State-Backed Indemnity – Is There Cause For Concern?

State-backed indemnity will now be funded with GP resources, according to a recent announcement at November’s council meeting. In October 2017, former Health Secretary Jeremy Hunt revealed that medical indemnity would only be part-funded by GP budgets, but the government’s plans for indemnity funding have since changed.

For some, this move is hailed to be another nail in the coffin for GP partnerships. For others, state-backed indemnity could be the answer the UK needs to keep more doctors in the profession and help solve the medical indemnity crisis. So what does state-backed indemnity mean for the NHS, and is there cause for concern?

State-backed indemnity: what it means

Medical indemnity is an area of insurance that applies to malpractice in medical professions. It is used in accidents, mistakes and in cases where negligence is proven. If a medical claim is successful, compensation is paid to the patient or claimant thorough indemnity insurance.

It is estimated that the average GP currently pays £8,000 a year for indemnity, taking the profession’s total annual bill to around £300m. What’s more, legal fees have risen by 50% since 2010, according to The BMA. Under this new scheme, indemnity would be paid from general practice budgets as a way to help the government keep doctors in general practice and meet their target of 5,000 more GPs by 2020.

However, council members feel that this new direction shows a lack of support for general practice, with fears of a further financial burden on the NHS, but are their concerns correct?

Dr Sunil Bhanot told GP Online:

“It’s a kick in the teeth for GP partners who will have to pay for the scheme, a shove towards the exit for experienced doctors trying to cope with unsustainable workload pressures, and a naive approach to supporting our workforce in caring for patients.”

There are also concerns about which areas of general practice will be sacrificed to cover the costs of state-backed indemnity – a detail that hasn’t been made clear, despite that we are months away from the plans taking force. Representatives at England’s national LMCs conference are reportedly outraged by the government’s plans, with many stating that general practice simply cannot afford to fund indemnity.

When will state-backed indemnity kick in?

The official start date for state-backed indemnity is 1st April 2019, but the document provided by the DHCS on the state of negotiations imply that the planned start date might be set back.

How much will it cost?

According to recent reports, the government has already put £30m a year into a GP Indemnity Support Scheme since 2016, which is currently being distributed through practices to ease the transition. However, with costs set to rise further before the scheme is rolled out, figures show that the investment will need to have quintupled to bring GP indemnity costs down to a realistic level.

Is state-backed indemnity the answer?

Medical defence organisations have warned the government that the plans for state-backed indemnity will not help tackle rising indemnity costs. As a result, many practitioners are calling for a cap on legal fees to help ease the financial burden, particularly in cases involving low-value medical claims.

If you’re a GP worried about the impact of state-backed indemnity, you may decide to move to an out-of-hours role. Working out of hours has many proven health benefits for doctors, but it can also be advantageous for your career and provide a better quality of life. To find out more, view our jobs page or contact EBPCOOH Recruitment today.