The Department of Health in England and the Welsh Government are discussing with medical defence organisations the introduction of a state-backed indemnity scheme for GPs in England and Wales.
The rising cost of indemnity has been a major issue for GPs. MDDUS believes that the reasons for this are down to Government’s failure to take decisive action to reduce the increasing number and value of claims and the addition of significant new cost by the misguided lowering of the discount rate to -0.75%. Read more about the discount rate here
The initial idea of a state-backed scheme may be attractive but we need to ensure any such scheme is future-proofed for inflation and doesn’t just bring members back to the position we are in now but with no MDO backing.
As a not-for-profit-mutual funded by our own members with no shareholders to pay, we have been able to keep our costs as low as we can, ensuring adequate indemnity for all our claims: historical, current and future.
A state-backed scheme will not cover you for non-NHS work, representation at inquests, GMC hearings and disciplinary investigations and will also not include advice and support – something highly prized by MDDUS members.
It will be a voluntary scheme but will have a cost attached to it. It is state backed, not state funded.
What do you need to know?
MDDUS is seeking detailed assurances from the Government over the state-backed scheme. Jeremy Hunt’s announcement raised more questions than it answered. The Government must spell out the details of what is involved and commit to tackling the real issues behind rising indemnity costs before GPs can make a decision on the scheme.
GPs need detailed and specific answers on a wide range of issues including the cost of the scheme, how it will be managed and ensuring GPs have a choice with fair competition. GPs have the right to expect such detailed assurances – and the option of opting out at no financial detriment if answers are inadequate.
The Government’s failure to reform the law of tort and cap costs that lawyers are taking from the NHS and GPs has been the main driver in rising indemnity costs. That’s outside the control of medical defence organisations and a state-backed scheme doesn’t address that. Health expenditure generally and GP remuneration in particular will continue to be squeezed because of this failure.
Click here to read about the assurances we are seeking on your behalf.
Read the small print
Another medical defence organisation has announced plans to introduce a "claims paid" scheme from November 2017. Whilst this may appear an attractive option, there are major pitfalls that GPs must be aware of. Indeed, the Department of Health has sounded a note of caution about this type of product which "only covers claims which are reported and settled during the period of cover", meaning GPs would have to pay for costly run-off cover. Click here to read our latest views on the issue.
What are we doing?
Jeremy Hunt has indicated that the introduction of a state-backed scheme will not take place until April 2019 so there is a lot to plan for and discuss before then.
MDDUS is in consultation with the Department of Health but also with the devolved administrations in Scotland, Wales and Northern Ireland to discuss the possible way ahead. We are speaking with Government officials and with the politicians and decision makers to ensure any scheme is best for our members and patients: past, present and future. The claims experience of GPs differs very markedly across the different parts of the UK and we do not see anything like the same strength of case for action in Scotland and Northern Ireland as in England and Wales.
We will continue to lobby and engage with key influencers about the scheme and ensure that the views of members and patients are at the forefront of the decision-making process.
Find out more
We have worked hard to answer as many questions as we can about the scheme and what we know about it. You can click below to read our FAQs.
If you have a question that is not answered here then please contact us on firstname.lastname@example.org where we will give you a personal response. We will update our FAQs with any new and relevant questions posed.
To find out more about membership with MDDUS visit our Join page.
Click for answers to commonly asked questions regarding the proposed state-backed indemnity scheme
Why is Government considering this?
They are concerned about rising indemnity costs and threats to GP recruitment and retention. We think they are missing the key issue in not tackling the causes of the number and value of claims and settlements and are in active discussions to put that point across.
Will it cover the whole of the UK?It only applies to England and Wales. We understand that Scotland and Northern Ireland are now considering their position, but the issues are very different and, in MDDUS’ view, do not call for a similar response. Our rates in Scotland are significantly less than England and, in fact, lower than in 2011. We have either met or are due to meet all of the devolved administrations to discuss this.
Is this down to MDDUS poorly managing business?
Not at all. Our annual reports over the last decade show that not to be the case in the slightest. We have grown strongly in the past decade and are on a sound financial footing.
How has the Government come to see this as a solution?
There have been a range of discussions between Government and MDOs since the decision to decrease the personal injury discount rate in February 2017. We believe other MDOs may have been pushing for a state-backed indemnity scheme.
Does this cover dentists? Does MDDUS think it should?
No and no. The market for dental indemnity is very different and fees are lower than for GPs. MDDUS offers particularly competitive subscription rates, which explains its recent rapid growth in England which we expect to continue.
Will it be claims only?
That is our understanding, but we await definitive details.
Will it be occurrence or claims-made?It will be occurrence-based.
What happens to historic liabilities, i.e past claims, claims yet to arise?
This is under discussion with Government. The MDDUS Board will take its final decision in the best interest of members. Members can be assured that we are fully funded and can meet both our known liabilities and our best estimate of the unknown ones.
What happens to a current claim?
We are working on the assumption that claims will continue to be managed where they currently lie. We will let you know quickly if this changes.
What happens to my existing membership?
All GPs need the advisory and regulatory expertise of MDDUS which the new scheme will not provide. And, as the new scheme is voluntary, we’ve made clear to Government that GPs should keep a choice and not be either bullied or bribed into it. GPs will continue to need cover for non-NHS work and we will continue to provide this.
What about regulatory matters? How will a regulatory matter that then progresses into a claim be handled as there is obviously considerable crossover?
It’s vital that there are strong arrangements in place to handle this situation. That’s on our agenda with Government.
Will you still provide general support and advice on day-to-day complaints and issues?
Yes. And disciplinary matters and coroner's inquests etc. There are a huge range of areas where GPs will not get support from the new scheme and will need supplementary expert help. We will still be there for you.
Do I need to resign from MDDUS as a member?
Absolutely not. There’s a real risk that you will find yourself in breach of your GMC obligation to have adequate and appropriate indemnity or insurance if you do and keep practising.
When will it all happen?
We don’t know. We’re emphasising to Government that this must be done right, not quick. We expect a minimum implementation time of 12 to 18 months from when the decision is made.
Will I get a refund for any unexpired term of membership?
We’ll treat our members fairly, but can’t speculate about precise arrangements at this very early stage.
What decisions will we need to make and by when?
Again, we can’t speculate about what choices will be available and when until we see more detail. What you can be assured of is that MDDUS remains the most responsive, professional and best value MDO in the UK.
Will I receive any financial benefit/pay off from this development (similar to that where a company demutualised)?
No. MDDUS is here for the long-term. We’re not demutualising and we’ll use our strong capital base to develop more services for members and give them cast-iron certainty that all our liabilities can be met.
Will my practice manager/staff/I still be able to access the training resources from MDDUS?
Should your practice be a Discount Practice Scheme then yes. We are investigating how to strengthen our offering to members further.
What about my staff who are covered by a DPS? Are they covered by the new scheme?
We understand that this will be the case but there are no specific details from Government.
Will my claims/advice history be transferred over to the new scheme?
This has not yet been discussed with Government.
Where it is a mixed practice, with MDDUS, MDU and MPS members to ensure independent advice/no conflict of interests – how will this now be handled?
We have always said that practices get best value from all staff belonging to MDDUS. We understand the new scheme will focus on entities, such as partnerships, and not individual membership.
Do we recommend members join the new scheme?
It is far too early to say. What we can say is that the Board’s decision will be driven by what is in the interests of members as practising professionals, not by the interests of the company.
Is it a good deal?
Until we have the assurances set out in the press release, it is too early to say. Members will appreciate that we are not authorised to give formal financial advice on the new offer.
You say we as members want assurances. What and why?
Because our members deserve choice and certainty rather than being forced to make a decision with no context. Until there are clear details about how choice is protected, how the scheme will be priced – and continue to be priced - in a sustainable way, the personal support available to them and its impact on the wider remuneration system, it’s not possible to make an informed choice.
Will cases or assets be transferred?
Regarding the transfer of cases, this will be discussed in due course, but we would hope not. Regarding assets, this will also be a matter of negotiation. We have made clear to Government that it must treat all MDOs equally in this process.
How will MDDUS come to a decision?
The Board will come to a view when it has sufficient information on the nature of the service available to members, the financial arrangements for the new scheme and the proposals for asset transfer. It will not be bounced into making a decision – and GPs should not let themselves be bounced either.