According to a report by Aon South Africa, a risk advisory and insurance brokerage, medical malpractice claims are increasing. Aon notes that this due to South Africans becoming increasingly aware of their rights under the Consumer Protection Act (CPA), in addition to the rising number of legal professionals who are advertising medical malpractice litigation services.
“A contributing factor to the higher awards of many of these claims is the fact that many relate to children/infants where the repercussions and damages suffered are long-term. The need for professional indemnity (PI) insurance for private medical practitioners has never been greater, not only to protect the medical professional, but also patients in the event that something does go wrong,” said Malcolm Padayachee, manager of professional risks at Aon South Africa.
Zola Mtshiya manager of the marketing, branding and communications department at the Board of Healthcare Funders of Southern Africa (BHF), highlighted that it is not mandatory for doctors to have PI cover. However, she stressed that it is highly recommended in a litigious environment.
Aon highlighted that a majority of medical malpractice claims are from orthopaedics, neurology and obstetrics/gynaecology. Furthermore, the claim amounts have been increasing.
- Claims above R5 million have increased by 900% since 2009.
- One in every five claims are in excess of R1 million, a 550% increase over the past ten years.
- Some landmark claims have exceeded the R25 million mark.
- The Gauteng Department of Health is facing negligence claims of R1.28 billion for the 2012/2013 financial year.
Padayachee pointed out that certain classes of medical specialists are becoming uninsurable due to the high number of claims and settlements. This includes areas such as obstetrics. According to Padayachee, this results in a large number of practitioners either being unable or unwilling to pay the high premiums for PI cover.
Furthermore, commercial insurers are declining to offer medical professionals cover due to the higher risk. “In fact a number of local commercial insurers have withdrawn entirely from the PI market based on a reduced appetite for the growing risk in the medical malpractice space,” revealed Padayachee.
What is professional indemnity insurance?
This type of insurance provides the policy holder (the insured) with indemnity regarding legal liability that arises out the practicing their profession. This includes:
- The professional’s legal costs.
- Any compensation and legal costs that are due to the claimant up to the limit of indemnity of the policy.
Mtshiya emphasised that a doctor is at high risk and is personally liable should he/she be sued by a patient and not have sufficient PI cover.
“The problem of patient vulnerability is further exacerbated by the fact that South Africa currently has no legislation that makes it compulsory for medical professionals to take out PI cover. Although there were moves afoot in 2010/11 to make PI cover a statutory requirement by the end of 2012, this has not materialised. With an average annual premium cost of between R220 000 to R250 000 for a maximum of R30million liability cover adding to the running costs of an already cost-intensive medical practice for certain specialists, current estimates are that between 30-40% of medical specialists are practicing without cover. This means they are operating at high risk, and more importantly, leaving their patients exposed in the event that they suffer a loss as a result of negligence on the part of the doctor,” stressed Padayachee.
In addition, Padayachee emphasised that medical malpractice does not only occur in the public healthcare system where skills and resources may be at a loss, but also in the private hospitals and practices. Medical negligence can happen in any medical setting.
Medical skills in South Africa
Due to the growing concerns around legal liability and the rising cost of PI cover, the much needed specialist medical skills in South Africa are being negatively impacted. According to Aon, consumers are going to start carrying the brunt of these costs. This is due to the following:
- “The fear of litigation is seeing some doctors calling for more tests, many of them unnecessary, out of concerns of being sued, and in turn driving up costs,” said Aon.
- Graduates are choosing not to specialise in areas such as obstetrics, trauma, plastics, spinal/orthopaedic and even paediatrics due to the perceived high levels of litigation and risk, leading to a skills shortage.
- According to the CPA, doctors can also now be sued for faulty equipment, which they have no control over, thereby increasing their liability.
“It’s a lose-lose situation for all concerned. Aon’s view is that a statutory solution is urgently needed whereby government caps the limit of liability to an injured party to a certain level, as it has been done in the US and various European countries and in fact, this is exactly what was done with the South African Road Accident Fund. This will ensure that PI cover for medical practitioners remains sustainable and affordable, and that consumers are protected financially in the event of a successful malpractice claim. Ultimately, if the current situation persists the consumer stands the most to lose as the number of medical professionals will dwindle, consultation costs will increase dramatically as a result, and where a claimant has a legitimate malpractice claim, they could walk away without any compensation or a dramatically reduced settlement if their doctor has no PI cover in place,” added Padayachee.