Jeremy Hunt, the Health Secretary, has said that the Government intends to impose a new fixed cap on all clinical negligence cases that are worth up to £25,000.
The Government has released a 12-week consultation on introducing fixed fees which it says will improve the efficiency and cost-effectiveness of clinical negligence claims by supporting quicker and more cost effective resolution for all parties. It has also said that the proposal will give the NHS greater opportunities to learn lessons from harmful incidents.
Hunt said that a cap was needed to clampdown on rising litigation costs within the NHS. In a press release, the Department of Health said that there have been “numerous examples of lawyers who continue to profit from the NHS” by charging “more than 80 times” the amount awarded to the victims in minor claims.
In the release, it highlights one case where lawyers claimed £83,000 in legal costs for a case in which the patient was awarded £1,000. The costs contributed to a total bill for the NHS of £1.5 billion in 2015/16.
There is no current limit on legal costs that can be recouped and the Government has said that the money claimed by lawyers takes vital funds away from NHS trusts. It expects the new cap to help the NHS save up to £45 million a year.
“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,” said Hunt.
“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.”
Emma Hallinan, director of claims at the Medical Protection Society, said that the cost of clinical negligence risks was becoming unsustainable for the NHS and society.
“We are pleased Government is tackling this important issue; a package of legal reforms is desperately needed. Introducing fixed recoverable costs for small value claims could play a part – helping to ensure that legal costs do not dwarf compensation payments, and that money can be spent on patient care instead.”