The Government has announced it will move forward with its plans to introduce fixed recoverable costs and a new ‘streamlined’ process in clinical negligence claims up to a value of £25,000.
It said that it will place limits on how much lawyers receive from lower damages clinical negligence claims and will save ‘an estimated £500m over the next decade which could be spent on patient care’.
The changes will also ‘better support victims and preserve access to justice’, it said.
Last year, the Government consulted stakeholders and the public on plans to introduce a system of fixed recoverable costs (FRC) in ‘lower value’ clinical negligence claims (valued at £1,001 to £25,000).
However, medical protection experts told Pulse that to achieve the maximum benefit, a FRC scheme should be applied in claims up to the value of £250,000.
FRC are legal costs which can be recovered by the successful party from the losing party at a fixed sum and can relate to different stages of the civil litigation process.
Today the Government published its response to the consultation and also opened a supplementary consultation to address whether disbursements – legal costs incurred over and above claimants’ legal costs such as court fees – should be included within the fixed costs.
It said that the new process will ‘facilitate faster resolution for claimants and defendants at a lower, more proportionate cost’ than under the current system.
The new scheme will reduce legal costs reimbursed by public defendants, estimated to create £1bn in savings for NHS hospitals in England, and £1.3bn for other healthcare providers in the public and private sector, £2.3bn in total.
Changes to the original proposals, informed by the consultation, include:
- increased fixed costs at all stages of the process
- increased bolt-on amounts for claims involving protected parties and children, which will rise from £650 to £1,800
- giving defendants responsibility for neutral evaluation costs
- excluding certain claims from the scheme on grounds of complexity
In its response, the Government said: ‘We believe that the streamlined process we have arrived at, taking on board consultation responses, will be an important step forward.
‘It should facilitate quicker resolution so harmed people get compensation more quickly, make legal costs more proportionate and predictable, and make an important contribution to controlling rising clinical negligence costs for the NHS.’
Claimants and defendants, and their representatives, will also ‘benefit from improved predictability of cash flows’, the Government said.
Steven Davies, head of legal services at Medical Protection Society, said that MPS supports the principle of FRCs for clinical negligence claims and has long called for this reform, as part of a comprehensive strategy aimed at tackling rising costs.
He told Pulse: ‘FRCs carry the potential to increase transparency and proportionality for all parties, help to ensure more informed decision making with regards to pursuing legal action and could lead to more claims being settled without legal proceedings.
‘We have argued that to achieve the maximum benefit, a FRC scheme should be applied in claims up to the value of £250,000.
‘It is disappointing that the scheme will only apply to cases up to £25,000, however we are reviewing the detail within the Government response carefully to ascertain the impact on claims.’
Dr Claire Wratten, senior medical claim handler at the MDU, said: ‘We welcome that the government has finally responded to this much anticipated consultation, however, this development should only ever be seen as the start.
‘The MDU has always believed that for this scheme to have a meaningful impact on rising clinical negligence costs, it should be far more ambitious. Rather than just applying to claims up to £25,000, it should include claims up to £250,000.
‘However, this is an important first step given that disproportionate legal costs are one of several defects in the current litigation system and affect lower value claims.
‘In MDU cases, during 2022 the average sum paid in claimants’ legal costs on medical claims settled for up to £10,000 was over £24,000, while for claims settled between £10,000 and £25,000, the average was around £46,000.
‘It cannot be right for legal costs paid to claimants’ lawyers to regularly exceed the damages paid to claimants.’
Minister for health Maria Caulfield said: ‘We want a fairer system for victims of clinical negligence which provides speedier justice while also protecting NHS and taxpayer funding.
‘Those providing legal representation are due fair remuneration for providing these services but this should not be out of proportion to the claim or be to the detriment of justice or front line services.
‘By introducing fixed recoverable costs for clinical negligence claims of £25,000 or below, we’re ensuring a better balance between costs and compensation.’
The new consultation will not delay the implementation of the wider FRC scheme for lower damages clinical negligence claims and the Department of Health are currently working with the Civil Procedure Rule Committee to consider and implement the proposals set out in the response to the 2022 consultation.
The new rules are expected to come into force in April 2024.
NHS Resolution estimated that Covid-related clinical negligence claims alone would amount to £885m, £44m which could relate to general practice.
Last year, it also said that the number of clinical negligence claims made against GPs in England was ‘very low’ in the first year of the state-backed indemnity scheme.
Meanwhile, regional GP leaders at the LMCs conference had said that the BMA’s UK GP Committee should research a no-fault medical compensation scheme, following a ground-breaking legal case where a GP was successfully sued for failing to advise pre-conception folic acid.
Two cheers!
As the article points out, it would be good to see it apply to larger claims as well.
It needs to go further like New Zealand to discourage no win no fee have a go claims.