The current economic crisis has generated a lot of criticism of the position of public sector workers and in the world of planet insurance, one group of employees could be exempt from the pain of the recession until 2011 - GPs who receive fees for medical reports on their patients.
Back in 2006, a new fees agreement was set in place.
It was a time of huge rises in GP's NHS incomes. The Government had introduced a fees system which gave large pay increases to GPs who met targets. Funnily enough, as a group, they pretty well met them all. The result was a pay increase of over 30%. For historic reasons (the previous long term clamp down on public sector pay) the fees for GP reports were linked to GP pay and not inflation. The agreement made in 2006 absorbed the 30% over five years - and is still running.
This April fees will go up again from £84 to £89 and again next year to £94.30 - when the agreement is up for review for 2011. The agreement does contain the option for review by either side at any time - and would then remain in force for another six months, or until a revised rate is agreed whichever is sooner.
Given the current economic environment, it might be time to pull the plug. So what could happen if the industry did do this? The past record of a 'free market' is not good. This is because GPs had a monopoly of patient information; insurers must have it to underwrite; GPs worked together to drive up fees, and insurers paid up and up and up... And today, the need for information held by GPs is underlined by the guidance on non-disclosure which rules out using information later that could have been reasonably obtained at the time of application (ie if a patient declares a heart condition, the insurer is on notice to find out its severity).
Lack of an agreement did not actually mean a free market - it was a monopoly with absolute power acting against individual insurers with virtually no power.
But look a little deeper - the monopoly is under threat from patient e-records systems. Many are already being trialled in surgeries across the UK. These can allow easy access to records by patients and can also be held by data companies and public sector organisations - the GP surgery, the NHS Trust, private companies specialising in data management etc. Once the monopoly disappears, an agreement between the British Medical Association (BMA) and the Association of British Insurers (ABI) becomes illegal under competition law - and collusion by GPs or insurers to set rates will be viewed as acting as a cartel.
Whatever happens regarding an agreement in the next year or two, the concept is time limited.
Right now, there is probably little to be gained by a head on collision with the BMA. The lever for change is not the recession (however reasonable this may seem), or the power of the industry to drive down rates through a new agreement (what power?). Rather, it is the end of the monopoly. Now is the time to prepare for a real free market in medical information - subject to patient consent to access of course.
Richard Walsh is managing director of SPPR Consulting
