The increasing cost of medico-legal cover is forcing some high earning surgeons to quit their private practice.
The Medical Protection Society has had to hike subscription rates for consultants in private practice by an average of 7.5% this year - more than twice the rate of inflation.
“This reflects our experience of the last year, where we saw an increase in the cost of clinical negligence claims brought against hospital consultants,” said Dr Iain Barclay, MPS deputy medical director.
Neurosurgeons and spinal surgeons, classified as one of the highest risk categories, earning around £100,000 after expenses from their private practice now pay more than £35,000 a year for indemnity.
“Some of them are saying it’s just not worth it. Cover for this group of doctors is so high, not because there are a lot of claims made but because any claims that are made are likely to be catastrophic,” said Barclay.
MPS reviews specialist grouping within their grades every year. This year bariatric surgeons have been moved up a risk category while hand and upper limb surgeons dropped down a group.
The Medical and Defence Union of Scotland has increased its subscription rates on average for juniors by 2.33% and 3.32% for consultants.
Medical Defence Union rates have gone up by varying amounts. A neurosurgeon earning between £10,000 and £15,000 from private practice has not had any rise in their subscription fee for 2010, but those earning between £125,000 and £175,000 are paying 6% more. An ophthalmologist not doing refractive surgery and earning between £125,000 and £175,000 is paying 5% more, but a cardiologist or an anaesthetist earning the same amount is paying only 0.5% more.
Dr James Armstrong, the MDU’s head of underwriting, said: “Despite the rate of claims inflation remaining consistently above RPI, due to factors such as rising claimants’ solicitor costs and the increasing cost of providing long term care, sound financial management has enabled the MDU to limit any increase in subscriptions.”
According to the medical accountancy firm Stanbridge Associates some consultants are suffering additional pain from a fall in their private practice earnings.
Vanessa Sanders, a Stanbridge director, said earnings from cosmetic surgery and laser eye treatment were down about 10%, probably as a result of reduced demand during the recession.
But some other groups are doing well - orthopaedic surgeons who have been picking up extra private work from PCTs contracting out NHS work, such as hip replacement operations, have enjoyed an increased income of between 7 to 12% in some parts of the country.
Some dermatologists, who are in one of the lowest risk groups for medico-legal cover, have been enjoying a rise in private practice income of up 12-22%.
Tags: Insurance, Private practice
There are many injustices in the defence societies’ fee scale lists. How come for example that dermatologists remain in “one of the lowest risk groups” when they’re doing more and more operating? The list of risk categories needs to be replaced by fees based on actual performance of clinicians. For too long good clinicians have subsidised the risk of the less good, and the appearance of commercial medical defence insurers in this market-place is going to blow the whole cosy arrangement out of the water. The pity is that the traditional defence societies are having to react on the back foot rather than to have seen this coming and made the changes necessary to bring justice to the situation.