2017/18 GMS Contract Changes – What Does It Mean For My Locum Insurance?

What the GMS Contract Provides

After 2 weeks’ absence due to sickness your Practice may be entitled to receive £1,734 payable for 24 weeks reducing to £869 for a further 26 weeks.

There are gains here, but what are the Pitfalls?

  • You will still need to ensure that your Practice has enough financial cover, as the reimbursement will not be enough for most practices to pay ever increasing Locum Agency fees.
  • The reimbursement scheme is available for GP partners & salaried GPs. However, nursing, managerial and non-medical staff will not be eligible for the reimbursement. There is also a question mark regarding the reimbursement being available for long term Locum GPs.
  • Only absences due to sickness will be covered, there is no reimbursement payable for Suspension, Revalidation, Family Emergencies, Death, Compassionate Leave, Parental Leave, Jury Service or any other additional benefit beyond sickness cover.
  • The 2017/18 GMS Contract reimbursement scheme is a reinvention of a previous version. In 2005 more and more restrictions were applied to the old scheme until most Practices were unable to claim reimbursement costs. How long will this latest reincarnation last before restrictions start to creep in?
  • The long term funding of these changes is not clear and based upon our years of dealing with Locum claims it will need to be very substantial indeed. The current insurance model is backed by financially secure companies providing long term commitments and contractual certainty.
  • Your current MIC policy may be covering a previous medical condition. Cancelling your current policy or increasing the excess period will have an impact on the terms applied in the future should the NHS England reimbursement scheme be restricted in the future.

What should you be doing or thinking about?

  • Locum policies don’t just cover sickness, cancelling them exposes you to costs you previously had covered.
  • The contract changes are for GPs only, so consider the cost of a potential loss of other staff members and the benefits they can receive from your Locum policy.
  • Reliability and consistency! These two key points have yet to be proven from the new GMS contract changes.
  • If you feel comfortable with the new GMS contract, review your policy and look to utilise split deferred periods, variable benefit payment or just remove sickness cover.

If you would like to discuss your requirements further please contact MIC on 0800 163870

Non-Disclosure Deliberate or Accidental?

When it comes to insurance claims the answer is not always quite so clear cut.

If a material fact has not been disclosed it may well alter the way that a particular risk is assessed.

Example 1: A Locum Insurance policyholder submits a claim, medical information is requested and this persons GP stated that he had not seen this patient for a particular condition for which the claim is being made – fairly straight forward so far.  However, this person had been treated by another doctor for the same condition and had failed to disclose this on the Locum Insurance application form.  If this information had been declared it would have affected the assessment of this persons Locum Insurance application.  My assessment – non-disclosure.

Example 2: A practice manager signs a declaration for Locum Insurance on behalf of the GP Partners who are insured.  This declaration requests information about all of the insured persons.  To the practice managers knowledge nothing has changed since the application forms were signed.  Unfortunately one of the insured GPs had not told any of the partners or practice manager that he had received treatment for a particular illness.  This would have altered the terms that this GP had received under our Locum Insurance policy.  My assessment – this is an awkward one as the practice manager had acted in good faith and declared what he thought was correct. Was enough done to verify information?

What can be learnt from the above?  Non-Disclosure whether deliberate or accident can cause real financial problems for an individual, as well as a practice.  If in doubt, giving more information is better than less!

Stresses and Strains!

I am seeing more and more claims where the word STRESS is used on med certs under Locum Insurance policies and so I decided to look up the definition in the Oxford Dictionary.  The first definition that I came across was” tension exerted by a material object” – this did not fit the bill.  The next definition was more interesting “a state of mental or emotional strain or tension resulting from adverse or demanding circumstances”.

I now wanted to apply this definition to the Stress Claims that have been made under Locum Insurance policies that we design and arrange for the healthcare professions.  Very rarely was a reason given for being unable to perform normal duties apart from the word Stress.  Could it be work related, personal problems or financial strains? Whichever one it is, the sooner a plan of action/treatment is started the quicker the recovery time for that person. It sounds so simple.

Most medical practices have a Locum Insurance policy to cover the practice partners/staff in the event of sickness accident and absence.  However, there is usually an initial 4 week period in the policy (to tie in with the practice agreement) where the practice cover the costs incurred for partner/employees – this is referred to as the deferred period.  It is quite common for a claim to be notified just before or just after the deferred period.  Here lies the problem when the claim being made is for stress.

The person making the stress claim has already had 4 weeks off from their normal duties and relies on the medical certificate issued by their GP.  Enter the MIC Early Intervention Scheme that can provide counselling after 3 days and if the problem is skeletal, physiotherapy is also available after 3 days.  It makes sense that if the problem is tackled right from the start it is easier to manage.

The MIC Early Intervention Scheme is not designed to replace procedures that are currently in place, it is designed to assist the practice and individual in their recovery and rehabilitation.  This is in everybody’s interest.  The practice manager does not have to continually look for a Locum, patients can see their normal doctor and it also complies with the Management of Health & Safety at Work Regulations (1999), where employers must assess the nature and scale of health risks at work and must take measures to control them.

Here are a few examples of genuine claims for stress:

  • Full time GP – £1000 per week benefit – Total claim £48,000 – Time off 48 weeks
  • Full time GP – £1375 per week benefit – Total claim £31,625 – Time off 27 weeks
  • Part Time GP – £687 per week benefit – Total claim £26,793 – Time off 42 weeks
  • Part Time GP – £950 per week benefit – Total claim £20,900 – Time off 26 weeks.

Total amount paid for these claims £127,318. Total time off 143 weeks.

Insurers are now becoming more concerned and looking for more ways of controlling stress claims.  The MIC Early intervention Scheme is the start.

We Started To Change Locum Insurance Cover Nearly 20 Years Ago

Medical Insurance Consultants (MIC) was one of the first if not the first to introduce a Locum Insurance Policy with continuity of cover.  Before this there were Locum Insurance Policies on the market that offered Permanent Cover throughout the term of the policy (like a PHI policy but with a limited benefit period of 12 months and to age 60 or 65) and Annually Renewable Cover where the terms and premium were assessed each year.  The choice then was very simple  – pay a fairly substantial premium each year with the Permanent Locum Insurance Cover, but know exactly what you were covered for, or take the risk each year with the Annually Renewable Locum Insurance Cover, where there were potential changes in the cover and premium.

I decided that MIC could produce a policy which picked the best parts from each policy.  With our specialist underwriters the MIC Locum Insurance cover with ‘continuity of cover’ was born.  The policy was annually renewable, but this time it contained a clause that stated that the terms would not be changed so long as the policy remained in force.  The cost of this policy was considerably cheaper than the Permanent Locum Insurance policy, but offered many of the benefits.

It took several years before similar Locum Insurance policies were produced by other insurance providers.  However, what was the point of producing a policy identical to the MIC Locum Insurance policy?  The cover needed to be expanded from the essential Sickness and Accident cover that was there from the start.  Now we see cover for delayed flights, funeral expenses, suspension and revalidation, paternity and maternity all of which have very little if anything to do with a Sickness and Accident policy.

Just ask yourself this question – out of all the covers that I have mentioned, which one are you most likely to need?  The answer (reviewing claims statistics) is Sickness cover and yet practices seem to be won over by the “add ons”.  It is therefore crucial that the Sickness cover is as you want it in terms of the amount and the benefit period.  Each partner and each member of staff can have different benefits and terms, thus giving the cover that is needed.  The average benefit that a full time GP is insured for is around £2500 per week and there are no signs of any reduction in Locum costs.

How can you choose the right Locum Insurance cover for you?  With difficulty, as there are now so many providers all wanting a share of the “Locum Insurance Pie” and all offering Locum Insurance policies all of which have the basis of the original MIC Locum Insurance policy – Continuity of Cover (although the term has been hijacked to mean different things in other policies).  The “add ons” or “whistles and flutes” as one practice manager called them has to be paid for and do not come “free of charge”.  The cost has been included in the policy premium – it just has not been shown as a separate premium.

Where do we go from here?  I suspect that very shortly the wheel will have turned a full circle and that Locum Insurance cover will be for Sickness and Accident only, thus reducing the cost of the cover and going back to the original MIC Locum Insurance policy.

What And Where Are The Pitfalls/Problems?

The biggest problem that I have seen over the last few years has not been the type of policy or even the cost of the policy, it is how sales people interpret the cover offered by competitors even to the extent of producing comparisons which include competitors details that are out of date.  It undoubtedly makes their offerings appear even better.  There will of course be a “get out of jail statement” that says something like “details are based on our current understanding” of the competitors cover.  In addition, it is not unusual for two totally different Locum Insurance policies to be compared, but with the suggestion that they are both the same type.


What Are The Types Of Locum Insurance Policies Currently Available?

  • Option 1 – A permanent policy that is medically underwritten and the terms for the cover are given and will not change for the life of the policy.  The premiums for the cover can be age banded or index linked. This is the most expensive option.
  • Option 2 – An annually renewable policy that is medically underwritten and has continuity of cover (or as we now call it Health Protector Promise), so the underwriting terms applied remain unchanged at renewal.
  • Option 3 – An annually renewable policy that has continuity of cover. There is no medical underwriting as the cover is established using a pre-existing condition/prior absence exclusion, ruling out any condition that has occurred for more than x number of days in the last y years, as well as other terms.
  • Option 4 – An annually renewable policy that does not cover any pre-existing condition that may have occured, therefore covering only new conditions. This is the cheapest option with the least cover.

When you do get a comparison or compare a policy yourself, just make sure that the policies are all of the same option type above.  What is the point in comparing Option 1 with Option 4 above?

Just to confuse matters even more, I have seen a clause in a Locum Insurance policy that enables the terms of the policy to be changed in event of the “loss ratio”  (premiums received v claims made) reaching a certain percentage.  So much for saying that the terms will not change.

How Often Do You Need To Review Your Locum Insurance Cover?

In short there is no one answer that fits all.

If you are satisfied with your current provider, the terms are right, the premium is good and they provide you with a good service then what is the point of changing.  However, if you are driven purely by cost then the next paragraph will be of interest.

If the cover that you presently have seems to go to a different insurer/underwriter every one or two years but remains with the same provider/broker,  the alarm bells should start ringing.  The usual reason given for the change is to reduce the premium or providing better cover.  What is probably happening is that the insurers/underwriters are now getting the claims coming in and are now starting to look closely at the current premiums charged.  The problem here is that changing from one insurer to another only brings around more conditions (medical underwriting/pre-existing condition exclusions etc.), a logistical nightmare when you come to claim or are currently claiming.

What relationship have you built up with your current provider?  This counts for an awful lot.  It should give you the confidence that you need.

One last point (forgive me for going on about it) – again I have a problem with some of the sales tactics that are used to encourage practices to change the provider of their Locum Insurance cover.  We go back to the comparison, and then there is interpretation of the policy wording.  On the MIC Blog you will see articles that bring into the open techniques that are used by sales people to get the business.  Make sure that the facts speak for themselves rather than the sweet talking sales patter.

Two Tips

  • Use the experience gained by companies that have been doing this for a long time.  My experience and that of MIC is spread over nearly 20 years of providing locum insurance!
  • Never assume that because you are dealing with/through a buying group, the Locum Insurance policy they are offering is the best available, usually it will be with one company they have partnered with, as FCA regulations are quite tight on this.

written by John Downing, Executive Director, Medical Insurance Consultants Ltd

Locum Insurance – How elective is elective?

When I hear the phrase “elective surgery” I usually think that the procedure is not really necessary but the person has decided to have the procedure for whatever reason. How wrong could I be?

Recently I saw a claim where the GP of the person claiming and the person claiming described the claim as “elective surgery”.  As the claim being made related to a Locum Insurance policy the claim was initially declined.  I haven’t yet come across a Locum Insurance policy that covers “elective surgery”.

A classic example of “elective surgery” is the removal of the gall bladder to rid the patient of pain.  The patient could not have the gall bladder removed and as such the pain would continue.  Fortunately at Medical Insurance Consultants (MIC) we have specialist insurers and claims managers who differentiate between “elective surgery” where the surgery is cosmetic and what I describe as “sensible elective surgery” where there is no cosmetic element to it.  It is for the patients health and wellbeing.

If you need to claim on your Locum Insurance policy and you feel that the word “elective” is being used, make sure that there is a full explanation from your GP/Surgeon/Physician as to why the procedure is being carried out.

This is another good example of how £000s could be lost when trying to claim on your Locum Insurance policy.

View Medical Insurance Consultants locum & absence insurance here.

How does the word “LATEST” change everything?

Whether it is being used when comparing Locum Insurance or Surgery Insurance quotations it is so misleading. I will bet that when you see this word your initial thought is that what is being compared is a true comparison and up  to date. WRONG – What it does mean is that the person/company who is using the “LATEST “policy wording or definitions which could be light years away from what is currently being used.

Why is it done? One explanation that I have recently seen is “to help you to make an informed judgement”. Where is it used? Usually when comparing Locum Insurance products. The reason? My bet is to kill off competition.

I must admit I find it difficult to understand what is going through the sales persons mind when they are using such a tactic. It is misleading and could cost the person/practice £000s

It becomes a little better when the comparison is made when using the details from the policy document that the client may have. But still this is not 100% accurate.  At Medical Insurance Consultants we reassess the cover that we offer and the premiums that we charge for Locum Insurance at least once a year.

This has been the “LATEST” comment!   –  Beware

Comparing Interpretation – Locum Insurance: Another Loss of Cover – part 3

When you think you have got your Locum Insurance under control up pops another little phrase that changes everything.

You could quite easily miss this one. It is usually in the definitions section of the Locum Insurance Policy. It relates to the definition of Illness and it reads like this – “Illness that is first diagnosed after the effective date of the policy”. In other words when you sign up for this type of cover any condition/illness that you have had in the past will not be covered.

This is a very good way from the Locum Insurance insurer’s point of view of getting rid of any claims where an illness/condition manifested itself prior to the Locum Insurance Policy being taken out. It could also include a condition that you consulted your medical practitioner about in the past, but did not claim any time off work.

This makes a huge difference to the cover and could end up with the practice being left with a large hole in the practice coffers!

Here is just one example of Locum Insurance claims that would not have been paid using the above definition:

Consulted my GP several years ago and was told to “take it easy” – onset of depression. No time off work and no medication prescribed. Didn’t take the advice. Now worse than ever – Need time off work and medication. The claim for this would be rejected as the condition was first diagnosed 2 years ago, prior to the effective date of your insurance.

The cost to the practice –  Just work it out – x number of weeks off times y £s per week – Say 13 weeks off at £2000 per week (the practice agreement will probably say that the first 4 weeks of illness are paid by the practice) which leaves 9 weeks at £2000 per week – £18000. This is a conservative estimate.

Twelve words in a Locum Insurance wording can cost a lot of money!

Medical Insurance Consultants

Getting Your Locum Insurance Claim Paid – A Potential Problem

Another bit of “policy small print” has raised its ugly head.

You automatically assume that so long as you have provided all that was necessary to claim on your practice’s Locum Insurance policy you would be paid the amount that was insured for the period of the illness less the deferred period that was chosen.

Here is a good example of what can go wrong if you are not careful.

Let us just suppose that your practice makes a claim in September 2014 and the policy was due for renewal in November 2014. Which option would you choose?

Option 1 -You renew the policy and all goes well and the claim is paid.

Option 2 – This is what can happen – You decide to move, for whatever reason, your Locum Insurance to another provider? Your claim will cease if you do not renew your Locum Insurance policy with your current provider.

Fortunately there are not many providers that operate Option 2, but you need to be aware that it does exist and check your policy wording.  Medical Insurance Consultants do not operate such a policy!

Medical Insurance Consultants

Comparing Interpretation – Locum Insurance: “Normal Terms” – part 2

‘Normal Terms’ – these two words can cost your practice a lot of money. It seems ridiculous to make such a statement but it is true.

Here is an example:

You are changing your Locum Insurance cover to another provider as they have quoted a premium that is lower than what you have been paying.

You have been told that you will receive “normal terms”. To the uninitiated this suggests that everybody is fully covered. What it really means is that everybody is covered as per the policy conditions and exclusions and there can be some nasty little clauses in the policy that changes everything.

It goes like this – The Practice Manager gets a cheaper Locum Insurance quote and is told by that potential new provider that even though the practice had made a recent claim the condition that was claimed for would be covered and would be given “normal terms”. When challenged on this point (the practice manager has been alerted to a particular policy exclusion) the potential new provider admitted that as the policy had a “pre-existing condition exclusion” there would be a period before the condition that was previously claimed on could be covered. This situation did happen and the Practice Manager made the right call and kept the cover they had.

Remember – The policy conditions and exclusions determine what locum insurance cover you have. If it seems too good to be true it probably is.

Medical Insurance Consultants

Completing A Medical Confirmation Form on Behalf of Partners/Staff

Here is the classic case through the eyes of a Practice Manager:

Just filled out the form for our Locum Insurance and as far as I am aware none of the individuals that are being insured have had any anything wrong with them in the period requested. Insurance now in place – On to the next job.

Some months later – One of the partners has been off sick with a stress related condition for the last 3 weeks and it looks as though he will be off for another 8 weeks at least. Contacted our insurance broker/company and requested a claim form. The claim form has been completed and has been sent to the insurance broker/company. I am now waiting to be paid as we are already employing a locum.

To my amazement I have received an email/letter from the insurance broker/company saying that they will not be paying the claim due to non-disclosure. I now find out that the partner who is off sick had suffered from a stress related condition in the preceding x months. Not a happy bunny at the moment to say the least!

The partners reason for not disclosing this to me  – He/She did not think that the previous condition warranted a mention.

Make sure you stress the implications of not fully disclosing medical condition.