MDDUS urges early reform to reduce cost pressure on indemnity rates

MDDUS has urged the government to work toward early implementation of measures to reduce legal costs in clinical negligence cases.

MDDUS chief executive Chris Kenny has written to Minister for NHS Productivity Lord Prior of Brampton who is responsible for taking the next steps following the government’s recent review of GP indemnity.

In the letter, Kenny urges the government to push through plans to reduce legal costs in clinical negligence claims as soon as possible.

"We welcome the fact that in the recently published GP Indemnity Review, the government and NHS England found the indemnity market to be competitive and that the price increases our members face are fundamentally driven by factors beyond our own control," says Kenny.

"The absence of effective controls on the amount of costs which can be recovered in negligence cases is a key driver and substantive action is required on the underlying causes of these increases.

"The scope for savings for both medical defence organisations and the NHSLA are considerable, especially for lower value claims. We all have many examples of where the amount paid in legal costs is significantly greater than the compensation payments made to the patient.

"It is for that reason that the idea of a cap to overcome these perverse incentives of the current system is so attractive. Not only will it ensure far tighter management of costs at the level of the individual case, but it will have the right incentive effects in ensuring that only the strongest cases are selected and prepared in the most cost-effective manner."

Meanwhile, figures from the forthcoming MDDUS 2015 annual report reveal a continuing growing trend in compensation claims and litigation. Our figures show the number of claims for clinical negligence against members across the UK rose by 22 per cent compared to the previous year. This included a 16.4 per cent rise in claims notified against GPs and a 20.6 per cent increase in claims against hospital doctors.

"It is a continuing challenge to set subscription rates that are fair to members whilst at the same time ensuring that members have the necessary financial reassurance from MDDUS of its ability to meet the costs of claims and non-claims in the future," says Kenny.

"We have done our best to restrain costs to reduce the pressure on rates and, in 2016, to price support for out-of-hours working in order to make sure that the right incentives are in place to protect professionals doing this vital work."