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Patients ‘failed’ by NAO report that blames claimant lawyers

Coordinated approach needed to rein in rising cost of clinical negligence claims

7 September 2017

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A long-awaited report into the impact of clinical negligence claims on the health service has been described as “extremely disappointing” and failing patients by continuing a narrative that lawyers are to blame for rising costs.

In a new report published today, the National Audit Office (NAO) finds that, over a ten-year period, the number of successful clinical negligence claims has more than doubled, from 2,800 to 7,300, while spending on the clinical negligence scheme for trusts has quadrupled, from £0.4bn in 2006-07 to £1.6bn in 2016-17.

This figure comprises £974m on damages, £602m on legal costs (£480m on claimants’ costs and £122m on defence costs respectively), and £10m on claims operations.

However, the report says that annual spending on clinical negligence claims is forecast to double to £3.2bn by 2020-21. The provision for existing or potential claims is £60bn.

The growing number of claims was found to account for 45 per cent of the overall increase in costs, while rising payments for damages and claimant legal costs accounted for 33 per cent and 21 per cent respectively.

The fastest percentage rise was in claimant costs, which was found mainly to be due to an increase in both the number of low- and medium-value claims under £250,000 and their average cost. In 2016-17, costs exceeded the damages awarded in 61 per cent of settled claims.

Factors that have contributed to the rise in costs awarded for high‑value claims include increased life expectancy, the rising costs of care, and the increasing time taken to report cases. Between 2006-07 and 2016-17 the average time between an incident and a claim being resolved increased from 6.6 years to 7.5 years.

Amyas Morse, head of the NAO, said: “The cost of clinical negligence in trusts is significant and rising fast, placing increasing financial pressure on an already stretched system. NHS Resolution and the department are proposing measures to tackle this, but the expected savings are small compared with the predicted rise in overall costs.

“At £60bn, up from £51bn last year, the provision for clinical negligence in trusts is one of the biggest liabilities in the government accounts, and one of the fastest growing. Fundamentally changing the biggest drivers of increasing cost will require significant activity in policy and legislation, areas beyond my scope.”

In a statement, Meg Hillier MP, chair of the Committee of Public Accounts, said: “The costs of clinical negligence claims are spiralling at a time of immense financial pressures on our National Health Service, taking scarce resources away from frontline services and patients.

“The Department of Health and Ministry of Justice have been too slow to work together to turn the tide, with actions to save £90m a year by 2020-21 a drop in the ocean in the face of forecast costs of £3.2bn a year by 2021. We need government to take a good hard look at the financial and personal costs of clinical negligence.”

However, speaking to Solicitors Journal, James Bell, a partner at Hodge Jones & Allen, said: “The NAO have approached this issue with a narrow focus and seem to have air-brushed out of history the recommendations it made to the NHS to reduce clinical incidents in 2001, preferring instead to give the organisation a clean bill of health. The reality is that little or no progress has been made by the NHS to bring down the cost or number of claims.

“The continued focus on claimant lawyers as a solution for all the NHS’s financial ills is misguided and disproportionate. Lawyers’ fees are already tightly controlled, capped, and limited due to recent reforms; they have to be ‘reasonable and proportionate’ before they are paid and the courts rightly already hold the power to reduce any bill found to be excessive.

“Delays caused by trusts and NHS Resolution can be unrelenting and are hugely distressing to clients. Often legal bills are massively increased as a result of the NHS’s failure to admit fault at an early stage and the way it conducts cases.

“While the narrative remains solely on claimant lawyers, nothing will change. The NAO has failed patients with this report.”

Also reacting to the report, president Brett Dixon, president of the Association of Personal Injury Lawyers, said: “We are just starting to see the impact of cuts to legal costs which will continue to streamline claimant costs significantly. But more savings could be made with cooperation on both sides to avoid unnecessary delays and additional work, rather than simply slashing claimant lawyers’ costs further or denying injured patients full compensation. In cases where fixed costs could be workable, the costs should be set to reflect a better procedure.

“Meanwhile, the NHS needs to put its house in order. 39 per cent of negligence claims are the result of harm caused by needless delays in diagnosis or treatment and more than twice a week someone has a foreign object left inside of them, including broken drill bits, surgical needles, swabs, and bags used for the retrieval of specimen. Let’s not forget that the overriding concern here should be the cost in human misery.”

Recommendations

The NAO has recommended that by September 2018 the DoH and MoJ clearly set out a coordinated strategy to manage the growth in the clinical negligence costs.

The strategy should, the report says, identify the balance the government will strike between access to justice and access to health services, and what is a proportionate response to harm.

The NAO also calls on NHS Resolution to promote better and more consistent data for complaints, incidents, and clinical negligence claims across the system and build its capability to analyse and provide greater insights on the causes of claims.

It should also work with trusts and the claimant law firms to better understand what motivates people to make a claim, and work more closely with the Solicitors Regulation Authority to “share information about trends and lessons learned from cases where costs have been challenged”.

John van der Luit-Drummond, deputy editor

john.vanderluit@solicitorsjournal.co.uk | @JvdLD

Categorised in:

Clinical negligence