What will be the final bill for past negligence cases?
Long-running negotiations with the Medical Defence Union led to a settlement of €45 million
The net effect of the settlement agreed between the Government and the Medical Defence Union is that the State will receive €45 million. However, it is likely to have to pay out considerably more overall in meeting the cost of negligence claims against members and former members of the indemnity organisation.
The Medical Defence Union was one of two UK-based indemnity organisations which provided cover for doctors in Ireland for decades. In the case of many doctors working in the public system, the State subsidised the premium cost. However, the Medical Defence Union is not an insurance company but a mutual organisation. The provision of cover for members is not guaranteed, rather it is discretionary.
Clinical negligence
The row between the Government and the Medical Defence Union dates back to the introduction by the State of a clinical indemnity scheme nearly a decade ago, largely because of concerns about costs.
The scheme, which is operated by the State Claims Agency, manages clinical negligence claims against public hospitals and doctors. At the time of its introduction, the then government decided it would have no retrospective effect. The scheme came into effect for hospital consultants from February 2004.
The Medical Defence Union contended the State should take over the historic liabilities of its members in respect of claims that occurred prior to the introduction of the scheme. It argued the introduction of the scheme deprived it of vital income to meet its historic liabilities in Ireland.
When no agreement was reached on this issue with the government, the organisation subsequently began to refuse cover to its existing and former consultant members in Ireland.
In late 2004 the Department of Health introduced an arrangement whereby consultants who were refused indemnity by the Medical Defence Union would have their cases handled to completion by solicitors nominated by their representative body.
At the end of proceedings, application could be made to the Minister for ex gratia assistance in relation to the payment of the settlement/award of damages and associated legal costs.
Ex gratia payments
Official figures obtained by The Irish Times show that since 2004 the State has made 145 such ex gratia payments at a cost of €47 million including legal costs.
The Department of Health said it was aware of a further 120 cases in which payment had not yet been made.
The Department of Health last week announced it had received €45 million from the Medical Defence Union in full and final settlement.
It has declined to estimate the total amount it will ultimately have to pay to deal with all negligence claims against members and former members of the Medical Defence Union. “The potential liabilities are comprised of the outstanding known claims plus a further possible exposure [contingent liability] of ‘incurred but not reported’ [IBNR] claims spread over a 10- 15-year period.
