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Average indemnity costs are '£8,000 a year', claims think-tank report

An average GP pays £8,000 per year in indemnity costs, a figure that is helping to drive GPs out of the profession and putting patients at risk, a new report by a centre-right think-tank claims.

Policy strategist and consultant neurologist Dr Paul Goldsmith said the £65 billion NHS liabilities for medico-legal claims are ‘putting patients at risk by driving GPs out of practice’.

In his report for the free market think tank Centre for Policy Studies (founded by Margaret Thatcher and Keith Joseph), he outlined the impact of high indemnity payments which mean some GPs are ‘finding it too expensive to work, particularly those working out of hours’.

The average GP is forking out more than £8,000 per year for indemnity, he found, but the rates are higher for out of hours GPs, who face higher risks. 

Dr Goldsmith said: ‘GPs’ indemnity payments have become so great that some are finding it has become too expensive to work out of hours.’

Doctors are citing the cost and personal jeopardy as factors in taking early retirement or reducing their workload.

‘What is perhaps more surprising is it is also deterring young doctors from entering primary care,’ the report concluded.

‘At a time of major shortages of doctors, this is highly undesirable.’

He described how the situation worsened with the drop in the discount rate announced this February, which influences the level of payouts and ‘leads to a near doubling of awards.’

‘A problem is current GPs are in effect paying for cases which relate to previous years, perhaps for colleagues who have now retired. If these costs are passed through to GPs, they may find them unaffordable and stop work.’

The other conclusions from the report included:

  • The prolonged jeopardy of fitness-to-practise investigations ‘contributes to the high suicide rates among doctors, which is double that of the background population and more broadly high rates of mental health.’
  • The move to end single  GPs ‘is a good thing’, as ‘working in a group rather than isolation is an important aid to quality and safety.’
  • There should be a no fault compensation, which should be paid directly to the responsible body buying future care for the claimant.

Readers' comments (5)

  • that is as a locum 8300 pounds covers for 5 sessions a week with access to patient notes, add ooh cover for 9 sessions goes up to 19,000 pounds a year - my quotes for 2017 - 2018

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  • Just Your Average Joe

    As above - the average cost is just that - covering those who work part time and pay far less, than a full timer, and again far less than those with Special interests and OOH sessions.

    Pointless numbers like that mask the true cost and problems faced by GPs.

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  • Just Your Average Joe

    The lawyer all you can eat buffet of compensation needs to be stopped for compensation claims.

    Like the criminal injuries compensation scheme - which is a no lawyer set up, we need to have a legal cost driven system dismantled.

    However we still should pay people who have had the wrong leg amputated etc given appropriately compensation - which they receive fully - as no cut taken for ambulance chasing lawyers who drag out proceedings to rack up fees.

    With set fees per issue - adjusted by a panel of independent medics/lay people to allow for special circumstances, this would be a fast and much improved and cost effective scheme and could be set up in months.

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  • My only paid work now is doing mental health assessments . For 26 sessions per year I pay nearly £3000 as my low risk activity is classed as OOH activity ching ching.....easy money for provider

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  • Dr Goldsmith, MDOs haven't yet passed on the cost of the change in the discount rate. So far we have only faced the 'usual' inflationary increases of 10-15%.

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