GP Indemnity Costs: England — [Mr Andrew Turner in the Chair]

– in Westminster Hall at 11:21 am on 15th March 2017.

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[Mr Andrew Turner in the Chair]

Photo of Alex Chalk Alex Chalk Conservative, Cheltenham 2:30 pm, 15th March 2017

I beg to move,

That this House
has considered the cost of GP indemnity in England.

May I say at the outset what a pleasure it is to serve under your chairmanship, Mr Turner? I thank hon. Members for attending the debate. It is disappointing that it clashes with an important speech by my right hon. Friend the Chancellor of the Exchequer, but I know that several hon. Members from across the House will be interested in the matters discussed here.

General practitioners are the foundation stone of strong primary care and, in turn, strong primary care underpins a strong NHS. To put it another way, if GPs sneeze, the entire NHS catches a cold. That is because, first, GPs keep the community healthier, with early interventions to prevent conditions from getting out of control and requiring resource-intensive hospitalisation, and, secondly, they divert patients who might otherwise present at an accident and emergency department towards pathways more suitable for them and, indeed, the NHS.

GPs are doing an enormous amount to adjust to the changing health needs of our country. I accept that these are now familiar statistics, but they bear repetition. In our country of just 64 million people, there are now 1 million more people aged over 65 compared with 2010, and there are more than 300,000 people aged over 80. Those are stark statistics. It is fantastic news, of course, but it presents great challenges, and many of those challenges fall on GPs.

I pay tribute to the GPs in my constituency from Yorkleigh surgery, Overton Park surgery, Berkeley Place surgery, St Paul’s medical centre and so many others, who do a brilliant job. Most GPs I meet enjoy their job—indeed, the overwhelming majority do—despite its great demands, but I do feel, and I suspect many of them do, too, that they can be unfairly criticised. I trust that we can all take this opportunity to express our gratitude and admiration for the vital work that GPs do. To put it bluntly, they keep the show on the road. Without their professionalism and good will, the system as a whole would fall over. They are vital.

When I was elected to this place, I was concerned that the proportion of the overall health spend going on primary care appeared to have shrunk. All the evidence suggested to me that that needed to change, so I warmly welcome the 14% increase that the Government have announced in funding for general practice. It is rising from £9.5 billion in 2015-16 to £12 billion by 2020-21, as announced in the “General Practice Forward View”. Of course we all want there to be more money, but that additional funding and the additional £2 billion for social care announced by the Chancellor in the Budget are manifestly steps in the right direction.

Given that background, what is this specific debate all about? I have called the debate because I am concerned about an issue that has the potential to restrict the vital pipeline of new GPs. I am referring to GP indemnity—the insurance premiums that GPs are obliged to pay, from their own pockets, before they are permitted to practise. The bottom line is that those premiums are rising at such a rate that they are discouraging GPs from taking on certain forms of work, including out-of-hours care, and are even discouraging some medical students from entering primary care in the first place.

It is important to understand that GPs are in a special category of medical professionals in this respect, because doctors working for NHS bodies, such as hospital trusts, are covered by the clinical negligence scheme for trusts, which is administered by the NHS Litigation Authority; there are equivalent organisations in Scotland, Northern Ireland and Wales.

This issue does not emerge from a vacuum; it has been brewing for a while. In its 2014 annual report, the Medical Defence Union published data suggesting that indemnity inflation is about 10% per annum. More recently, a survey carried out by NHS England last year as part of the GP indemnity review showed that between 2010 and 2016 there was an increase in the average indemnity payment for in-hours or scheduled care of more than 50%. What does that mean in real terms—in pounds, shillings and pence? The average payment for in-hours or scheduled care cover in 2010 was £5,200. That had risen to £7,900 by 2016—an increase of more than 50%. Ninety-five per cent. of GPs surveyed have experienced a rise in indemnity costs, and 88% pay them from their own pockets.

The inflation for out-of-hours sessions is, according to the review, likely to be higher still. It is thought to be about 20% per annum, although the position on out-of-hours care is harder to establish because of data availability. Of the several thousand GPs surveyed, 72% claimed that the rise in their indemnity costs had deterred them from taking on out-of-hours sessions. Only 21% agreed with the statement

“Indemnity has not deterred me from taking on additional sessions”.

Those are concerning figures.

The review concluded that the rise is expected to continue. We have an historical average rise of about 10% per annum for scheduled care, and the rise is likely to continue. Of course, the review did not take into account the change in the discount rate. Just to remind everyone, the discount rate is used in a calculation to determine lump-sum compensation for claimants who have suffered life-changing injuries. It is being reduced to -0.75% from 2.5%; that will take effect, I think, on 20 March. This is the first time that it has been changed since 2001. It seems inevitable that that will inflate premiums further. We may have thought that we had solved the problem or that most of the problem was behind us, with the historical 10% average price increase, but the chances are that we ain’t seen nothing yet.

What is the impact on the ground? According to a practice manager at St Catherine’s surgery, a busy practice in the centre of Cheltenham, the problem is acute and having an effect on GP recruitment. When that practice wanted to appoint a new salaried GP, it was unable to attract anyone—notwithstanding the fact that Cheltenham is an extremely desirable place to practise, as I am sure everyone here would acknowledge and appreciate—without including paid indemnity as part of the salary package. That has added £7,500 to the cost of the doctor’s employment, and the surgery has to bear that, but this is plainly an unsustainable model.

I should add for completeness that this is not just about GPs in primary care. Modern surgeries are very sophisticated in the types of practitioner they employ. They employ advanced nurse practitioners and nurse practitioners with prescribing rights, but their indemnity payments are rising, too. An advanced nurse practitioner must pay about £3,000 per annum and a nurse practitioner about £1,200, and those figures are also increasing.

Why is all this happening? We need to slay two myths right from the start. First, it has nothing to do with GP performance dipping. Statistics show that the medical defence organisations have increased the proportion of cases closed with no payment made to the claimant from 70% to 80%. The quality and safety of care have never been higher. GPs continue to be very professional and very precise in the treatment that they administer. Secondly, the current situation is not down to profiteering by the medical defence organisations. The three main ones, which include the Medical Protection Society and the Medical Defence Union, are mutual organisations and not profit making. The 2016 review did not find evidence that market inefficiency is a cause of rising indemnity premiums.

The reason for the rises appears to be a blend of two principal factors. The first is workload. GPs are seeing more patients than ever before; I refer back to my remarks about the number of people in our country aged over 65 and 80. The second factor is compensation inflation. It is not unusual nowadays for insurers to pay a claim for more than £5 million. The review also alluded to a more litigious culture. There is a concern that patients are not simply being informed of avenues of redress, but are actually being encouraged to bring cases. It is a delicate issue, and there is a balance to be struck, but that does seem to me to be a concerning observation. That culture exists alongside an increasing number of claims companies. The number is said to be proportionally higher in England than elsewhere in Europe.

How do we respond? I have studied this issue in some detail: it is clear to me that Ministers and the Government in general are alive to it and working hard to react to it. As I said, back in May 2016 NHS England and the Department of Health established a GP indemnity review group to address the matter. That reported back in July last year and led to two important measures. The first was a winter scheme, originally scheduled to end on 31 March this year, to reimburse doctors who were willing to work more out-of-hours sessions to deal with winter pressures—I should remind Members that there is that 20% per annum rise in out-of-hours premiums. The second element was a new GP indemnity support scheme, which would run for two years.

The first of those—the winter scheme—has now been extended and will run until the end of April, which is welcome. As for the GP indemnity support scheme, it is excellent; it is direct financial support—hard cash—in the region of approximately £33 million per annum. The first payment will be in April 2017 to address inflation experienced in 2016-17, and a corresponding payment will be made in April 2018. I am grateful to the Government for those important steps, which will make a big difference.

However, we need a long-term solution, and I urge the Government that in considering the long-term options they leave nothing off the table. This does have to be handled carefully, but some options that I respectfully suggest merit further consideration are as follows. First, on legal reform, there is an argument for specifically fixing the amounts that can be recovered in costs by legal firms in certain cases. I am a lawyer by background, and should probably declare an interest—I even practised in clinical negligence law for a while. Clinical negligence claims can be highly complex. It is important that access to justice for wronged claimants is preserved, but that should not preclude any examination of the costs issue.

Secondly, even if it would be unaffordable for the NHS LA to cover all GP costs, we should look again at whether indemnity fees for certain areas of work, such as out-of-hours or minor surgery work, could be covered centrally. That would go a considerable way to easing the burdens on GPs and improving the attractiveness of the profession. I understand that the DOH is committed to exploring the potential of national clinical negligence schemes.

Thirdly, the Government could consider altering the mechanism through which awards are made, and base them on NHS costs rather than private costs. At the moment, payouts are quantified on the basis that care will be provided in the independent sector. Ought we to look at whether the law should be changed so that medical defence organisations and the NHS LA could purchase NHS and local authority care packages for those who have suffered from medical negligence?

I would be grateful for an update on the Government’s thinking on this important issue. Specifically, the review last year reported that further work would be carried out in 2016 to establish the best method for providing additional support in respect of out-of-hours care, so can we have an update on that?

I will end by saying that this may seem like a dry subject to anyone who is watching on TV or reading the report of this debate, but unless this problem is tackled in a fundamental way it risks undermining the excellent work that is otherwise being done to bolster primary care. It risks narrowing the pipeline of GPs—a pipeline we need to widen. The sums that GPs are now paying risk demoralising existing GPs and disincentivising the next generation. A long-term solution must be found.

Photo of Steven Baker Steven Baker Conservative, Wycombe 2:43 pm, 15th March 2017

It is a pleasure to serve under your chairmanship, Mr Turner. I congratulate my hon. Friend Alex Chalk on his excellent speech and on securing this debate, and very much concur with what he said.

Before I go any further I should say that my wife is a general practitioner, a former Royal Air Force senior medical officer, who now works as a locum for the Ministry of Defence. I should also say that any errors or omissions in my remarks are entirely my own; I only spotted this debate this morning so I have not had a chance to discuss the issues with my wife. The scale of indemnity fees and the rate of price inflation in them has been an occasional—possibly frequent—topic of dinner table conversation. It is quite clear that something is going on when we see such steep rises to such high levels.

I want to pick up on a few of my hon. Friend’s points. He made the point about GPs being the foundation; we cannot overstate that, particularly in the context of ever-increasing specialisation in secondary care. The point I wish to make to my hon. Friend the Minister is that it seems that, as secondary care becomes more specialist, the burden of diagnosis will increasingly fall on general practitioners. I have heard accounts, which I may relay imperfectly, of a thoracic problem, for example, being referred to secondary care; the consultant might exclude a heart problem, but then it has to be referred again to exclude a lung problem, and again for whatever it may be. My sense from listening to my wife and other GPs is that increasing specialisation in secondary care sometimes shifts the burden of diagnosis on to primary care.

It seems to me, if I may say so from the perspective of an aerospace engineer, that diagnosing people is a slightly less exact science than diagnosing machinery. That is partly because it relies on what people say about their own condition, and partly because it relies on their coming forward at the right moment in the development of their illness or condition. I wonder whether specialisation has led to a transfer of risk, which is material to premiums. I put that point to the Government; I appreciate that they might not be able to answer it today.

My other point is about the status of partnerships, which is both relevant to the future of general practice and tied into this subject. I have recently had occasion to discuss with a senior partner how it has become financially less attractive over recent years to be a senior partner. I have mixed feelings about that. One of the little discussed realities of the NHS is that general practice was never nationalised, so partnerships have always had this special status where they are private businesses tightly coupled to a state-funded and run NHS.

It seems that the problem of steeply rising indemnities is material to problems that partners face in continuing in business, often in ageing premises that they are locked into through mortgage conditions. If the Government intend for the partnership model to continue indefinitely, and if there is cross-party agreement on that, the cost of indemnity needs to be considered, along with a range of other factors in relation to that model.

My hon. Friend the Member for Cheltenham mentioned that he sees GPs as having a special status, and I think he is absolutely right on a number of levels. They are special in the sense of the GP’s place in the hearts of the public; special in the sense that, as specialism increases, so does the burden of diagnosis on them; and special in terms of the status they have as businesses operating within the NHS. More than that, as clinical commissioners, general practitioners now have the great burden of determining what care will be deployed where in the NHS.

It is proper that I restate that I have an interest in this, but I observe that the support being given in relation to GP indemnities is not being extended to the MOD’s locums at this stage. Armed forces personnel need healthcare too, and because of how armed forces medicine operates, the armed forces often need locums. I ask the Minister to consider the general point that the MOD might need the same support in relation to indemnity fees that general practice would enjoy everywhere else.

Finally, I do not think that this is a confrontational debate. We live in times when medicine has changed, people’s attitudes to risk have changed and the role of the GP is changing. We are all united—at least on this side of the Chamber, but I hope across it—in recognising that the Government are seeking to rise to all those challenges, and I look forward to hearing what my hon. Friend the Minister has to say.

Photo of Julie Cooper Julie Cooper Shadow Minister (Health) (Community Health) 2:48 pm, 15th March 2017

It is a pleasure to serve under your chairmanship, Mr Turner. I thank Alex Chalk for securing this debate on this really important subject, and join him in paying tribute to GPs—including those in my constituency and across the country, many of whom I have had the pleasure of meeting recently. I pay tribute to the excellent work that they do. They are at the cutting-edge of the NHS; in many ways, they are the gatekeepers, taking tough—often the hardest—decisions. They deserve our respect and support at every corner.

It is important to begin by setting this debate in the context of the pressures that GPs face. Undoubtedly, as has been mentioned, the demand for GP services has increased massively. Much of that has been attributed to the ageing population. Many patients suffering from mental health issues find that those are not addressed elsewhere, because specialist services are not as abundant as they might be. The lack of social care provision and funding cuts for social care mean that many unsupported elderly people have to call on their GP to work above and beyond, and on far more occasions, for the vital support that they are denied elsewhere.

We rightly heard about the recruitment and retention of GPs and support staff in practices. That issue is particularly important, because anything that is damaging or makes the situation worse is cause for concern. Recently, the Capita chaos relating to patient records and the national performance list did not help, placing more pressure on our GPs. The criticism relating to this winter’s A&E crisis, including the implication that GPs should somehow be doing more to lift the pressure, did not help either.

The hon. Member for Cheltenham rightly referred to the extra responsibility that GPs have taken on with commissioning. That important role has put extra demand on them. I agree totally with his very good point about the pressures that are coming back upstream because of increasing specialisms in hospitals. I met GPs and some of their staff recently and was concerned to hear them say, “Of all the health professionals, we feel that nobody speaks up for us,” so I welcome this debate. It is right and proper that we in this House recognise and put on the record the value of GPs.

The rising cost of professional indemnity is an added burden, and frankly, doctors do not need anything else to deal with, nor do other medical specialists within GP surgeries. As has been outlined, 95% of doctors report phenomenal increases in indemnity costs. I will not repeat the figures, but the rises have been unacceptably high. I underline that the increases in costs are in no way due to a deterioration of professional standards—absolutely the reverse is true. Standards are at least as high as they have ever been, and in most cases, they are higher. The current situation is, in fact, due to the sheer volume of work done by general practice. When that grows to such an extent, the amount of complaints against the service are bound to go up too.

We live in a different society and a different, increasingly litigious world. People are encouraged to take action for sometimes minor issues, hence the need for doctors to have professional indemnity covering them up to about £20 million, which I think is the figure that people widely acknowledge they need to be covered for. That is why there has been the massive increase in the premiums.

This is an English problem. Although proper analysis has not been done on GP practices elsewhere in the UK, evidence shows that it is less expensive to practise over the border in Scotland and in Wales, where I understand the new contract provides for the out-of-hours work that GPs do, as well as support for the costs of their regular work.

The impact is serious, and the fact that no long-term solution has been found for the problem is having an effect. The Royal College of General Practitioners reported that 80% of GPs say that the time that they are prepared to devote to general practice is affected, whereas 56% said that it would be more likely to deter them from doing out-of-hours work. If the problem is unaddressed, it will undoubtedly affect the long-term recruitment and retention of dedicated people in general practice.

I think we all agree that action is needed. The review group set up in May 2016 introduced short-term interventions, which were really welcome, as has been mentioned. Those will help this year and next towards the costs. The extension of the winter indemnity scheme is also welcome. I understand that the continuation of that led to 500 GPs committing to out-of-hours care, above and beyond the existing number. That surely indicates what the effect of supporting GPs in that way will be.

What action is needed? The Government must begin by demonstrating that they value GPs and recognise the considerable pressure under which most GPs and their staff work. I am sure that hon. Members on both sides of the Chamber agree about that—nor would we find many dissenters among hon. Members who cannot be present today. We must ensure that the Government honour the commitments in the “Five Year Forward View”, including the £2.4 billion extra each year for general practice—we must make sure that is delivered in a timely fashion.

I was concerned to hear the royal college express dissatisfaction that up to Christmas, only £2.4 million of the £16 million designated for resilience for GP practices had been committed. We must do better on that. As a matter of urgency, the Government need to carry out a comprehensive review to find a long-term solution. The hon. Member for Cheltenham made sensible suggestions on legal reform. Perhaps a centralised payment for out-of-hours care would support all that. It seems vital that any costs are in line with NHS treatment and not that in the private sector.

The previous Minister, Alistair Burt, said in March 2016 that the Department of Health would begin to consult GPs, patients, lawyers, medical defence organisations and commercial insurance to look for a long-term solution. That was a year ago, so I look forward to the Minister telling us what progress has been made. Although Chaand Nagpaul, the chair of the British Medical Association GP committee, welcomed the short-term help, he went on to say:

“There is a need for a definitive solution to rocketing indemnity costs”.

Will the Minister tell us what progress has been made? What action has he taken in all those areas to ensure that GPs feel fully valued, and to show that we feel for them when it comes to this extra burden and have taken action to deal with it?

Photo of David Mowat David Mowat The Parliamentary Under-Secretary of State for Health 2:58 pm, 15th March 2017

It is a pleasure to serve under your chairmanship, Mr Turner, and I congratulate my hon. Friend Alex Chalk on bringing this really important subject to Westminster Hall this afternoon. The NHS spends between £1.5 billion and £2 billion a year on legal and indemnity costs. If we could find a way to spend that massive slug of money better, that would be better for patients and our constituents, and all that goes with that.

I will start where my hon. Friend started in his really lucid speech. We need to emphasise how much we value GPs, as all Members did who have spoken today. In a speech that I gave recently to GPs, I used a sentence from the foreword by Simon Stevens to the “General Practice Forward View”, and I will use it again now:

“There is no more important job” in the country

“than that of the family doctor.”

I think that is very good—everybody is nodding, so I think we all agree. There is no harm in our reminding any family doctor who may be listening to this debate of the esteem in which they are held.

My hon. Friend the Member for Cheltenham made some interesting points about the potential for legal reform. We are consulting on that and I will say a bit more about what we are doing. I will give the House one statistic that stuck in my mind as I was preparing for this debate: for legal cases with awards of £10,000 or less, the average costs are three to four times higher than the actual amount paid to the patient. That is indicative of a broken system that we need to fix. He made a point about using the central scheme, which applies to hospital doctors, for GPs. That is an option, but as he also said, the three insurance organisations are non-profit-making, so it is not absolutely clear how it would help.

Another thing I was surprised about was an interesting point that my hon. Friend and, I think, Julie Cooper made about the way in which costs are estimated for difficult and complex cases. We would all concede that it is right that we properly recompense people who have been damaged through negligence and so on, but one of the things that that is based on is private health insurance rates, not the NHS doing the work. I have discovered the reason for that: it is what was set out in the National Health Service Act 1948, which set up the NHS. We are looking at options around that, but the history of how that evolved and why it became the case is interesting.

Photo of Steven Baker Steven Baker Conservative, Wycombe

I am grateful for the opportunity to recommend an excellent book: “Working-Class Patients and the Medical Establishment”, by David G. Green, who now runs Civitas. It tells that history, and there are a great many similar examples where we might look at how we can reconnect the whole system with the patient.

Photo of David Mowat David Mowat The Parliamentary Under-Secretary of State for Health

I thank my hon. Friend for that intervention and for the interesting comments he made. He talked about the transfer of risk due to specialisation, which is an interesting concept. I will push back a little on that, however. Of the £50 billion of reserve that the NHS needs to hold for legal cases and compensation payments into the future, the vast majority is around maternity, because the money tends to be focused on babies who are injured and have to be supported throughout their life. I am not absolutely sure he is right about that concept.

My hon. Friend made a point about the status of partners in GP practices. Partners have unlimited liability unless they have indemnity, which potentially makes it less attractive to be a partner than a salaried GP. We are seeing that trend. There is a double edge to that, and I will not go into other aspects of how GP practices are structured, but increasingly—I do not know whether this applies to my hon. Friend’s wife—we are finding that things are working better with GP practices being put into hubs of 35,000 to 40,000 people. They are able to employ pharmacists and physios and do more things at scale than they could as a single GP practice or as a practice of two or three GPs, which has historically been the norm.

We are migrating over time from a position where we have 7,500 GP practices to one with something more like 1,500 super-hubs, but it is true to say that the contract position has not caught up with that, and it is a long road. Tomorrow, I am going to visit a hub in Dudley. Super-practices are emerging, which have tens and possibly hundreds of GPs who can provide services across much wider areas. That is a different model, and there is some evidence that such hubs can provide more career structure for GPs and the opportunity to specialise in a way that they have not been able to in the past.

Photo of Steven Baker Steven Baker Conservative, Wycombe

I must admit that I missed the Government’s plans to move to super-hubs. It sounds quite suitable for Wycombe. Without wishing to make this debate about my wife, she is with the Ministry of Defence. At the moment, the MOD is providing healthcare to units or stations, or whatever bases they may be. How would the super-hub proposal work with the armed forces?

Photo of David Mowat David Mowat The Parliamentary Under-Secretary of State for Health

I had forgotten to talk about MOD locums. My hon. Friend raised that issue, and I do not know the answer, but I will write to him and give him the information he needs, and he can talk to his wife about that. I was surprised by that example. I am sure that between the various parts of the Government, we can get an answer.

In the hour available to me, I will discuss in more detail the environment in which the NHS finds itself, the impact and the Government actions we are taking, but I will start with this: we all want access to justice. That is a fundamental of our country, and we should do or say nothing that causes people who have been badly treated to lose out. Lawyers have to be part of how they get access to justice, and that is right, but we also need to protect the viability of our NHS.

We are spending towards £2 billion a year in this area. That is £2 billion a year that we are not spending on nurses, doctors and the improvements we would all like to see. We often have debates about the level of NHS spend compared with other countries in Europe and different parts of the world, but one area in which we can say we are a leader in Europe is the amount of money we spend on litigation and all that goes with that. That is not because our NHS is less safe than other systems; it is to do with some of the points that were made earlier about the litigation culture that has built up. To an extent, that has been encouraged to build up because of our treatment of costs and some of those things. That spend of £1.5 billion to £2 billion has been increasing by something like 20% a year in the past three or four years. We cannot afford to continue to spend money in that way.

GPs are not the most expensive part of the system, but as my hon. Friend the Member for Cheltenham said, GPs typically have to spend £7,900 out of their own pocket on indemnity. That figure is increasing by 10% a year. Indemnity costs for GPs who do out-of-hours work are increasing by 20% a year, which has knock-on effects for the attractiveness of that work. As we discussed earlier, it also impacts on people in other ways, such as propensity not to become partners in GP practices.

What has made the acceleration in legal costs evident is not so much the major claims that everyone would agree need to be sorted out and dealt with—for example, babies who are damaged at birth and need to be looked after for their entire life—but the significant increase in the number of minor claims, which tend to have a higher proportion of associated legal costs. As I said, claims of around £10,000 would typically have legal costs in excess of three times the amount that the patient would receive. My hon. Friend the Member for Cheltenham said that many claims are successfully defended, and the fact is that 99% of all claims are settled out of court. There can be a tendency to settle minor claims for relatively small amounts—claims under £100,000—just because of the volume that are coming in and because it is cheaper to settle than fight to the end. All of that takes money out of our NHS.

We have talked a little bit about why this is happening. The life expectancy of people with complex needs is increasing, so if someone is damaged at birth, typically the awards they need go on for much longer than in the past. That is a good thing in terms of life expectancy, but it drives cost. There is a view that the best-quality care becomes more expensive. Technology is a part of that. We also have an environment in which, for whatever reason, there has been an explosion in small claims against the NHS, which particularly affects GPs, and there is a legal environment in which even unsuccessful claims or claims without merit can sometimes be rewarded. All of that is made worse, as we have heard, by the change to the discount rate made by the Lord Chancellor, which will come into effect next week on 20 March.

The time value of money essentially was 2.5% and is now going to be -0.75%. That will have a significant impact on all insurers in the private and public sectors. It particularly affects the health sector. The £59 billion reserve that the NHS has for central litigation costs will increase because of the change that has been made by something in excess of £5 billion or £6 billion. Those are significant and serious sums of money in the public purse. The Government’s position is that doctors will not have to pay as a consequence of the technical change in discount rate. We are working through how that will work in the central litigation authority and the three insurance companies that my hon. Friend the Member for Cheltenham mentioned. Nevertheless, the cost is significant in the context of all the other pressures on the health system.

A couple of Members talked about the fact that the issue affects not only doctors in primary care but pharmacists. Increasingly, clinical or prescribing pharmacists are working in primary care and they need indemnity, as do nurse practitioners. We need to remember that that is all part of the picture.

Photo of Julie Cooper Julie Cooper Shadow Minister (Health) (Community Health)

On that point, is the Minister prepared to acknowledge that professional indemnity is a significant burden for community pharmacists? That is something he might want to consider before going ahead with his funding cuts.

Photo of David Mowat David Mowat The Parliamentary Under-Secretary of State for Health

I will not be dragged into the issue of community pharmacists other than to say they are extremely valued and have a major part to play as we integrate them with the clinical pharmacists working in GP practices. I will simply say, since the hon. Lady has raised it, the Government are committed to getting community pharmacists to move into a much more service-oriented way of working. We will not do that by overpaying for prescribing or by acknowledging or encouraging clustering, which is what the reforms we have talked about will address.

So what are the Government doing? First and foremost, we need to continue the drive to improve standards and quality in the NHS. I made the point earlier that accidents happen and negligence takes place. When it happens, we need to learn from it and ensure that there is a duty of candour within the service. Doctors and nurses need to do what they can to make sure that the systems failure or breakdown that occurred does not happen again. To use a rather trite management consultancy-type phrase, the NHS needs to become a learning culture. It is true, however, that people need to learn from errors and continually try to improve standards. We need to avoid errors as much as possible, but at the same time we cannot have the medical profession being overly defensive, because that is not the right answer either.

My hon. Friend the Member for Cheltenham discussed what we have done so far in the “General Practice Forward View” to protect GPs from the rising costs of indemnity. Some £30 million a year is being paid out for the year just gone. There is a clear commitment in the forward view. The increases in indemnity costs, which are not a consequence of GP actions or failures or whatever, will be indemnified by the Government. I repeat that again today. I have already made the point about specialist nurses and pharmacists.

We are trying to make progress on the law and address the level of costs awarded in some cases. The 12-week consultation on fixed recoverable costs began on 30 January this year. In the case of smaller claims, proposals include a cap on solicitors’ fees and on the hourly rate for expert witnesses and locums. It is also proposed that both sides share a single joint expert witness, because it is not always sensible to have two expert witnesses arguing with each other: it is possible to do that in a more effective way. The direct aim of the consultation is to reduce the ratio of the amount of money that the patient gets to the amount of money that the lawyer gets, particularly in the lower-value cases. The Government look forward to the results of the consultation and we hope we can move forward.

Another aim—this applies less to GPs, but is also very important—is to do what we can to keep cases out of court altogether by means of the rapid resolution and redress scheme. I have talked a little about maternity cases, but because of the level of the costs and the complexity of the case it can take many years for payments to start being made. That is not right because, from a justice point of view, the baby or the baby’s family needs the money more quickly. It can sometimes takes nine, 10 or 11 years until the legal side is sorted out, and that is not just.

We began a consultation on the rapid resolution and redress scheme in October last year. The scheme tries to keep the whole thing out of court by attempting through mediation and working together to come up with a sensible and fair solution much quicker so that the 11 and 10-year court cases are avoided. We will try and make progress on that. We have not talked about tort reform. The Government are not currently working on that in respect of indemnity, although that was implied in some of the remarks that my hon. Friend the Member for Cheltenham made.

I will finish where I began. Indemnity is a very important area for the NHS. We are spending towards £2 billion a year. That cost is accelerating and will potentially undermine the level of care that we can give. We need to do what we can to moderate costs.

Photo of Alex Chalk Alex Chalk Conservative, Cheltenham

I am encouraged to hear that some important initiatives and measures are being considered. Can my hon. Friend give us any idea of the timescale as to when an overall final outcome and settlement, or solution, is likely to be presented?

Photo of David Mowat David Mowat The Parliamentary Under-Secretary of State for Health

The two consultations will take 12 weeks. In a sense, my hon. Friend’s question is false. I do not think there will ever be a final solution because we are trying to reconcile two powerful forces: the need for access to justice and equity for people damaged through negligence and the need to be fair to our NHS. There will always be issues that evolve. The discount rate, for example, which we have talked about during the debate, will vary depending on where interest rates move in the months ahead.

We are talking about something that will always have to be kept under review. There will not be a final solution, but the two consultations that I mentioned will make a material difference and I am keen that we should make progress on them as soon as we are able to.

Photo of Heidi Allen Heidi Allen Conservative, South Cambridgeshire

I appreciate the Minister’s giving way, particularly as I was late arriving for the debate, and so may have missed some key points. Building on the point made by my hon. Friend Alex Chalk, of course I welcome the Government’s interventions, the consultation, the winter scheme and extra money for GPs to cope with inflationary pressures. The problem is that the costs are already so high.

Addenbrooke’s hospital in my constituency is losing trainee doctors, who are put off by the cost. Older doctors are retiring early. Doctors are thinking twice about going into specialisms because there is perhaps a higher associated risk. Is there nothing else that we can do? Hospitals have Crown indemnity. Could we consider that for GPs? Could we extend it to them, as an alternative idea?

Photo of David Mowat David Mowat The Parliamentary Under-Secretary of State for Health

Those are all fair points, but in the GP forward view we have said that GPs will not bear the cost of increased indemnity—the Government will; and that is a commitment that we are holding to. The increased costs incurred last year are being paid through the GP contract, following the discussions that we have had with the BMA, and the cost of that to the Government for this year is £33 million. That is a commitment that will go into the future.

However, my hon. Friend makes a fair point that in a country with a shortage of GPs, where we are trying to recruit a further 5,000 doctors to work in general practice by 2020, we need to make the profession attractive. We are trying to do that, and there are different ways to do it. Indemnity is just part of it. To answer her point, I would say that this year the number of medical students going into GP training is the highest ever achieved. Something over 3,000 are going into the training, and we need them all. I responded to a debate here yesterday about a shortage of GPs in Essex. Frankly there are shortages everywhere; we understand that.

In a sense, I share the frustration of my hon. Friends the Members for South Cambridgeshire (Heidi Allen) and for Cheltenham and the feeling “Why can’t we just fix this?” The answer is that there are legal rights that we cannot just take away; we cannot say that it will just not be possible to sue the NHS in future. That is not the system in the country that we live in. However, we need to do moderate, sensible things to bear down on costs, so that we spend a greater proportion of NHS money on doctors than on lawyers. All of us in the Chamber would agree on that.

Photo of Alex Chalk Alex Chalk Conservative, Cheltenham 3:22 pm, 15th March 2017

I thank all hon. Members who have taken part in the debate. I think that four things have emerged. First, there is an overwhelming and unified view that GPs are an enormously valuable part of the health service; it is important to underscore that point at every opportunity. To be blunt, I think that GPs sometimes feel got at—in the media and even in this place, I dare say. The message that needs to ring out from this Parliament is that we see GPs as the foundation stone of the NHS. What is good for them is good for patients, and what is good for patients is, of course, good for the country.

Secondly, there was a frank acknowledgement of the scale of the problem. My hon. Friend Heidi Allen made the point that, notwithstanding the increases that we face, the present burden is itself demoralising GPs, and acting as a disincentive to becoming a GP. I take on board, however, the Minister’s point about the record number of applicants.

Thirdly, I am grateful that the Government are clearly taking the issue seriously, with the winter scheme, which has been referred to several times, and the £33 million per annum being invested to cover the cost of the increased indemnity. That is extremely welcome.

I shall close on the fourth point. GPs need to hear that the short-term solutions will translate into a long-term one. I was encouraged by the Minister’s comment that the commitment being made at the moment with respect to the increased indemnity, of £30 million a year, will go into the future. In the not-too-distant future, we need the message to go out that the matter is being addressed, whether through that scheme or another one. It needs to be addressed coherently, sustainably and clearly, sending GPs—whether locums or permanent—the most straightforward message possible: that they are welcome and valued, that their finances are understood, and that we want a system that works for them as well as for patients.

Question put and agreed to.

Resolved,

That this House
has considered the cost of GP indemnity in England.

Sitting suspended.