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Is your sickness cover spot on?

Dr Peter Saul explains why new contract changes mean you should re-examine the situation carefully

In the new GMS world the global sum is king. Almost all of GPs' previous fees and allowances have been rolled up into this figure and the old payments made during sickness are no exception. Inquiries to PCOs about payments for doctors off sick are now likely to draw a blank look.

Under the old rules a payment of up to £850 a week was available for up to six months and then half of this for a further six months depending on list size and number of doctors in the practice. The complexity of the rules governing the amount available discouraged most practices from taking account of the payment when planning for sickness management.

Nevertheless, now it has gone it's probably an opportune time for colleagues to consider this tricky subject and decide whether their insurance cover, if any, is up to current conditions.

There are three main questions to consider when deciding if cover is needed and what it should include.

First, how could the practice handle a staff absence for a few weeks? Do you have sufficient flexibility to cope, and if so for how long? This is important because when taking out a policy you can decide how soon it comes into effect – earlier being more expensive.

Next, consider the level of cover. This should be based on the expected cost of a locum.

Third, should insurance be organised by the practice or personally? And is permanent health insurance or locum insurance required?

The advantage of cover organised by the practice is that this can be linked to the terms of the practice agreement. Here the practice can carry on paying the absent doctor in the knowledge that after the initial period all its costs will be reimbursed in line with the levels and conditions specified in the agreement. Cover should not have to extend beyond a year or so because if the sick partner has not returned by then, they are likely to qualify for ill-health retirement. Discounts are usually available when a practice purchases cover for all its doctors.

Locum insurance is designed to meet the actual costs of employing a locum. It can't be used for anything else, and if a locum is not employed then no claim can be made. Premiums are tax deductible as a legitimate business expense.

Permanent health insurance pays out when the individual is off work ill, and the money can be used for any purpose and doesn't depend on employing a locum. Premiums are not tax deductible but benefits are tax free.

As with any insurance it pays to consult your accountant and seek advice from a good financial adviser. To get a good idea of a 'ball park' figure, a 45-year-old male doctor in good health who is a non-smoker would pay £84 reducing to £50 monthly after tax deduction for cover of £1,600 per week starting after 13 weeks' absence and payable to age 60.

Under the new GMS contract practice staff such as nurses and managers are playing an increasingly important part. When considering locum insurance the strategy of including these key colleagues should be considered, for as with GPs, any costs of sickness have to be covered from the global sum.

With the recent contract changes, now is a good time to re-examine the practice strategy for dealing with sickness among all staff. Work out how you could cover and for how long. Decide the level and type of insurance needed.

Of course, often the hardest part of dealing with staff absence is finding a reliable stand-in whether GP or practice nurse, and no insurance can guarantee this.

Peter Saul is a GP in Rhos, near Wrexham

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