Archive for August 2014
My original piece – “NHS LITIGATION AUTHORITY: HOW IT MISLED PARLIAMENT”
One year ago I wrote about the 2010-2011 NHSLA Report to Parliament and suggested that its statement that “after large increases in previous years we saw new claims volumes for newly reported clinical claims rise by around 30% in 2010-2011″ was misleading and that the truth was very different. (Click here for original piece: https://kerryunderwood.wordpress.com/2011/08/25/nhs-litigation-authority-has-it-misled-parliament/ )
The press picked up on the NHSLA statement and lurid headlines followed with this being used as yet another example of the compensation culture.
I said then that “No such increase ever occurred” and that the true figure, based on other statistics was between 6.67% and 7.51%, an increase indeed, but consistent with previous increases.
The reason behind the apparent increase was a change in the reporting methods, something tucked away on Page 12 of the report, whereas the headline figure was contained in the opening statement of Mr Steve Walker, the then Chief…
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The Medical Defence Union provides indemnity to doctors, dentists and other healthcare professionals.
In July 2014 it said that the total bill for hospital claims could cost each taxpayer at least £1,000.00 a year if inflation continues at the current pace (Law Society Gazette 18 July 2014).
As I pointed out in my blog – The NHS Lying Authority At It Again, the total cost of claims in 2013/14 was £1.244 billion, that is £20.74 per UK resident.
Based on the inflation figures for July 2014, given by the Office for National Statistics on 20 August 2014, that is 1.6%, it will take 2,967 years on a straight line basis before the annual cost reaches £1,000.00 per person, that is the year 4981.
In fact the total expenditure by the National Health Service Litigation Authority on clinical negligence and non-clinical claims dropped in 2013/14 as compared with 2012/13.
Dr Christine Tomkins, Chief Executive of the Medical Defence Union, referred to an award of £9 million against one surgeon in one case and said that at the current rate of inflation that will have doubled in seven years. That is nonsense. Using the Consumer Price Index inflation figure for July 2014 of 1.6% it would take, on a straight line basis, 62 years, not seven years, for any figure to double. The actual rate over seven years will be 11.2%, not 100%.
How can someone in that position spout this rubbish? Why does the Law Society Gazette publish it without the sort of criticism that I am making here?
Extraordinarily the Medical Defence Union wants, in clinical negligence cases, a cap on the level of damages for future care costs and loss of earnings awards of three times the national average salary.
Thus a young high earner is paralysed due to clinical negligence and can never work again and needs permanent care. He or she would receive just £79,500.00 for loss of earnings for the rest of his or her life and a further £79,500.00 for future care costs, based on the current average earnings of £26,500 a year.
In fact such future care costs run to millions of pounds.
Such a limit would be immoral. It would also not bear scrutiny under Article 6 of the European Convention on Human Rights, the right to a fair trial, and would also be an unjustified deprivation of property contrary to Article 1 of the First Protocol to the Convention.
In any event the cost of looking after such a seriously injured person, in the absence of a proper damages award, would fall upon the state anyway. So nothing would be gained.
Why does the Medical Defence Union think that its members alone, of all the people in the United Kingdom, should have the consequences of their negligence limited in this way?
Why does the Medical Defence Union think its members should be above the law?
Does the Medical Defence Union propose this for all injuries, howsoever caused? If not, why not? I wonder how a surgeon catastrophically injured in a car crash would feel getting just £79,500.00 for future care costs for the rest of his or her life and just £79,500.00 to represent maybe 30 years loss of earnings.
Organisations like the Medical Defence Union give trades unions a bad name.
See my related blogs:-
The NHS Litigation Authority is at it again – doing what it is best at – misleading Parliament.
In its Annual Report to Parliament and accounts 2013/14, July 2014, the NHSLA states that it “dealt effectively with an unprecedented increase in claims” (Page 18).
That “unprecedented increase” was 17.9%, on the NHSLA’s own figures, in new clinical claims in 2013/14 as compared with 2012/13.
The Oxford English dictionary definition of “unprecedented” is:
“Adjective: Having no precedent, unparalleled; that has not previously occurred”.
In its 2010/11 report to Parliament the NHSLA said:
“After large increases in previous years we saw new claims volumes for newly reported clinical claims rise by around 30% in 2010/11 and by around 6% for non-clinical”.
How, on the NHSLA’s own figures is 17.9% “an unprecedented increase” when, on the NHSLA’s own figures the increase in 2010/11 was “around 30%”?
In my blog NHS Litigation Authority: How it misled Parliament I demonstrated that there was never any such increase and that the true figure was around 7.5%.
Now it is true that based on the true previous figures a genuine increase of 17.9% may indeed be “unprecedented” but the NHSLA has never resiled from its misleading earlier report. By its own figures the NHSLA was lying then or is lying now.
Any which way let us assume that there has been a 17.9% increase; that is undoubtedly significant. May there be an explanation other than a rampant, solicitor fuelled upsurge in compensationitis?
Yes, actually. Tucked away on page 18 appears:
“This significant increase in the number of claims coincided with the Legal Aid, Sentencing and Punishment of Offenders Act (LASPO) coming into effect on 1 April 2013. This legislation, including changes to “no win – no fee” arrangements, stopping claimant lawyers charging up to 100% success fees on their costs and banning referral fees.
Prior to LASPO, we saw significant marketing campaigns by claimant solicitors to ensure claimants signed up to pre-LASPO no win – no fee arrangements, which still enable claimant solicitors to charge a success fee on their costs. As a result, the vast majority of claims reported to us throughout the year have been conducted under the pre-LASPO arrangements”.
Quite. Thus there has been an acceleration of claims, but not necessarily an unusual or “unprecedented” increase over and above the usual 7% to 10% annual increase.
Incidentally in its 2010/11 report the NHSLA said this:
“We are delighted that the Ministry of Justice is taking forward the recommendations made by Lord Justice Jackson regarding the costs of civil litigation. We believe very strongly that a regime which allows success fees and the recoverability of after-the-event (ATE) insurance premiums makes litigation so profitable that solicitors and so-called “claims farmers” are drawn into the market thereby fuelling the rise in claims volumes we have experienced”.
Be careful what you wish for.
The Report itself recognizes that this is likely to be a one-off distortion.
“In the shorter term the introduction of LASPO has increased the number of claims received by the NHS under pre-LASPO funding arrangements” (Page 27).
It appears not to occur to the NHSLA that even this relatively modest increase may be caused by increasing negligence by what is at times a dysfunctional body. No negligence = no successful claims.
Next year’s report is easy to forecast. Claims will be up again and the given reason will be that Qualified One Way Costs Shifting allows anyone to bring a claim free of risk.
Oh, in case you did not notice it among the hysterical headlines the total expenditure by the NHSLA on clinical negligence and non-clinical claims dropped in 2013/14 as compared with 2012/13.
One of those hysterical statements was from the Medical Defence Union that hospital claims could cost each taxpayer at least £1,000 a year if inflation continues at the current pace.
In 2013-14 the total cost was £1.244 billion, that is £20.74 per UK resident.
I won’t work out the cumulative effect of inflation but at a straight 3% the cost will rise by 62p per year and it will take 1,613 years before the annual costs will reach £1,000 per person, that is the year 3627.
How about you stick to medicine and leave the truth to lawyers?
This piece was prepared by Leah Waller, Assistant Solicitor at Underwoods Solicitors –
Victims of mesothelioma unable to trace an insurer for the employer responsible for the exposure to asbestos were left without a remedy until the passing of the Mesothelioma Act implemented by The Diffuse Mesothelioma Payment Scheme Regulations 2014 S.I. 916 made under section 1 and section 17(4) of the Act.
Eligible individuals may now apply for compensation packages worth an average of £123,000.00.
This Payment Scheme compensation has increased, as of 1 July 2014, in accordance with The Diffuse Mesothelioma Payment Scheme (Amendment) Regulations 2014 S. I. 917. The maximum award from 1 July 2014 is £216,896.00. The awards under The Diffuse Mesothelioma Payment Scheme (Amendment) Regulations 2014 have increased by an average of £8,000.00 as compared with the awards under Schedule 4, Table 1 of The Diffuse Mesothelioma Payment Scheme Regulations 2014.
The maximum award, from 6 April 2014 to 30 June 2014, was £203,778.00. (Schedule 4, Table 1 of The Diffuse Mesothelioma Payment Scheme Regulations 2014).
The full impact assessment was produced for the Mesothelioma Bill and this stated that the
“scheme payment includes an amount to cover applicants legal fees…this assumption has been moved back to £7,000.”
This assumption, however, has not been made clear in either The Diffuse Mesothelioma Payment Scheme Regulations 2014 or The Diffuse Mesothelioma Payment Scheme (Amendment) Regulations 2014 as no reference to legal fees is made.
However the Frequently Asked Questions on the Government website for the Diffuse Mesothelioma Payment Scheme states the following:-
“Who pays my solicitor’s fees?
If your application is successful, the Scheme will pay you a fixed fee of £7,000 out of which you can pay your solicitor’s fee. If you incur legal costs of less than £7,000 you are entitled to keep the difference. If your legal costs exceed £7,000, you will be liable to make up the difference.”
Thus it is obviously the Government’s intention to pay a contribution of £7,000.00 towards the victims legal fees from the payment that they are awarded and indeed the table, presenting the compensatory award is headed with a paragraph stating:-
“The amounts quoted in the table below include a £7,000 contribution to legal fees.”
The table referred to is a copy of the table set out in The Diffuse Mesothelioma Payment Scheme (Amendment) Regulations 2014.
Various conditions must be met:-
- the victim must have been “first diagnosed with the disease on or after 25 July 2012.” (section 2(1)(b));
- the victim must not have brought an action for damages in respect of the disease against the relevant employer or any insurer with whom the employer maintained employers’ liability insurance at the time of the person’s exposure to asbestos; (section 2(1)(c));
- the victim must not have received damages or a specified payment in respect of the disease and must not be eligible to receive a specified payment; (section 2(1)(e));
- the person must be “unable to bring an action for damages in respect of the disease against any employer of the person or any insurer with whom such an employer maintained employers’ liability insurance (because they cannot be found or no longer exist or for any other reason)…”; (section 2(1)(d));
The Department for Work and Pensions estimates that 3,500 victims or their families qualify immediately.
The Mesothelioma Act, The Diffuse Mesothelioma Payment Scheme Regulations 2014 and The Diffuse Mesothelioma Payment Scheme (Amendment) Regulations 2014 make no reference to other diseases caused by asbestos such as asbestosis or pleural thickening.
Success Fees and After-the-Event Insurance Recoverability in Mesothelioma Claims
The recoverability of a success fee in mesothelioma claims is yet to be abolished and the Mesothelioma Act, The Diffuse Mesothelioma Payment Scheme Regulations 2014 and The Diffuse Mesothelioma Payment Scheme (Amendment) Regulations 2014 do not deal with the implementation of section 48 of Legal Aid Sentencing and Punishment of Offenders Act 2012 in relation to sections 44 and 46 of Legal Aid Sentencing and Punishment of Offenders Act 2012, which would abolish the recoverability of a success fee from the Defendant.
Section 48 of Legal Aid Sentencing and Punishment of Offenders Act 2012 requires that the Lord Chancellor carries out a review on the likely effect of sections 44 and 46 in relation to mesothelioma claims and publishes a report on the conclusions of this review before sections 44 and 46 can be brought into force in relation to mesothelioma claims. This report was published on 6 March 2014.
The Government has concluded that it is right to commence sections 44 and 46 of the Legal Aid Sentencing and Punishment of Offenders Act 2012 for mesothelioma cases and proposes to synchronise the commencement of those sections with the making of the compensation payments under The Diffuse Mesothelioma Payment Scheme Regulations 2014 and The Diffuse Mesothelioma Payment Scheme (Amendment) Regulations 2014, see paragraph 119 of the Government’s response. This has not happened and no Commencement Order has been passed in order to abolish the recovery of success fees in mesothelioma claims.
The commencement of sections 44 and 46 will be implemented by way of a Commencement Order under section 151 Legal Aid Sentencing and Punishment of Offenders Act 2012.
The proposal to abolish recoverability of the success fee and the After-the-Event insurance premium is subject to Judicial Review proceedings, heard on 29 and 30 July 2014, brought on behalf of the Asbestos Victims’ Support Groups Forum UK. Judgment will be handed down on 2 October 2014.
In any event the Government has indicated that abolition will not take place until December 2014 at the earliest.
The Government has decided not to proceed with the fixed fee scheme set out in its consultation paper – Reforming Mesothelioma Claims.