The Medical Protection Society (MPS) has told the Justice Select Committee that legislation to deliver discount rate reform must progress swiftly in order to stem what it calls the unsustainable costs of clinical negligence.
The Justice Select Committee is running an inquiry into the matter following the Government’s proposed new framework for setting the discount rate in the future. In March this year the Government reduced the rate to –0.75%, a move that significantly increased the cost of compensation for clinical negligence. The MPS said that it also came at a time when costs were already at risk of becoming unsustainable.
In 2016/17 the NHS paid out £1.7 billion on claims, and since 2010/11 annual spend on dealing with clinical negligence cases has increased by 98%.
MPS said the current law, which determines how the discount rate is set, does not take into account the impact on the NHS, the public purse and the affordability of indemnity for healthcare professionals. It has welcomed plans to reform the way the rate is set but has expressed concern that it will take some time to implement while costs continue to rise.
MPS’s director of claims policy and legal, Emma Hallinan, who represented MPS and its members at the inquiry, said: “It is vital that the Government gets the framework right if we are to avoid further sudden shocks to the cost of compensation – the discount rate should provide a fair system for both claimants and defendants, ensuring that claimants are paid no more but no less than they should be.
“We believe the Ministry of Justice’s proposal strikes the right balance, and ensuring the rate is reviewed every three years would create greater stability. We also welcome the speed at which the Government has taken forward this draft legislation and the Justice Select Committee’s willingness to conduct this inquiry.
She added that it was essential that the Government introduced legislation soon after the Committee concludes its report.
“Without prompt action there is a risk that the cost of clinical negligence will become unsustainable for healthcare professionals, the NHS and to society,” said Hallinan.