found the average reported indemnity increase last year was 26%, and some individuals have been quoted as much as £30,000 for annual indemnity.

The review states: ‘By objective measures the quality and safety of care provided by GPs has never been higher… [the] rises in cost experienced by GPs is related to the increases in damages being awarded (both volume and cost), particularly for high-value claims.’

It adds: ‘By basing payments for practices on the list size, the scheme will include provision for the additional indemnity premiums faced by all GPs at the practice as well as partners.

‘As such, GP practices will be expected to provide an appropriate share of their payment to their salaried GPs and locum GPs.’

Following the announcement last week, the Department of Health said it will now ‘begin an urgent piece of work’ to address the root causes of clinical indemnity increases, and continue work to cap the costs legal firms can recover in negligence cases.

The chief executive of the National Association of Sessional GPs, Dr Richard Fieldhouse, said the simplest way would be to pay the indemnity direct to locums or the defence organisations – which are non-profit mutuals – and save on bureaucracy.

He told Pulse: ‘It would be really nice for the 17,000 locums out there, not to have to individually negotiate and barter with practices about getting their fair share of that rise, because otherwise locums are going to be charging extra for it. They’ll be adding it into their invoices, and that’s going to increase the employers contributions to the NHS superannuation scheme.’

Meanwhile, the GPC wrote to GPs this weekend saying that the scheme was a significant recognition of the impact of spiralling indemnity, but add this it only a first step, with a ‘definitive solution’ needed long-term.

GPC chair Dr Chaand Nagpaul’s newsletter to the professions states: ‘While this is an important and significant recognition of the impact of rising GP indemnity fees, we see this as only a first step.

‘There is a need for a definitive solution to rocketing indemnity costs, which are also mentioned in NHS England’s proposals.’

Dr Matthew Lee, MDU director of professional services, said: ’We welcome the arrangements being put in place to support GPs but the fact that the Department of Health has needed to step in to protect them from rises in indemnity costs, shows the need for reform of personal injury law.

‘The only realistic solution is to stem the frequency and cost of negligence claims to ensure NHS money is spent on front-line services instead of litigation.’

Rising indemnity fees

GPs on call - OOH - out of hours - urgent care - online

GPs on call - OOH - out of hours - urgent care - online

In January, Pulse revealed that indemnity fees were ‘spiralling out of control’, rising by an average of 25.5% in 2015, according to an analysis of responses from over 900 UK GPs.

This was particularly acute for out-of-hours doctors, with one GP claiming that they had experienced a £30,000 increase in their costs this year.

As a result, NHS England implemented a £2m temporary scheme in which GPs signing up for extra out-of-hours shifts this winter were be able to have their medical indemnity costs covered, which 550 GPs used, totalling 14,264 extra shifts.

But Pulse reported it remained a problem, with GPs in the English borders crossing over to work exclusively in Scotland after identifying that indemnity costs are one third of what they would pay working full time in England.

Last week, NHS England announced it would run the winter indemnity scheme again, but also committed £60m to cover the cost of indemnity inflation for two years from April 2017.



Readers' comments (22)

  • Mine went up by 15% last year (7 session principal)

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  • "Expected to pass on" - Hmmm! I would bet that, in some cases, absolutely NONE is passed on. Just another mechanism to give GPs more money without calling it a "pay rise". Well done!

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  • Peter Swinyard

    Thank you cynical pharmacist. I am sure that added to the debate. The main problem with this is that it penalises practices which are well staffed with doctors as the indemnity payments are per doctor and the reimbursement is per patient. The only positive that I can glean is that the list size used is not Carr-Hilled.
    In my practice we pay the indemnity for our salaried colleagues for the days they work with us. Pay rise for doctors? pah!!!

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  • I know, why don't we just nationalise the bankrupt MDO insurance schemes - a bit like banking, and offer crown indemnity to GPs all round. The money we all save on MDO fees can be used to offset the massive losses we're experiencing with workload dump.

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  • Basing this on list size in incorrect - it should be based on Doctors in Situ -

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  • Dear Pharmacist,

    Don't worry. They WILL call it a pay rise, when it is anything but.

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  • A very small step in right direction.But,too little too late!

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  • .... the Department of Health said it will now ‘begin an urgent piece of work’ to address the root causes of clinical indemnity increases, ....

    erm, I can save them some money there, the 'root' cause is parasitic, greedy lawyers.

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  • So as a locum I will have to bill practices directly for indemnity fee rebate? Great. Can see that bring an easy sell

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