The UK government’s consultation on appropriate clinical negligence cover closed in February, with recommendations for potential next steps. The idea is to protect healthcare professionals and patients with appropriate indemnity cover.
According to a survey by the Department of Health and Social Care, more than half of GPs, (or practice managers who responded on their behalf), are unsure of what type of medical indemnity cover they hold (i.e. claims-made, claims-paid, or claims-occurring).
Some regulated healthcare professionals are also unaware of the difference between discretionary and contractual cover.
The government’s consultation on clinical negligence cover
The review of medical and dental indemnity cover sought to find out the best way to ensure that regulated healthcare professionals have sufficient protection in the case of a negligence claim, have greater clarity as to terms of their cover, and so that patients have access to appropriate compensation, and confidence in that access, in the event of a claim.
The two options are:
- leave arrangements as they are
- change legislation to ensure that all regulated healthcare professionals in the UK not covered by a state-backed indemnity scheme hold appropriate clinical negligence cover that is subject to appropriate supervision, in the case of UK insurers, by the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA).
What you need to know
Claims made and claims occurrence
Occurrence based cover means that you are covered whenever the claim is made (not just during the year of when the insurance policy is live). This type of cover is provided by All Med Pro. However, many insurers only provide cover on a claims made basis. This means that you are only covered for claims during the period that your policy is live.
As often claims are made more than a year after they have occurred, this type of policy only provides a certain level of protection. In these instances, you need to purchase run-off cover, even into retirement or at a change in career, to remain fully protected.
Discretionary and contractual
A discretionary medical indemnity policy is provided on the basis of ‘discretion’, i.e. the provider does not have to pay on a claim if they choose not to.
While legitimate claims are rarely rejected, it does happen, and therefore, it does reduce your level of protection in the event of a negligence claim against you. A contractual policy, on the other hand, is provided by a regulated insurer who is obliged to fulfil the contract in the event of a legitimate claim.
In April 2019, the UK government introduced a state-backed indemnity scheme for primary NHS medical service providers, including practice staff, salaried and locum GPs, out of hours, practice pharmacists, nurses and healthcare assistants.
The scheme provides a level of indemnity protection for negligence claims, for scenarios like General Medical Council (GMC) proceedings and court proceedings, among other things.
This cover is for NHS medical staff, and therefore, does not cover dentists or private practice professionals. It also does not currently make a provision for claims that occurred prior to April, and therefore, run-off cover is required for full protection.
Medical indemnity consultation recommendations
The government’s consultation has made some recommendations about its preferred route forward, which are now being considered. The recommendation is for option two, to make changes to existing legislation. Their preferred solution is to make amendments to healthcare professional standards legislation to ensure regulated healthcare professionals have contractual cover if they are not covered by the state-backed NHS indemnity scheme.
This could be combined with a change to financial legislation, where any provider of clinical negligence cover would be required to be authorised by the PRA and FCA – thus putting the onus on providers to offer appropriate products.
If this option, or combination of options are taken forward, it would mean that healthcare professionals in the UK who are not covered by a state-backed scheme would have to purchase contractual cover by an insurance provider, rather than discretionary cover by a defence union.
Make sure that your broker fully explains what type of policy you have
One benefit of choosing contractual cover is that you can work with a broker who can help you select the right product for you. With so many professionals not understanding what type of cover they have, it is imperative that you work with a reputable broker who can make sure that you are aware of the benefits and limitations of any insurance policy that you choose.