The Irish Medical Organisation is to notify its members that any retrospective review of events, leading to the near €10m retirement settlement for its former chief executive George McNeice in December 2012, could cost up to €1 million or even more.
The union is expected to ballot its 5,000-plus members this month on whether to go ahead with the review.
The union's annual general meeting in April voted that the issue should be decided by a ballot.
The four-page circular to accompany the ballot paper said there is a strong possibility of a legal challenge to prevent the review taking place or to prevent members being told of its findings.
It also said that any review would not alter the settlement deal with the former CEO.
The IMO said that a review "may or may not be able to find out exactly how the mistakes of the past were made and who was responsible for them".
It said that once the votes are cast, the IMO will be committed to follow through on a course of action, whatever the cost.
The circular is signed by IMO President Dr Trevor Duffy.
The union warned that any legal challenges might prevent it from ever publishing the findings.
It also said any challenge might prevent the review from proceeding at all or lead to the IMO being sued for damages and substantially increase the cost of the review.
On the basis of tenders sought for the review, the IMO was advised it could cost €200,000 and possibly more.
The IMO has also stated that successive budgetary cuts have compromised patient care.
In its pre-Budget submission, the union said €4 billion has been taken out of the health budget since 2008.
This has resulted in 12,200 fewer staff, 900 fewer beds as well as increasing waiting lists.
Dr Duffy said there were widespread concerns among health professionals that the situation was at critical point and the union is calling for increased funding and staffing across all sectors.
Meanwhile, the IMO has suspended its ballot of consultants and non-consultant hospital doctors over new pay scale proposals for newly-appointed consultants, which were agreed at the Labour Relations Commission recently.
The union is awaiting confirmation from the Health Service Executive that it does not plan to cut the clinical director allowance, which some consultants have, for management roles.
The HSE said it would not be reducing the pay of any consultant holding a Clinical Director post.
It said it was disappointed to learn that the IMO has postponed its ballot of members in relation to the new pay scales.
