The Department of Health has published its consultation on fixed recoverable costs in clinical negligence claims, outlining its plans to limit them to cases worth up to £25,000 rather than the higher figure of £250,000 originally proposed. The Department released an announcement stating:
‘The government intends to impose a new, fixed cap on all clinical negligence cases up to £25,000 to prevent rising litigation costs within the NHS. There are numerous examples of lawyers who profit from the NHS by charging more than 80 times the amount awarded to the victims in minor claims.’[i]
The government has anticipated that the new cap will help the NHS save up to £45 million a year. The total bill for the NHS in the financial year 2015 to 2016 was £1.5 billion. Health Secretary Jeremy Hunt stated:
‘It’s important that when significant mistakes happen in the NHS, patients are able to have an open dialogue with a trust about what went wrong, receive reassurance of what is being learnt, and can discuss what form of recompense or redress may be appropriate. Legal action should only be one part of this process. Unfortunately, what we often see in lower cost claims is a deeply unfair system where unscrupulous law firms cream off excessive legal costs that dwarf the actual damages recovered. We believe this creates an adversarial culture of litigation, which is inflating insurance premiums and drawing away resource from the NHS at a crucial time’.
The consultation, which closes on 1 May 2017, has received criticism, although the new lower cap has been met with some relief. In particular The Association of Personal Injury Lawyers stated:
‘The fact that the government has decided to tone down its original plans will come as a relief to injured patients. A fixed-fee regime for more straightforward cases could be workable but the priority has to be the development of a quick and efficient system. It should then be possible to fix legal costs to reflect the speed and efficiency of the new process’.[ii]
It went on to say:
‘Above all, we need an end to the “deny, defend and delay” approach by medical professionals when something has gone wrong, which is all too common’.
However, elsewhere, The Law Society president Robert Bourns, remained sceptical of the proposals, stating:
‘We remain concerned that the draft plans could see harmed patients denied the correct level of compensation unless the proposed scheme excludes complex cases and includes exemptions for unusual circumstances. It is also critical that fixed costs are set at a level which is sustainable for expert solicitors to continue to operate in this area…There is a serious risk that those most affected by these proposals would be the vulnerable in society, such as the elderly and people who are disabled, whose cases can be complex and challenging but not necessarily the highest in value’.
The Department of Health has not put forward any proposed figures for the fixed fee, but is seeking views on the methodology that will sit behind them. There are four options, three based on an estimation of legal time required under a streamlined process, and the other based on current market costs.
We will continue to update readers on the progress of this consultation.
[i] Ministry of Justice, ‘Legal Firms Will Face A New Cap On The Amount of Costs They Can Recover In Negligence Cases’ (MoJ 30 January 2017)< https://www.gov.uk/government/news/plans-for-fixed-cap-on-legal-costs-for-medical-negligence-cases> accessed 2 February 2017.
[ii] Neil Rose, ‘Tentative Welcome By Some For Clin Neg Fixed Costs, But Others Blast Timing’ (Litigation Futures 31 January 2017)< http://www.litigationfutures.com/news/tentative-welcome-clin-neg-fixed-costs-others-blast-timing> accessed 2 February 2017.