A Real Fix not A Political Fix: Protecting the future of health care for practitioners and patients Julia Gillard - Shadow Minister for Health

Speech

Transcript - Medical Indemnity Forum, Sydney - 22 October 2003

Introduction

Thank you for the invitation today to address you on the crucial issue of medical indemnity. This is truly a case of perfect timing.

Today, we are seven weeks away from the 10^th of December deadline, set by the new Minister for Health, Tony Abbott, as part of his second political fix to deal with the medical indemnity crisis.

Of course, the first political fix was a desperate attempt to get the issue postponed for 18 months so the spectre of doctors walking out of public hospitals was put off until after the next election.

When that failed the Medical Indemnity Policy Review Panel was born and the clock started ticking. What we don't know today is whether the outcome of the Panel will be a more sophisticated political fix than Tony Abbott's first attempt, or a real solution to the medical indemnity crisis.

The crisis we are dealing with has been called the ‘perfect storm'. Merrilyn Walton, an Associate Professor in ethical practice at the Faculty of Medicine at the University of Sydney wrote in The Australian that:

Today's medico-legal environment involves powerful forces: uncertainty in medicine, medical mistakes, patients' desire for compensation and an antiquated negligence system. Add to this the collapse of medical insurance and high premiums, and we have a perfect storm.

Finding the solution to the ‘perfect storm' isn't easy and I am sure you recall the movie ended rather badly for all involved. Hopefully, today we can find a happier way of ending the ‘perfect storm' and the conclusions reached can inform the Medical Indemnity Policy Review Panel.

Medical indemnity – Howard Government Neglect

Until very recently, if you had raised the issue of medical indemnity with most Australians, you would have elicited a blank look. That changed with the collapse of United Medical Protection (UMP) last year and the recent action by doctors. Of course, actuaries, insurance experts, lawyers and medical professionals all knew plenty about the issue.

Back in 1991, the then Labor Government established a review of compensation and professional indemnity arrangements for health care professionals, headed by senior bureaucrat Fiona Tito. The report was handed to the then Minister for Health, Dr Carmen Lawrence in January 1996, barely a fortnight before Paul Keating called the election.

The Tito report, as it came to be known, provided a careful analysis of the arrangements in existence to provide for patients injured through negligence or misadventure. The report identified an array of major problems, including among others, that:

• Public data was not available on adverse events and negligence actions.
• Many treatments had an inadequate evidence base and were not sufficiently outcome-focused.
• Neither health professionals nor health care consumers had access to adequate information on the risks and benefits of treatment options.
• Patients did not have adequate access to their own health care records.
• The system was plagued by poor communication, particularly if an adverse event had occurred.
• Programs designed to improve quality were poorly designed and not sustainable.
• There was no guarantee of adequate government-funded assistance for people with severe disabilities, and the assistance provided was often poorly coordinated.
• Health care consumers faced significant difficulties in accessing the tort system in cases of negligence.
• There was no providential scrutiny of the MDO industry, allowing long‑standing inadequate funding of liabilities by medical defence organisations.
• There was no requirement for health care businesses to hold professional liability cover or cover for their institutional non-delegable duty of care, and laws pertaining to insurance requirements were unclear.
• There were concerns about the workforce effects of indemnity in specific areas of medical practice such as obstetrics.

This report was waiting on Minister Wooldridge's desk from the day he was appointed. When speaking at Melbourne University in April this year, Dr Wooldridge himself ‘fessed up and said proudly:

As Minister, I was accused of doing far too little on medical indemnity. That's completely unfair. I did absolutely nothing whatsoever.

The Crisis Hits

The medical indemnity crisis has been a long time coming, and developed in the context of a broader crisis in public liability and other forms of professional indemnity insurance.

In early 2001, HIH collapsed. HIH was Australia's second largest insurer and had won a large share of the market for certain classes of liability insurance, particularly public liability, through an aggressive strategy of cut-price premiums.

With the demise of HIH, the reduced supply of insurance and reinsurance led prices to rise even further. More disciplined underwriting by the few remaining firms offering indemnity insurance spelled the end of discount prices.

In September of 2001, the terrorist attacks in the United States forced the insurance industry to revise its underwriting practices. Insurance against terrorism disappeared. Premiums were increased to recover the estimated $US25 to $US30 billion (at least) in September 11 claims. These price increases were passed from reinsurers to Australian insurers to policyholders.

Meanwhile, medical indemnity prices for medical practitioners had been increasing for years. The Trowbridge report stated that total subscription income for MDOs has increased 30% since 30 June 1999.[i] In addition to these increases, members of most MDOs have been asked to pay a call.[ii]

Important structural problems lurked beneath the price rises. The Tito report stated that:

While there have been significant indemnity subscription increases, these are rather indicators that financial adjustments and changes are occurring in the MDO industry, that the subscription rates prior to these increases were probably too low to properly fund liabilities, and that the major cause of increases has been the move away from the previously universal principle of mutuality[iii].

In May 2002, UMP and its wholly owned subsidiary Australian Medical Insurance Limited (AMIL) went into provisional liquidation.

UMP/AMIL was the largest medical insurer in Australia. It provided coverage to approximately 60 per cent of medical practitioners nationally and 90 per cent in NSW.

UMP's capital reserves had foundered in the face of unprecedented large insurance payouts, a $30million loss arising from the collapse of HIH as one of UMP's reinsurers, a claims spike ahead of the introduction of the new Health Care Liability Act, and higher capital requirements imposed by APRA. The failure of its management to properly price products must also be acknowledged.

Faced with the imminent collapse of an indemnity giant, the Howard Government was finally spurred into action.

The Patch Up Political Fix Starts

Unfortunately, the actions taken look more like a series of bandaids rather than a cure.

The IBNR Levy

In the UMP wash-up, it also became clear that there was a problem with providing for so-called "incurred-but-not-reported" claims. In November 2001, UMP had had approximately $460 million worth of incurred but not reported claims (IBNRs), for which proper provision had not been made.

To assist the struggling UMP, the Commonwealth Government has agreed to take responsibility for UMP's IBNR liabilities. The catch is that the cost of this bail-out will be passed directly on to UMP's members and former members, via the now-infamous IBNR levy.

According to the plan, anyone who was a member of UMP as at 30 June 2000 would be billed for a share of UMP's estimate IBNR liabilities, every year for the next ten years.

It was the first batch of these bills arriving on doctors' desks a few months ago that triggered the recent, very public mass resignations, and left us in no doubt that the crisis in medical indemnity is not over yet.

Unfortunately, the scheme was a typical Howard Government, one minute to midnight, hastily thrown together, so-called solution.

The bills arrived with little in the way of courtesy or even information from the Government. With the final liability based on the number and size of claims yet to eventuate, there was no guarantee that next year's bill wouldn't be even higher, that the levy would be limited to ten years, or that money would be refunded if the liability was lower than expected.

Of course, some doctors were granted exemptions, and after loud public protests the list of exemptions has been expanded to include doctors:

• who work full time for a Government agency or public hospital;
• over 65 years of age;
• who have retired;
• who have died or ceased work due to incapacity;
• whose medical income is less that $5,000 a year;
• who were not practising medicine prior to 30 June 2000; and
• who have purchased comprehensive retroactive cover.

This is a reasonable list, and it's gobsmacking to think how ill-thought out the scheme must have been for the Government to issue bills of tens of thousands of dollars to doctors in these categories. It's been like pulling teeth, and we all know how the Government feels about providing dental services.

Even so, individual cases highlight the continuing problems and inequities evident in the ill-fated levy scheme.

The Member for Hasluck, Sharryn Jackson, told of a doctor in her electorate, working part time as a GP for the Royal Flying Doctor Service, who received a medical indemnity levy of almost $5,000. This doctor's gross part-time income for this year is only expected to be between $6,000 and $8,000, too high for an exemption.

The Member for Sydney, Tanya Plibersek, has advised that a children's orthopaedic surgeon in her electorate closed the doors of his private practice two months after receiving his $50,000 insurance bill because he could not pay it, let alone face a yearly IBNR levy of $23,000 for the next 10 years.

Despite evidence from the Australian Government Actuary that the data on which the levies had been calculated was out of date, the Government has continually refused to release their calculations, insisting that they are commercial in confidence.

Blue sky

The second patch was the blue sky claims arrangement. As a result of the hastily introduced Medical Indemnity (Prudential Supervision and Product Standards) Act 2003 commencing operation, medical indemnity cover must be provided through a contract of insurance.

This created a problem for doctors who expressed concern that moving across to insurance contracts would expose their personal assets to awards for damages where a claim against them exceeded the maximum amount that could be paid under the insurance contract.

In response to this concern, the Government announced its Blue Sky Scheme, which will assume liability for 100 per cent of any damages payable against a doctor that exceeds a threshold level of cover. The threshold will be $20 million and will apply to claims notified under medical indemnity contracts of insurance from 1 July 2003.

Premium Subsidies

The third patch is the Howard Government's premium subsidy scheme, which applies to neurosurgeons, obstetricians and procedural general practitioners and is designed to make medical indemnities more affordable. The Government has argued that these doctors have low incomes relative to premium costs, have faced very large premium increases and hence should receive the subsidy.

The subsidy will;

• pay 50 per cent of the difference between the cost of their premiums plus the IBNR contribution (if applicable) and the corresponding cost of medical indemnity premiums for gynaecologists, general surgeons and non-procedural GPs respectively who practise in the same state or territory and who have their medical indemnity insurance with the same MDO or insurer and whose income is in the same income band.
• for neurosurgeons, in light of the particularly high premium costs faced by some neurosurgeons combined with their relatively limited scope to derive income from private practice, the subsidy rate will increase to 80 per cent on that portion of their premium plus IBNR contribution (if applicable) that exceeds $50,000.
• for specialist obstetricians covered by Rural, Remote and Metropolitan Area classifications 3-7, the subsidy rate will be increased from 50 per cent to 80 per cent of the difference between the cost of their premiums plus IBNR contribution (if applicable) and the corresponding cost for gynaecologists who practise in the same state or territory and who have their medical indemnity insurance with the same MDO or insurer and whose income is in the same income band.

The High Cost Claims Scheme

The fourth patch is the Howard Government's plan to reimburse medical indemnity providers, on a per claim basis, 50 per cent of the insurance payout over $2 million, for claims notified on or after 1 January 2003. Essentially under this scheme, the Howard Government is providing reinsurance to medical indemnity providers.

This scheme should result in a downward pressure on premiums, particularly for doctors in high-risk areas by:

• lowering the amount MDOs have to pay out
• reducing the amount of reinsurance MDOs will need to buy to fund large claims
• limiting MDOs' exposure to large claims.

After months of refusing to budge, the Howard Government and the new Minister tried to introduce a moratorium so that medical indemnity would not be an issue until after the next election. For understandable reasons, the doctors did not fall for this and we now have the quickly created Medical Indemnity Policy Review Panel and the 10^th of December deadline.

What now needs to be done?

If the current process is to find its way to a real solution, then the process needs to work consultatively with all players and the real issues have to be on the table.

Disturbingly, a government that has blundered and blundered again in this area because of quick fixes borne out of crisis management, appears well on its way to repeating past errors by refusing to encompass the right people in the process. Clearly, state governments control two of the most important levers in this debate. First, State Governments control the tort law environment and secondly, they effectively indemnify doctors for their work in public hospitals. To take my home state as an example, in Victoria 60 per cent of claims for medical negligence against doctors are effectively paid out by the Victorian government.

Over the past eighteen months most state Labor governments have acted by making major reforms to the laws of negligence for civil and medical liability.

Anecdotal evidence suggests that these reforms are having a substantial impact on the number of claims against doctors for negligence.

Clearly, this only goes part of the way to resolving the medical indemnity problem.

After all there is only so much that can be achieved by active claims management and tort law reform.

But what Tony Abbott is now failing to do is to effectively engage the state governments and work with them to develop options to resolve this issue.

I note that his taskforce, the Medical Indemnity Policy Review Panel, makes no mention of working with the states on pulling together the data on these claims needed in order to develop options for effectively managing this complex and difficult issue.

If you don't have the data to understand the problem, how can you develop options to solve it?

Once again, in my home state the Bracks Labor Government has worked with the Medical Defence Association of Victoria (MDAV) and the Medical Indemnity Practitioners' Society (MIPS) and spent more than $250,000 on compiling a detailed actuarial assessment of all medical indemnity claims in both the public system and the private system.

I understand that the Victorian government now has probably the most comprehensive set of data on medical indemnity claims of most if not all governments in Australia.

This is exactly the type of database that the Federal Government needs to work towards establishing in co-operation with state governments and medical defence organisations. But Tony Abbott has set up a crisis management process that excludes the state governments. The process needs to be inclusive of state governments if it is to work.

And the process needs to be prepared to look at the real issues. Today, I want to briefly touch on four of the issues that must be considered:

• quality of care;
• open disclosure;
• the appropriate medical indemnity model; and
• the question of long term care costs.

Increasing Quality

The possible policy responses to problems of medical negligence and quality of care can focus on either changing the behaviour or entitlements of consumers or changing the practice patterns of providers such as hospitals or medical practitioners.

I am concerned that Tony Abbott's political fix will not address the latter. A very clear way to limit medical negligence claims and keep indemnity costs down is to limit the number of negligent incidences that occur. This is easier said than done as mistakes do happen, but we need to look very carefully at the management of clinical procedures and their follow-up and ensure the application of systematic and comprehensive clinical quality improvement processes, risk management programs and appropriate credentialing processes. By ensuring this occurs, the rate of adverse events will be lowered.

Indeed, some health experts such as Professor Stephen Duckett believe that the current focus on the ‘crisis in professional indemnity' is out of proportion to the size of the problem. He says negligence claims occur far less frequently than in the 4 to 5 per cent of hospital separations that have recorded adverse events. Focusing policy attention almost entirely on the restructuring of professional indemnity arrangements may then detract from more systematic action to strengthen the other aspects of accountability and improving quality of care. ‘Clinical governance' is a framework through which organisations are accountable for continuously improving the quality of their services and safeguarding high standards of care by creating an environment in which excellence in clinical care will flourish. We know that adverse events are unlikely to be reported if there is a massive financial incentive to hide the adverse event.

Quality improvements must encompass all aspects of the healthcare organisation's service delivery and must involve all healthcare providers. However, such a focus has traditionally not been there for the Commonwealth, given that States have operational responsibility for hospitals. That changed in 1995 with the public release of study on adverse events by the then Minister Carmen Lawrence. The study claimed that 6 in every 1000 hospital admissions ended in a preventable death associated with an adverse event. Professor Jeff Richardson, the Director of Monash University's Health Economics Unit, presented at the Australian Health Care Summit in Canberra recently and discussed the findings of the 1995 study in further detail. Using the 1995 percentage, he quantified it at 470 000 adverse events, 18 000 deaths per annum and 50 000 people with a permanent disability. Of the 18 000 deaths, he assumed 25 per cent or 4500 were preventable. On this basis, we have the equivalent of 13 jumbo jets crashing each year, each with 350 passengers. Even if we accept that this study reveals a particularly high level of adverse events because it took a broader ‘quality of care' approach rather than focusing strictly on negligence and compensation, the cost in terms of dollars and lives is too high.

What causes these adverse events? We know that human error is the cause of more than 70 per cent and the key categories are:

• Failure in technical performance;
• Failure to make decisions and/or act on available information;
• Failure to investigate or consult; and
• Lack of care or failure to attend.

Following the 1995 study, the Commonwealth and State Governments then moved to establish a national taskforce and an expert advisory group. In 2000, health ministers set up the Australian Council for Safety and Quality in Health Care (ACSQHC) with funding of $50 million over five years. We have also seen movement from the States, with NSW passing legislation this year and Victoria updating its Quality Council Plan earlier in 2003. Victoria's plan will establish a framework, ensure better data is collected and available, involve and educate consumers and respond to the problems as they are identified.

After only three years it is probably too early to judge ACSQHC's effectiveness. It has initiated a substantial number of programs including developing new guidelines, promoting safety as a component of medical education programs, trying to improve national data systems, distributing safety education material to doctors and other health care workers, and organising conferences. But achieving increased quality requires concerted effort, a willingness to reform and preparedness to look at resourcing questions. As the recent Australian Health Care Agreements negotiations proved, the Howard Government has not been prepared to take any of these steps.

Open Disclosure

A second policy response that focuses on changing the practice patterns of providers such as hospitals or medical practitioners is open disclosure, a strategy that seeks to prevent claims from ever arising. The principles of open disclosure are:

• Openness and timeliness of communication;
• Acknowledgement;
• Expression of Regret;
• Recognition of the reasonable expectations of patients and their support person;
• Staff support;
• Integrated risk management and systems improvement;
• Good governance; and
• Confidentially

The response of a consumer to an adverse event might vary and include:

• Seeking more information and understanding of what occurred and/or how the event came about;
• Seeking assurances that adequate steps have been taken to ensure that the organisation has learned from the poor experience of the patient;
• Blaming the organisation; and/or
• Exacting vengeance or seeking compensation.

Open disclosure means that when health services are better at addressing the first two, then there will be less of the latter two.

The Open Disclosure Standard has been approved by all health ministers and is an initiative of the ACSQHC. Open disclosure facilitates a factual explanation for the patient and their carers of what happened surrounding an adverse event, an expression of regret to the patient (which will require legislation in some States/Territories to clarify that an expression of regret is not an admission of liability) and steps to ensure the chances of such an event occurring again are eliminated or reduced. In such an environment, staff can learn from errors, take steps to rectify the problem and provide the feedback for the system as a whole. There is evidence this will also reduce the risk of litigation. Such changes will cover all services, be they provided in public or private systems and in all settings including hospitals and general practices.

However, open disclosure and adverse event notification alone will not achieve an improvement in care. A system is needed that uses the information generated by the adverse event notification that actively involves the clinicians and the team who provided the care in a process to learn from the experience to ensure there are system changes to reduce the likelihood of it happening again. This takes us back to the quality agenda.

Is the insurance model an appropriate one for medical indemnity?

Although there is general agreement that regulatory supervision of the medical defence industry is desirable and that the Australian Prudential Regulatory Authority is the best placed entity to do so, there is considerable disagreement about the model APRA has proposed for doing so and the very nature of the cover that should be offered.

Basically, APRA intends to replace MDOs with insurance companies or require MDOs to become insurance companies. Some MDOs are concerned that forcing them to become insurers is based on the false premise that there is no alternative.

The full costs of the APRA measures have not been fully identified by the Howard Government and, while their efforts have been focussed on improving the viability of UMP, the impacts on the industry more broadly have not been examined. The Allen Consulting Group report, conducted for the Medical Indemnity Protection Society in 2002, suggests that the additional costs for the re-configured medical defence industry are;

• Establishment implementation costs of $7 million;
• Operating costs of $55 million per annum; and
• Capital costs rising to $35 million per annum

The report says these costs are largely attributable to APRA's choice of corporate structure and most would not be incurred under "a framework that simply applied and raised capital requirements and other prudential controls. They are therefore avoidable."

The report also said:

"In particular, it would seem desirable to review the potential to bring the medical defence industry within a rigorous supervisory framework as intended by APRA, but without blocking continued involvement of MDOs structured as mutual funds and offering discretionary protection. This would preserve vigorous competition, enhance consumer choice and place the medical defence industry upon a genuinely sustainable position."

The APRA changes will block MDOs from continuing to operate unless they become insurers. The report concludes that implementation of the APRA measures will actually ‘break' rather than ‘fix' the medical protection product. MDOs use the approach of discretionary protection to promote best practice and manage risks proactively rather than passively, as is often the case with traditional insurance. For MDOs, discretionary protection is an effective means of dealing with the problem of ‘moral hazard' in insurance. Moral hazard refers to the tendency of insurance to change behaviour.

It is also far from clear that the APRA measures will place the industry on a sustainable footing. With few, if any, insurers willing and able to commit the substantial capital reserves required, there are doubts over this approach. Efficiency and lower premiums can only be achieved through strong competition and any less than the same number of insurance providers in the market as there are currently with MDOs must be seen as a failure of long-term sustainable competition.

MDOs currently provide protection to doctors over a wider range of areas than meeting legal costs and damages for medical malpractice. The scope of coverage that MDOs can become involved in is deliberately unlimited. They will protect any member in any circumstances where that protection has implications for the interests of members at large. If MDO models are made to conform to the insurance model, the scope of protection provided may shrink. Costs most likely will rise and doctors may be paying more for less.

The indemnity cover provided by MDOs is discretionary, is not an insurance contract and so is not covered by the protections that legislation applies to insurance. Commercial insurers have found it very difficult to compete in the medical defence industry and insurers are particularly worried about threats to viability including increased liabilities and uncertainty.

Given MDOs provide discretionary protection in exchange for subscription income from members, the ability of an MDO to withhold assistance to their members has been the subject of comment. After all, discretion implies that it is not binding in the manner that an insurance contract might be. In practice, however, MDOs must apply discretion in good faith and not act in an arbitrary fashion and denial of support to doctors is rare. The cases where protection has been denied almost always relate to a very small number of allegations regarding the involvement of MDO members in criminal activities. Indeed, many insurance contracts have a similar exemption.

There is also vigorous debate amongst MDOs as to whether the move to ‘claims made' protection is a wise one.

The Medical Indemnity (Prudential Supervision and Product Standards) Act 2003 (MIPSA) puts in place requirements regarding the provision of ‘retroactive cover' and ‘run-off cover'.

As a result of MIPSA and the prudential requirements imposed by APRA, MDOs will only be able to provide ‘claims made' cover. Where a doctor holds a ‘claims made' policy, they will be insured against injuries to patients brought about through conduct which took place during the term of the insurance policy, provided that the MDO is notified of the claim during the term of the policy.

This change was put in place to ensure that the IBNR problem does not recur. The difference between ‘claims made' and ‘claims incurred' cover is that for ‘claims made' cover, the claim must be notified during the term of the policy. As a result, the MDO has a far greater capacity for assessing its liabilities.

If a doctor holds ‘claims made' cover, and a claim is notified outside the period of cover, the doctor will not be able to seek indemnity under the policy. As a result, the doctor will be left uninsured and will be forced to pay for the claim out of his or her personal assets.

To ensure that the doctor is not left uninsured when they die, become permanently disabled or retire from practice, the doctor may take out ‘run-off cover'. Where a doctor holds run off cover, they will be insured against injuries to patients brought about through conduct which took place before the term of the insurance policy, but which was notified during the term of the policy. Therefore the doctors will be indemnified for claims that are notified once the ‘claims made' cover has lapsed.

However, doctors are already receiving advice about how to denude themselves of assets so that after retirement and the end of their ‘claims made' cover, they can avoid the need to buy ‘run-off cover' by ensuring they have nothing to lose if sued. Indeed, in many states of Australia there is the even more profound problem that being insured is not a condition of registration or practice so an asset-less doctor can simply rely on being ‘litigation proof'.

A resolution needs to be come to as to whether the ‘claims incurred' model is sustainable. Most would argue it is not but there are experienced professionals from MDOs, which have been well managed and which have no IBNR crisis, who vigorously put the other case. The matter needs to be resolved.

If the ‘claims incurred' model is not viable then there needs to be a resolution of what will be done to ensure that doctors and patients have some real protection when claims arise post-retirement. This may well require a move to ‘claims made' cover with claims post a doctor's retirement made against an Incorporated Nominal Defendant, which is jointly funded by working doctors through their premiums and their MDOs.

Long Term Care Costs of the Catastrophically Injured

While the Howard Government has been prepared to spend to resolve the medical indemnity crisis in its various patch ups, there remains unresolved the human issue of how we deal with and support the catastrophically injured amongst us. Philosophically, I am sure we would agree that however a person comes to have long term and profound disability, they should be entitled to quality care.

Currently, much of their entitlement depends on the circumstances which caused them harm.

The Commonwealth and the States need to work together to move beyond the normal boundaries that have hemmed us in to resolve the long term care issues for the catastrophically injured. This is an issue of clear importance to the medical indemnity debate but with important equity implications well beyond it. Fundamentally, we need to have an informed debate about who should be assisted, what assistance should they get and who pays.

Conclusion

The best solutions are found when people of goodwill sit work together to find answers. I view today's forum as a key part in finding a solution.

For too long, the issue of medical indemnity was ignored.

Then, the patch ups began.

Now we need to move beyond patch ups to a solution that passes the following tests:

• Is it sustainable?
• Does it provide certainty?
• Will it ensure the medical workforce is at work and focussed on patient care?
• Will it improve quality?
• Will it provide a solution for patients who have been harmed?

I wish you well in your labours during the day.

[i]. Gillian Harrex et al, Medical Indemnity in Australia, Presented to the Institute of Actuaries in Australia XIII General Insurance Seminar, Trowbridge Consulting, November 2001.

[ii]. Gillian Harrex et al, Medical Indemnity in Australia, Presented to the Institute of Actuaries in Australia XIII General Insurance Seminar, Trowbridge Consulting, November 2001.

[iii]. In regard to the principle of mutuality, historically, most medical defence organisations charged each member the same premium for cover. In recent years, concerns about cross-subsidisation have led to substantially increased premiums for certain specialist groups at high risk of claims or at high risk of large claims. Certain specialty groups have been levied premiums that are more than 20 times higher than the average premium for professional indemnity cover for doctors.