Intended for healthcare professionals


Indemnity provider calls for urgent reform of negligence payouts

BMJ 2017; 357 doi: (Published 23 June 2017) Cite this as: BMJ 2017;357:j3025
  1. Clare Dyer
  1. The BMJ

The spiralling cost of clinical negligence claims in England will become unsustainable unless the government reforms the system as a matter of urgency, a leading doctors’ indemnity organisation has argued at the launch of a new campaign.1

The Medical Protection Society (MPS) points to statistics showing that the NHS in England will be paying out £2.6bn (€3bn; $3.3bn) a year by 2022 if spending continues to rise at the rate it has done over the past five years. Over that period payouts went up by 72%, and current annual spending equates to the cost of training 6500 new doctors.2

But the spending spiral has been accelerated by a new rule that came into effect in March and is expected to cost an extra £1.2bn a year. The government cut the “discount rate”—the notional rate of interest that people who receive lump sums for personal injuries are expected to get if they invest the money—from 2.5% to −0.75%. This means that large awards covering the costs of future care and loss of earnings have to be much higher to compensate.

The MPS cites a claim that would previously have been settled for £1m but would now cost £2.3m and another that would go up from £5m to £12.8m.

The society provides indemnity cover for GPs, dentists, and doctors in private practice, while NHS Resolution deals with claims against hospital trusts. A full time GP is now twice as likely to be hit by a clinical negligence claim than nine years ago, the report says, although a 2016 review by the Department of Health and NHS England found “no material deterioration in quality and safety of primary care in recent years.”3 The highest paid claim to date for an MPS GP member was settled for over £5.5m.

The MPS said that GP indemnity fees have been rising to reflect larger payouts and that its Striking the Balance campaign to reform the negligence claims system in England was an attempt to tackle the problem at its cause.

The society calls for a three pronged approach: improving the quality and reliability of care delivery; increasing understanding of the drivers of clinical negligence claims; and a comprehensive package of legal reforms.

Its report argues that many patients who sue have not actually suffered a negligent injury.4 Patients may be seeking an explanation or apology, and the risk of litigation may be influenced by the quality of interaction between doctor and patient.

The campaign calls for radical change to the legal rules for clinical negligence claims, balancing reasonable compensation against the sums that society can afford. Under the current system, payouts are intended to replace a claimant’s actual lifetime earnings, so a banker who is unable to go on working receives much higher compensation than a labourer with a similar life expectancy. The MPS wants national average weekly earnings to be used instead in calculating compensation.

It also urges a limit on future care costs, with a tariff set by an expert working party for the realistic cost of providing home based care, and a 10 year cut-off from the date of the incident to the date when a claim can be made, with judicial discretion to extend it in certain cases.

Other recommendations include fixed costs for claimants’ lawyers for claims worth up to £250 000 “to stop lawyers charging disproportionate legal fees.” Legal costs accounted for around a third of the £1.5bn paid out in 2015-16 and in less severe cases are often higher than the compensation paid.


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