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‘Pointless’ fixed costs risk patient safety

Public backs fixed costs, poll shows, as Medical Protection Society calls on government to be ‘bold’

2 May 2017

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The Department of Health’s proposals to fix recoverable costs in low-value clinical negligence cases are ‘pointless’, draconian, and endanger patients, solicitors said ahead of the consultation’s closing date.

The consultation, which closes today, 2 May, proposes a fixed cap on the legal fees that can be charged for cases up to the value of £25,000 in England and Wales, which could result in £45m of savings to the NHS a year, according to the plan’s backers.

However, claimant lawyers argue that the proposals are flawed as they are based on inaccurate cost estimates, ‘fanciful’ time analysis, and the false premise that lower-value claims are less complex.

The Association of Personal Injury Lawyers president, Neil Sugarman, said it was ‘pointless’ to impose fixed costs for clinical negligence work without first fixing the process itself.

‘A fixed, predictable claims process needs to be developed, rather than imposing fixed costs on the existing, dysfunctional system,’ he said. ‘Taking an axe to how much the DoH pays does nothing to tackle the factors which drive costs, such as the ludicrously long waiting times for the recovery of medical records, or arduous expert reports.’

‘Of course, while an efficient process is important, we must not lose sight of the fact that the injured person is at the heart of the compensation system,’ continued Sugarman. ‘The DoH seeks to advance its own cause, as a negligent wrong-doer, by changing the way in which injured people can succeed and the costs they can recover. It’s like a criminal dictating the length of his sentence.’

In its response to the consultation, Hodge Jones & Allen has called for a move away from the current ‘delay, deny, defend’ culture that pervades NHS Resolution (formerly the NHSLA).

The current proposals, the firm said, do little to incentivise early settlement and instead build in an ‘inequality of arms’, with defendants benefiting from greater resources than claimants.

Agata Usewicz, head of medical negligence at HJA, said a failure to understand the work required to prove negligence in complex cases risks impacting patient safety: ‘There is a great deal of evidence to suggest litigation can drive the development of better practice, hold institutions accountable, and be a force for change.

‘It is not just about compensation that helps to rebuild lives; the process can identify systemic failings, ensure that sanctions are taken against poor and negligent doctors, promote early diagnosis, and lead to significant changes and improvements in healthcare. If important cases are not brought, patient safety will ultimately suffer.’

HJA also highlighted that a fixed costs regime should not be introduced until the impact of the Jackson reforms has been assessed. ‘Costs already have to be “reasonable and proportionate” before they are paid by the insurer or NHS and the courts rightly already hold the power to reduce any bill found to be excessive,’ said Usewicz.

‘To seek to introduce further and somewhat draconian changes without waiting to see whether the introduction of costs budgeting will lead to the necessary improvement must, from any angle, be considered to be somewhat misguided and misconceived.’

The firm has recommended the government put its proposals on hold until an independent review of LASPO has been undertaken and the findings of the latest National Audit Office investigation into NHS Resolution have been published.

However, a new YouGov survey of over 2,000 adults found that three-quarters of the public want the government to do more to reduce legal costs in clinical negligence cases.

The survey, commissioned by the Medical Protection Society, found that eight in ten respondents did not agree with lawyers receiving more money in fees than their clients in compensation. The same number supported the introduction of fixed costs.

The NHS paid out £1.5bn in clinical negligence costs in 2015/16, with legal costs accounting for 34 per cent of that bill. Damages totalled £950m, claimant legal costs £418m, and defence costs £120m.

Emma Hallinan, director of claims at the society, said: ‘Difficult decisions about spending in the NHS are made every day, and how we approach the spending of NHS funds on lawyer fees must be one of them. We fully support the introduction of mandatory fixed recoverable costs for claims of clinical negligence, and we understand the argument for not capping legal costs for the most expensive and complex claims, but we believe it is appropriate and viable to include claims up to £250,000.

‘Disproportionate legal fees are still a significant issue for claims up to this value – setting the threshold at £25,000 would help, but the financial benefits to the NHS and the taxpayer would be greater if the threshold were set at a higher level,’ she added. ‘We urge government to listen to the strong views of the public and be bold when making its decision on the threshold.’

John van der Luit-Drummond is deputy editor at Solicitors Journal

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

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medical negligence CLINICAL NEGLIGENCE FIXED COSTS low-value claims