Dr Jock Mackenzie provides the introduction to the Clinical Negligence: Mainly Claimant section of Chambers UK 2015:
In July 2014 the NHS Litigation Authority (NHSLA) published its annual Report and accounts for 2013/14. It makes for an interesting window into the current world of clinical negligence litigation.
According to the Report, there was an “unprecedented” increase in new clinical claims reported in the year of 17.9% (from 10,129 to 11,945). This figure is not dissimilar to the 20% increase in newly opened medical claims files in the Medical Defence Union (MDU) 2013 Accounts.
The Report states that this increase coincided with the Legal Aid, Sentencing and Punishment of Offenders Act (LASPO) coming into effect on 1 April 2013. It acknowledges (as does the MDU) that “the vast majority of claims reported to us throughout the year have been conducted under the pre-LASPO arrangements” due to a drive by claimant solicitors to sign claimants up to pre-1 April 2013 funding arrangements. As such, there could be a “one-off” explanation for this high increase.
However, it appears that the NHSLA also attributes at least part of the increase to a rise in non-specialist solicitors running unmeritorious cases having turned to clinical negligence following reduced profitability in the personal injury market. This may in part be due to the abolition of legal aid for all but birth injury claims and the introduction of Qualified One-way Costs Shifting (QOCS), the latter of which reduces the importance of After the Event insurance, and both of which can incentivise non-specialists into entering the market.
Having said that, in the two preceding years (2011/12 and 2012/13) reported claims increased by 5.6% and 10.8% respectively, perhaps suggesting a rising trend not explainable by just LASPO. (Interpreting the statistics before then is difficult because of a change in the methodology in claims reporting in 2010/11 which resulted in a 30% increase; claim numbers between 2003/04 and 2009/10 were fairly static.)
What the Report does not mention is that the National Reporting and Learning System (NRLS) reports an increase in adverse incidents in the NHS (excluding where the degree of harm is unknown) from 867,000 (2006/07) to 1,499,000 (2012/13). Even allowing for the gradual rise in the number of Trusts reporting, the continued increase in adverse incidents in the NHS might also help explain the increase in reported claims.
This increase was against a backdrop of a fall in the total expenditure on clinical claims for the second year in a row (2013/14: £1,192m; 2012/13: £1,259m; and 2011/12: £1,277m). Up until 2011/12, annual expenditure had been on the increase for at least a decade. The NHS annual budget is about £100 billion.
Of this annual expenditure, 70% was for damages to claimants (£840.7m), 22% claimants’ legal costs (£259.2m) and 8% defendants’ legal costs (£92.5m). The NHSLA’s Report laments the “excessive and disproportionate” costs claimed by claimant solicitors, whilst comparing and contrasting them to the much lower defence legal costs (a ratio of 2.8:1). However, it fails to draw attention to the fact that the figure for defence legal costs excludes the costs of claims managed in-house at the NHSLA and/or the Trusts, so a direct comparison is misleading. Further, it does not state that claimant legal costs fell by nearly 6% whilst defendant legal costs increased by nearly 21% from 2012/13. It also does not remark that panel defence lawyers can rely on an institutional paymaster for a steady stream of both work and income, whereas claimant solicitors have to spend time and cost marketing their services to obtain work and, nowadays, are paid primarily only if they win.
The Report further laments claimant solicitors ‘front loading’ work, and costs, prior to notifying the NHSLA of a claim, whilst implying that this is to avoid some effects of the new costs budgeting regime. However, it is not acknowledged that a claimant has to carry out often very extensive and expensive preliminary investigatory work, including costly independent expert opinion, just to establish whether a claim exists, which may help explain front loading. The Trusts and NHSLA can, and frequently do, do negligible work until receipt of a formal Letter of Claim; they also have access to “free” in-house medical opinion from the outset to assess risk and do not bear the burden of proof.
The impact of other changes remains unclear. Cost budgeting seems to be a time-consuming, work-intensive and costly process, with the added frustration for all concerned that it clogs up the court’s diary and causes delay. The procedural impact of the Mitchell litigation remains, albeit mollified by the Court of Appeal. The jury is still out on the full effect of the new proportionality rules.
The perception remains, though, certainly from the claimant side, that the civil justice reforms have reduced access to justice, especially for claimants with modest value claims, and this seems to be supported by a reported rise in litigants in person (Law Society Gazette, 3 April 2014). Whatever the underlying political agenda, depriving injured claimants of due redress is not the answer, nor is greater involvement of the private healthcare sector about which there continue to be concerns regarding, inter alia, reporting, regulation and accountability. However, it is not just the legal system that is being ‘reformed’: in the wake of various recent reports (eg Francis, Keogh, etc), the NHS is also undergoing change and this is to be welcomed, as patient safety and prevention of harm are what really matters.
All in all, the full extent of the fallout from the both the 2013 legal reforms and the ongoing healthcare reforms remains uncertain; however, what is certain is that this uncertainty in the clinical negligence and healthcare worlds is set to continue for some time to come, with both no doubt playing a role in the 2015 general election.
This introduction was published in Chambers Guide UK 2015.