Fixed recoverable costs (FRC) for clinical negligence cases worth up to £25,000 appear to be on the way after the Department of Health commissioned the Civil Justice Council (CJC) to set up a working group on how they could be introduced.
Leading defendant insurance lawyer Andrew Parker has been named chair, with David Marshall vice-chair.
Mr Parker is head of strategic litigation at DAC Beachcroft, with a wide-ranging agenda across injury claims. He is also a former president of the Forum of Insurance Lawyers and a current solicitor member of the CJC, which is why he is the chair.
Mr Marshall, managing partner at south London firm Anthony Gold, is a clinical negligence lawyer and former president of the Association of Personal Injury Lawyers. He currently chairs the Law Society’s civil justice committee.
The CJC said further membership of the group would be announced in due course.
The terms of reference are:
- To consider and recommend an improved process for clinical negligence claims, where the claim has a value of £25,000 or less;
- To draw up (i) a structure for FRC for such cases to attach to the new process, (ii) figures for FRC in the proposed structure, and (iii) figures for the cost of expert reports;
- To have regard to how any improved process or scheme of FRC might affect issues of patient safety, including the way in which case outcomes are reported back to healthcare providers for learning purposes;
- To consider how expert reports should be commissioned and funded, including the feasibility of single joint experts for at least some claims, as part of the improved process;
- To report with recommendations by the end of September 2018.
The appointments follow the Department of Health’s response to its consultation paper on the issue, which was issued last January.
In all, 167 responses were received to the consultation, many from claimant lawyers, and overall 58% opposed mandatory FRC – rising to 85% of claimant lawyers. This fell to just 14% of defendant lawyers and 40% of lawyers doing both claimant and defendant work, although the number of responses in each of these categories was small.
The DoH response said: “To add to the complexity, a range of additional feedback was provided around the proposed design and implementation of FRC. This suggests that most respondents – whether they support or oppose FRC – have identified specific aspects of the proposal that they would like to consider further.
“This was evident in the responses with details such as the most appropriate methodology for setting rates, the method for implementation, and most of the eight constituent parts of the Civil Procedure Rules all garnering no overall agreement or disagreement from those responding.
“There were also frequent calls for a working party to be established to more fully consider how FRC could work in practice if introduced. This is something that the department has agreed to take forward as the most appropriate mechanism to engage all stakeholder groups in the design of a potential FRC scheme.”
The DoH said it did not have a preferred methodology for setting the FRC. The response said: “If a FRC scheme is introduced, whatever methodology is employed to set the rate, it is important that patients continue to have the option of taking legal action where something has gone wrong with their care.
“The level at which the rates may be set will be very important in guaranteeing this – through ensuring that claimant lawyers are not deterred from taking on these cases, balanced with the need to consider delivering savings and protect scarce NHS resources for frontline delivery.
“In addition, any FRC scheme could seek to incentivise parties on all sides to work towards earlier resolution and create a less adversarial climate.”
The creation of the working group was in line with Lord Justice Jackson’s recommendation last year in his fixed costs report, and the DoH said mediation will be employed in areas of specific disagreement. “LJ Jackson has offered to adjudicate if necessary.”
The DoH’s press release was less measured than the response, with the headline “Experts to work on capping rip-off NHS legal costs”.
It continued: “There is currently no limit on legal costs that can be recouped and the money claimed by lawyers takes vital funds away from frontline patient care at a time when the NHS is under pressure – an unnecessary waste adding to the growing clinical negligence bill which topped £1.6bn in 2016/17.
“There are numerous examples of lawyers charging more than 80 times the amount awarded to the victims in minor claims. In one case, lawyers claimed £83,000 in legal costs for a case in which the patient was awarded £1,000.
“The proposed cap will be applied to all cases up to £25,000 and will help to save the NHS up to £45 million a year.”
Health and social care secretary Jeremy Hunt said: “When things go wrong, we need a system that is just for those who have suffered but also just to other patients, both in terms of making sure we learn from mistakes and also pay legal costs in a proportionate and reasonable way.
“However, sometimes we end up paying legal fees that are much, much higher than the actual damages incurred – which may be good for lawyers, but is a terrible use of money that could be spent on patient care.
“This should not obscure the simple truth that the biggest way to cut negligence costs is to reduce patient harm in the first place, which is why we will continue a relentless focus to make our NHS the safest healthcare system in the world.”
Claimant lawyers’ general reaction was that the real goal had to be avoiding clinical mistakes in the first place.
Brett Dixon, president of the Association of Personal Injury Lawyers, accepted that there was “scope to streamline the procedures and cost involved in lower-value claims”, but said this was only part of the story.
“The urge to streamline costs and procedures must go hand in hand with a real, systemic, consistent reduction in avoidable injury. Only then will the NHS become more efficient, and only then will we see an end to the needless suffering of patients.”