Written evidence submitted by The Association of Consumer Support Organisations (ACSO) (NLR0028)

The Association of Consumer Support Organisations (ACSO) welcomes the opportunity to respond to the Health and Social Care Committee call for evidence on National Health Service (NHS) litigation reform

ACSO was established in January 2019 to represent the interests of consumers in the civil justice system and the reputable, diverse range of organisations who are united in providing the highest standards of service in support of those consumer. Its role is to engage with policymakers, regulators, industry and the media to ensure there is a properly functioning, competitive and sustainable civil justice system for all consumers. The Health and Social Care Committee’s call for evidence on NHS litigation reform is therefore of direct relevance to ACSO’s work.

Q1. What is the impact of the current cost of litigation on the financial sustainability of the NHS and the provision of patient care?

The cost of litigation and its impact on the financial stability of the NHS should be viewed in the context of sharp increases in the overall budget for the health service. Since it was established in 1948, the NHS has seen average annual budgetary rises of 3.7 per cent.[1] Moreover, in 2020 the public healthcare spending of gross domestic product (GDP) in the UK rose to 10.43 per cent, a significant increase from 7.97 per cent in 2019. Given population increases, demographic changes, healthcare demand, inflation and overriding, cross-party political sentiment, there is little doubt it will rise further still in future.[2]

In 2020/21, planned spending for the Department of Health and Social Care (DHSC) was £212.1bn, up from £150.4bn in 2019/20.[3] This includes more than £60bn of additional funding for the DHSC response to the Covid-19 pandemic.[4] In September 2021, the government announced approximately £12bn of additional spending for DHSC for each year between 2022-23 and 2024-25, the bulk of which is earmarked for the health service.[5]

In 2020/21, liabilities arising from claims under all of the NHS Resolution (NHSR) indemnity schemes totalled £82.8 billion, a slight decrease of £1.3 billion from the previous financial year (£84.1 billion) because of the lower levels of clinical activity that took place in 2020/21 owing to the Covid-19 pandemic.[6] Likewise, the cost of settling claims in the 2020/21 financial year reduced across all schemes by £120 million, to £2.26 billion.[7]

Although the cost of litigation is not inconsiderable, it arises chiefly owing to failures in patient safety. A 2001 study concluded that between 8–10 per cent of NHS hospital admissions involve an adverse event, resulting in harm to the patient.[8] Between half and one third of these adverse events are thought to be preventable.[9] Reducing avoidable error must take top priority. There is a need to hold medical professionals to account for any breaches in the duty of care they owe to patients; the financial cost to the NHS should come second to the human impact.

Consumers can only make claims for clinical negligence if they can show that a medical professional has indeed failed in their duty of care to them as a patient by not acting in the manner expected of them, and that damage or loss was experienced as a result. This can include both physical and psychiatric injury, as well as financial loss.

To prove medical negligence, the burden of proof lies with the claimant. The burden of proof is considerable. For this reason, ACSO members who take on clinical negligence work will reject approximately 90 per cent of the potential cases they are approached with by consumers. Of the cases that are pursued, a similar proportion - approximately 90 per cent - are successful. These numbers reflect the significant harm claimants and their families will often have suffered as well as the determination their representatives will have not to pursue cases that are unmeritorious.

Furthermore, recent decades have seen a rise in consumer awareness of their rights, of legal issues and of the operation of the legal system.[10] For example, a survey conducted by the Legal Services Board (LSB) found that nearly three in four (74 per cent) respondents said they understood their rights and responsibilities at the time a legal issue arose.[11] This awareness inevitably leads to higher rates of litigation, including against the NHS. In regard to the government’s long-stated intention to introduce fixed recoverable costs (FRCs) for clinical negligence claims, it should ask whether it is appropriate to attempt to drive down legal costs by eroding the fundamental right of access to justice. This is considered further in our answer to question 3.

In discussing whether the cost of litigation against the NHS may lead to its financial instability, and that this therefore means it must somehow be reduced or eliminated entirely, one may forget that individuals or groups claiming compensation may have suffered considerable, sometimes life-changing harm. If that is the case, then widespread affection for the NHS should not mean it is immune from criticism. As Dr David Berger, a former NHS General Practitioner (GP), explains, the NHS cannot be “meaningfully managed and steered until it is somehow brought down off its pedestal in the UK psyche and viewed as what it is: no more or less than an administrative mechanism to deliver healthcare”.[12]

Q2. What are the key changes the government should consider as part of its review of clinical negligence litigation? In particular:

• What changes should be made to the way that compensation is awarded in clinical negligence claims in order to promote learning and avoid the same problem being repeated elsewhere in the system?
• How can clinical negligence processes be simplified so that patients can receive redress more quickly?
• How can collaboration between legal advisors be strengthened to encourage early and constructive engagement between parties?
• What role could an expanded Early Notification scheme play in improving transparency and efficiency system-wide?
• The government has reiterated its intention to extend fixed recoverable costs, which limit the amount that can be paid out to meet legal costs, to clinical negligence cases with settlements of less than £25,000. At what level should these fixed recoverable costs be set, and are there any circumstances in which they should not apply to low value clinical negligence cases?

Since 2015, the government has stated its intention to introduce FRCs to help control the overall cost of compensation in cases against the NHS in England and Wales, in line with Sir Rupert Jackson’s overall ambitions in civil justice cases.[13] A pre-consultation exercise in July - August 2015 followed, with the Law Society, leading claimant and defendant firms, NHSR and Department of Health officials discussing the plans and formulating potential FRC models. The full consultation appeared on 30 January 2017, and the summary of responses and Professor Paul Fenn’s cost analysis were not published until February 2018, by which time the minister in charge of the reforms, Ben Gummer, had departed from the House of Commons following the 2017 general election.[14]

Many respondents to the 2017 consultation opposed the government’s proposals, stating they represented a substantial threat to access to justice and patient safety. Moreover, a letter was sent from nine national charities asking for the proposals to be dropped as “some of the most vulnerable people harmed by clinical negligence would not be able to achieve justice because they would not be able to find solicitors to represent them.”[15] Nevertheless, in the summary of responses, the government announced that a sub-committee of the Civil Justice Council (CJC) would undertake further work with a view to publishing recommendations in autumn 2018.[16] This group, chaired by Andrew Parker, a CJC member and head of strategic litigation at defendant firm DAC Beachcroft, failed to reach agreement on the level of FRCs, with its report of October 2019 suggesting a further government consultation would instead be required.[17] This has yet to be published.

There are some core principles which should be noted. Clinical negligence damages give patients restitution to compensate them for loss. They are not, as sometimes described, some sort of windfall but rather the amount judges have agreed are required to help patients rebuild their lives. Each claim taken forward is also critical to the career of the medical practitioner involved, needs to be considered properly and will require at least one dedicated expert witness.

Fixed costs for ‘low value’ clinical negligence could see harmed patients denied the correct level of compensation. This is because identical cases of negligence carry substantially different amounts of damages depending on the situation of the injured party – such as age, economic status, dependents (such as children or elderly family members), loss of earnings and the cost of any future medical procedures. Moreover, the level of damages is not necessarily an indicator of the complexity of a case, with factual and legal complexities not always aligning proportionately to the damages claimed. As made clear in Civil Procedure Rule 44.3, proportionality is not based purely on monetary analysis: the complexity of the litigation, consumer vulnerability, public importance and the conduct of the parties are all other contributing factors.[18] The same legal costs may be incurred in proving a claim whether it is of low or high value. For instance, in a case of delayed cancer diagnosis, the same expert evidence may be required where a patient’s life expectancy has been reduced by 2 years and the award is £20,000 or where life expectancy is reduced by 50 years and the case is worth £500,000. Those worst affected will be the most vulnerable: the elderly, the very young, those on low income and people with disabilities.

As stated previously, specialist clinical negligence lawyers filter out around 90 per cent of cases, taking forward only those with merit. Under a new system, value could be replaced by volume from unscrupulous claims farmers and unskilled litigants in person, with rising costs in practice as unmeritorious cases are no longer filtered out as effectively. As such, there is no guarantee that fixed costs will protect taxpayer value for money; the reverse could in fact be true.

FRCs provide certainty in advance about the maximum amount that the losing party will have to pay. Yet this means the amount that can be reclaimed may not cover the actual costs of the case, which are often hard to predict. Certain defendant behaviour may result in claimants running up legal bills that they will not be able to recover. This poses a substantial risk of undermining public trust in the justice system and leaving claimants unable to obtain effective remedy.

To date, the approach to FRCs has suffered from being partial. The Department for Health ran the 2017 consultation but is in effect the defendant in most cases. As such, it clearly has a vested interest in controlling costs. Yet it is also responsible for the NHS and for patient outcomes. Therefore, it is essential in future that the government is mindful of this anomalous position and works openly with a broader range of stakeholders to guard against such partiality. It should also consider options such as mediation, accreditation and incentivisation.[19] ACSO would welcome the opportunity to provide further evidence or advice as required. 

Reform of NHS litigation costs must not conflict with the tort law principle of putting the claimant, as far as possible, into the position they would have been in had the negligence not occurred. The risks of implementing a regime of FRCs are not dissimilar to those related to proposals to repeal of section 2(4) of the Law Reform Act (Personal Injuries) 1948, as called for by the Medical Defence Union (MDU).[20] The MDU argues that repealing S2(4), combined with a cap on future care and loss of earnings, will reduce the “enormous strain being placed on the NHS by the unaffordable rise in costs of clinical negligence claims”.[21] To repeal S2(4) of the Act – whereby a claimant can disregard NHS services and calculate care and treatment costs on a privately funded basis – will clearly be to the MDU and its members’ advantage, yet it is not necessarily apparent that it will reduce the burden on the NHS and the taxpayer.[22]

Since the start of the pandemic, the number of people waiting for NHS treatment in England has grown by a fifth, with 5.7 million people waiting to start routine treatment at the end of August 2021.[23] Any delay in treatment will delay the claimant’s ability to return to work, meaning any loss of earnings claim will increase. Moreover, it will further erode the claimant’s trust in the NHS, which is likely already to have lessened owing to the reasons they have made a clinical negligence claim, and place a further burden on already over-stretched health provision.

On how clinical negligence processes can be simplified to ensure patients can receive redress more quickly, more use of mediation and other alternative dispute resolution (ADR) mechanisms can help achieve this aim. NHSR conducted a recent evaluation of its Claims Mediation service and concluded that 77 per cent of mediated cases are settled on the day of mediation or within 28 days of the mediation date.[24] Mediation can provide claimants, patients and their families with a platform to articulate concerns and enables NHS staff to listen and respond to their issues. As such, it provides another avenue for staff learning and will therefore aid the desired move “from a blame culture to a learning culture” within the NHS.[25]

Most claimants do not wish to pursue a clinical negligence claim purely to seek financial compensation. Rather, they may wish to receive an apology from the alleged negligent party and/or be reassured that the error will not occur again. As explained by Julienne Vernon, head of dispute resolution and quality at NHSR, “Mediation puts the patient/claimant at the heart of the claim focussing on concerns which are very often not ‘all about the money’ and would otherwise not be possible to address in any other dispute resolution setting such as a meeting with just the lawyers”.[26]

NHSR has referenced its “continuous programme of training, presentations and publication of articles has been undertaken to promote mediation to NHS Resolution claims staff, legal panel, members, claimants and wider stakeholders”.[27] While ACSO encourages such initiatives, it is evident that a greater focus is needed on promoting the uptake of mediation. In 2020/21, out of the total of 15,397 cases that were closed by NHSR, only 299 cases were settled through mediation.[28] Other forms of dispute resolution – including arbitration and various forms of online dispute resolution - need to be explored and encouraged, where appropriate. ACSO actively champions the developing role of ADR across the civil justice system and would welcome the opportunity to engage with the Health and Social Care Committee and/or other relevant parties on ADR mechanisms, providing additional advice or evidence as required.

On collaboration between legal advisors as a means to encourage early and constructive engagement between parties, we note and welcome that NHSR is currently working with a number of leading claimant firms to improve resolution rates and reduce frictional costs through joint settlement meetings.

Q3. To what extend does the adversarial nature of the current clinical negligence system create a “blame culture” which affects medical advice and decision making?

A ‘blame culture’ can result in situations where individuals are reluctant to accept responsibility for their actions and mistakes as they are afraid of criticism and the prospect of potentially career-damaging reprimand from their managers and leaders. Moreover, it results in people becoming unwilling to take risks or speak out.

The existence of a blame culture within the NHS has long been recognised, including by a number of UK health secretaries.[29] NHS staff may be fearful that raising the alarm about mistakes made during patient treatment will result in criticism, dismissal, or litigation. In the 2020 NHS Staff Survey, 39.1 per cent of respondents did not agree that their organisation treats staff who are involved in an error, near miss or incident fairly.[30] Given a total of 595,000 NHS staff responded from 280 NHS organisations, this 39.1 per cent represents more than 230,000 workers. Again, while 74.8 per cent of NHS staff said their organisation acts on concerns raised by patients/service users, this means almost 150,000 employees did not agree with the statement.[31]

It is widely acknowledged that to ensure patient safety, incidents must be consistently reported and acted upon. As stated in the NHS A Just Culture Guide, “supporting staff to be open about mistakes allows valuable lessons to be learnt so the same errors can be prevented from being repeated”.[32] Running parallel to the problems of a blame culture is the need to hold medical professionals to account for any breaches in the duty of care they owe to patients. There is a difficult balance to strike here, as it is essential that patients who have suffered from the negligence of a medical practitioner are not denied justice.

While the risk of clinical negligence litigation may play a role in building the blame culture within the NHS, it is not the sole cause. For example, a hierarchical system of management has been said to deter staff from reporting mistakes, often for fear of repercussions.[33]

Recent years have seen regulators, policymakers and government focus upon shifting the blame culture to a ‘learning culture’, which should be supported and maintained.[34] In addition, regular engagement should be conducted with healthcare professionals, charities, consumer groups and other stakeholders to understand what measures will aid the development of such a culture. Finally, the government’s ongoing review of leadership in health and social care is both welcome and timely.[35]

Q4. How important is it that any clinical negligence system encourages lesson learning and commitment to change as a result of any action?

It is essential that lessons are learned if the overall level of negligence and therefore number of claims is to be brought down. Any reforms, new guidance or policy positions must have patient safety at their absolute heart and seek to reduce costs primarily by reducing the cause of claims, not by reducing access to justice – and to a proper explanation – for those who are victims of avoidable harm in the NHS.

Q5. What changes should be made to clinical negligence claims to enable a move away from a blame culture and towards a learning culture in the NHS?

An increase in the uptake of mediation, or other ADR mechanisms, may help to dismantle the blame culture within the NHS. Mediation provides claimants, patients and their families with a platform to articulate concerns and enables NHS staff to listen and respond to their issues, and potentially at a reasonable cost. As such, it provides another avenue for staff learning and will therefore aid the desired move “from a blame culture to a learning culture” within the NHS.[36]

Q6. How can the Healthcare Safety Investigation Branch work to improve short-term responses to patient safety incidences and therefore reduce the number of those who are forced to pursue litigation as a means of obtaining non-financial remedies?

ACSO does not have a view on this question.

Q7. What legislative changes would be required to support these changes?

ACSO does not have a view on this question.

For further information, please contact:

Rachel Cairnes

Policy and public affairs advisor

The Association of Consumer Support Organisations (ACSO)

Oct 2021