Exclusive The Department of Health is reviewing a rise in GP indemnity reimbursement amid warnings that fees for GPs are becoming ‘unaffordable’.
A DH minister has said this comes as the discount rate reduction introduced in March has ‘significantly increased the cost of claims’.
Medical defence organisations estimate the Government’s decision to reduce the discount rate applied to personal injury claims from 2.5% to -0.75% will result in a steep rise in payouts and this will filter down to indemnity costs.
As it stands, the DH has set aside £60m to compensate GPs for indemnity cost hikes this year and next, but the department has acknowledged this will not be sufficient following the discount rate reduction.
Health minister Philip Dunne said in response to a written question that ‘the cost of indemnity to GPs is already recognised as a business expense, and reflected in the sums received by GP practices via the GP contract’.
But he went onto admit that ‘the change in the personal injury discount rate announced… in February 2017’ had ‘significantly increased the cost of claims’.
He said: ‘The Department is working closely with GPs and medical defence organisations to ensure that appropriate funding is available to meet additional costs to GPs, recognising the crucial role they play in the delivery of NHS care.’
The DH declined to comment further but acting BMA GP Committee chair Dr Richard Vautrey said a review, ‘led by DH’, was working to determine the impact.
He added: ‘This is consistent with what we’ve previously stated in that we are in active discussions with all parties about what the impact of the discount rate will be for GPs so we can ensure a sustainable system in the coming months and years ahead.
‘The £30m was to cover the expected indemnity inflation, not the much bigger changes that will come as a result of the discount rate change.’
The news comes as Pulse revealed that ‘all options’, including state-funded indemnity, are now ‘on the table’, amid growing concerns from the Department of Health and NHS England about the impact rising subscriptions are having on the recruitment and retention of GPs.
But the MDU warned that unless an urgent solution is reached, GP members will be hit by higher indemnity costs, rendering the profession ‘unaffordable’.
The MDU told Pulse it has been ‘discussing this problem’ with the DH since early December 2016 and ‘yet we are nearly in August 2017 and there is no solution’.
Dr Christine Tomkins, MDU chief executive, said that the discount rate changes would ‘double and could even treble settlement costs in high value claims’.
She added: ‘Although the MDU has not passed on these costs to GPs yet, pending the promised funding to GPs to meet the costs of this catastrophic and unprecedented cut in the discount rate, this cannot continue…
‘What doesn’t seem to be publicly appreciated is that without immediate government action this change will impede every citizen’s access to healthcare by making general practice an unaffordable career choice for doctors.
‘The MDU is asking the Government to make good on its promise to GPs and to do it now.’
GPs reach end of their tether on indemnity cost hikes
A survey by the MDU has shown a third of GPs are thinking of leaving the profession or retiring because they cannot afford the increased cost of indemnity. Nine out of ten GPs questioned in the survey said they would like to be covered under an NHS indemnity scheme.
Meanwhile, a survey by MPS showed that if the cost of clinical negligence claims continues to increase at the same rate as currently, nine in ten health professionals think this will ‘threaten the sustainability of the NHS’.
Defence organisations have called for legal reforms to bring down the cost of indemnity, including capping payouts and lawyer fees. To date the DH has only formally consulted on fixing legal fees in low-value negligence cases, although it has yet to respond to that review.
Meanwhile, grassroots GPs voted in May to make GPC policy to push for full reimbursement of GP indemnity costs, rather than just covering inflation.