MPI COVER – THE FACTS
SAOPA has become aware of a social media campaign that questions the decision by SAOPA to change the SAOPA-recommended malpractice insurance (MPI) cover provider from iToo to PPS Health Professions Indemnity. The purpose of this communication is to provide members with the facts in relation to some of the items raised.
Members are cautioned against making decisions based upon misleading information on social media and, specifically, chat groups. Comments are often emotionally charged, and it may be difficult to recognise vested interests that may exist. Furthermore, the provision of financial advice is strongly regulated in South Africa to protect consumers.
Below, we respond to several questions that members have been asking.
Why did SAOPA choose to change its MPI provider?
There were several pressing reasons for selecting an alternative MPI provider.
- The SAOPA Board became aware of administrative concerns that could potentially compromise its members if a claim were to be instituted. For example, no complete record exists of members who are insured on the group scheme.
- The proposed percentage increases in the previous provider’s premiums for 2020 were about 3% higher than the average headline inflation for 2019 and about 2% higher than the average tariff increases announced by the major medical schemes.
- CFP brokers indicated that their product was no longer exclusive to SAOPA members. This resulted in SAOPA’s value proposition to its members being undermined.
- It was considered a disadvantage that the iToo group scheme has some overall limits and deals with members as a collective when it comes to, for example, the overall annual group scheme limit. It is important to retain the collective bargaining power of the association while at the same time providing individual members with the best security possible.
What process was followed in appointing a new MPI provider?
Neither SAOPA nor its consultants are registered financial service providers. Accordingly, we procured the services of duly qualified and registered service providers. The medical liability market has seen a large-scale exodus of insurers and underwriters, but all available products that remain were evaluated. The advantages and disadvantages of each of the products were considered, and proposals were called for.
Some insurers declined the invitation to submit a proposal, and ultimately the SAOPA Board was left with two alternatives to choose from: the iToo product and the PPS Health Professions Indemnity product. The Board unanimously decided on PPS with due consideration of its mandate to act in the best interests of you as a member.
PPS Health Professions Indemnity is a new entrant to the market – does that not pose a risk?
It is indeed so that PPS Health Professions Indemnity is a relatively new entrant to the health professions indemnity market. Their entry into the market has been extremely successful, and they have already had a significant impact to the benefit of PPS Group members. The PPS Group has been providing financial products for graduate professionals since 1941 and has never launched a new initiative from which it later exited. PPS has a track record of being a conservative and conscientious financial services group that carefully investigates opportunities to serve its members before committing itself to a new offering.
What support will I get if I have a claim?
PPS Health Professions Indemnity’s philosophy is that professional indemnity claims are seldom the result of intentional or deliberate actions. As a result, any incident requiring assistance tends to be highly traumatic and stressful. Their objective will always be to support the practitioner throughout the process and to work towards an optimal outcome for all stakeholders.
PPS Health Professions Indemnity has employed some of the most senior and experienced professionals in South Africa. These professionals will support you throughout the process when called on for assistance.
Will you lose your retroactive cover?
The PPS Health Professions Indemnity offering provides retroactive cover to 1 January 2018, whereas the iTOO product offers retroactive cover to 1 January 2008. However, this was evaluated with reference to SAOPA members’ actual experience and looking at the actual litigation landscape.
- iTOO’s retroactive cover is subject to the insured providing proof of uninterrupted cover for the full period. Some of the administrative difficulties alluded to earlier present a risk to our members.
- PPS Health Professions
Indemnity considered all of the historical claims data. The following is of
- The average period between an incident occurring and a claim being submitted since 2016 ranges between a minimum of 13.1 days and a maximum of 47.4 days.
- The longest period between an incident occurring and a claim being submitted in any specific year since 2016 ranges between a minimum of 80 days and a maximum of 144 days.
- The risk of a claim occurring for services provided more than two years ago is extremely low based on this evaluation.
- The SAOPA PPS Health Professions Indemnity offering was consciously designed to provide an optimal balance between the risk exposure and the premiums payable. A longer retroactive period would have increased the premium without benefit to members.
Should an individual practitioner need additional retroactive cover because of the type of work that they do, they can arrange for such additional cover with PPS Health Professions Indemnity at a higher premium. It is therefore not necessary to remain with iToo if additional retroactive cover is required. This option has to be arranged at an individual level and will not be available as part of the standard SAOPA PPS Health Professions Indemnity offering due to cost implications.
What about the additional benefits that iToo offers?
Some of the so-called additional benefits being offered through the iTOO product are being emphasised:
- Defective products or workmanship: The provision of prostheses and orthoses – including the associated components, materials and manufacturing services – is part of the scope of practice of medical orthotists and prosthetists and, by extension, the professional services that they provide. As is to be expected, the services provided as part of your registered scope of practice should be included under your MPI cover, and the SAOPA PPS Health Professions Indemnity offering does indeed include it. In addition, most high-end components and materials carry supplier warranties.
- Public liability cover: Any practitioner who owns a practice should have short-term insurance that covers the contents of the practice. In most instances, public liability cover is automatically included in that insurance product, usually at a very low additional cost. Consequently, the inclusion of public liability cover in an MPI policy could result in a duplication of cover and costs.
Members should review their commercial short-term insurance policies to make sure that they are enjoying the necessary public liability cover via this more appropriate route.
Please be assured that the SAOPA Board and management are committed to acting as your custodians and always have your best interests at heart. The members of the Board are all in active practice and are also experiencing the discomfort associated with the changes that the profession and the association are going through at this time. We are working hard to address the issues at hand despite all the distractions. The Board also understands your frustrations with the slow progress in some instances, but we are working in an industry with multiple stakeholders, some with strong vested interests, combined with onerous legislative requirements. Many of the delays are outside the direct control of the Association.
You are encouraged to raise any concerns or questions that you might have with SAOPA at firstname.lastname@example.org or via the newly created WhatsApp chat facility on the SAOPA website. We will always do our utmost to provide you with well-founded answers. Your feedback is always welcome, as it helps bring to our attention any issues that we may not have been aware of before.