MEMBERS will have seen reports about the impact of the change to the personal injury discount rate on indemnity subscriptions. Let me bring you up-to-date with developments.
The UK Government lowered the personal injury discount rate from 2.5 per cent to minus 0.75 per cent in February. The Scottish Government followed suit in the following month. The effect is to increase the amount of damages paid to claimants in cases involving loss of future employment and long-term care costs, in some cases significantly. The Government recognised the problems caused to the NHS by earmarking an additional £5.9 billion in the March budget to meet the consequences and indicated that "appropriate funding" would be available to manage the consequences for GP indemnity. The Ministry of Justice also launched a consultation about finding a better system to set the rate in future.
Since then, MDDUS has been in the forefront of the debate to put some rationality into the system. We have made clear to both UK and Scottish ministers that we may well judicially review the decision unless the current consultation on a new system reaches a speedy and satisfactory outcome. We have underlined the need for a comprehensive set of legal reforms to limit the impact of claims inflation, whilst ensuring that legitimate claimants are properly and speedily recompensed. In the short-term, we have put proposals to Government for ensuring that subscriptions do not need to rise further because of the discount rate change, whilst ensuring that locum and salaried GPs' positions are also protected.
The General Election has added frustrating delay to resolving these issues. But, while we continue to press the incoming administration hard for clarity, we also want to provide the maximum certainty that we can for members. So the renewal prices on our website are guaranteed at present for all subscriptions ending up to 31 July 2018. We can give you this guarantee because of the financial strength of the MDDUS and the agile nature of our service.
The discount rate change is an unwelcome shock, but it does not break the model of profession-owned mutual discretionary indemnity. Neither anything in the market from commercial insurers nor crown indemnity matches this model which ensures that doctors and dentists receive comprehensive, responsive 24/7 support covering the full range of medico-legal, regulatory, disciplinary, inquest and FAI related matters, as well as a full claims service.
We will keep you up to date with developments.
Chris Kenny is CEO of MDDUS
This page was correct at the time of publication. Any guidance is intended as general guidance for members only. If you are a member and need specific advice relating to your own circumstances, please contact one of our advisers.