NHS litigation reform

In 2005 the New Zealand Parliament made a conscious choice to alter the legislation underpinning their system of clinical negligence because they wanted to change from a punitive system to one that would encourage the co-operation of hospitals and medical professionals. This is the lesson we need to learn in England. If NHS Trusts, medical professionals, patients and their families are to engage in a thorough investigation into what is often a traumatic and tragic event, the whole investigation cannot be premised on a search for individual blame.

Clinical negligence cannot and does not inform or disseminate learning or systematically contribute to patient safety improvements. It is not its purpose and too much information is filtered out at an early stage to ever make this a realistic prospect. Demonstrating individual fault is fundamental if compensation is to be awarded, but this is not a process consistent with contemporary safety-focused investigations. Whilst there is a strong case for improving the techniques used to investigate mistakes made in the NHS these techniques would not align with the evidence gathering process for a successful clinical negligence claim.

Some claimant organisations said the screening process, as carried out by specialist claimant firms, prevents a significant cost that NHS Resolution would otherwise incur. Claimant costs, however, account for a fifth of all cash payments associated with clinical negligence and witnesses highlighted that law firms gravitate towards higher value cases, reject those that require a significant initial outlay, and are driven by the pursuit of legal fees. Given the skill with which law firms appear to have leveraged income from the clinical negligence market, we are not convinced that the real cost of screening cases is not eventually passed on to the taxpayer.

The system for compensating injured patients in England is not fit for purpose. It is grossly expensive, adversarial, and promotes individual blame instead of collective learning. We recommend that when a patient is harmed, they or their family should be able to approach an independent administrative body which would investigate their case and determine whether the harm was caused by the care they received and if, in the ordinary course of events, it was avoidable. The investigation would be inquisitorial, it would look at the facts of the case, and it would focus on how all parts of the system delivered care to the patient in question. Should it be found that the patient suffered harm because of their care, they would receive compensation.

We recognise that our recommendations would radically change the principles which underpin the way injured patients are compensated and the Bar Council said that to introduce a new statutory administrative scheme would be “a project of phenomenal ambition.” Given the scale of the undertaking, and the cultural change we are asking the system to make, the new system would be best implemented in stages with an initial focus on the most complex and expensive cases, which are those related to birth injuries. (Paragraph 85) 56 NHS litigation reform

As it becomes embedded within the framework of the NHS, we recommend that, in the first instance, the new administrative patient compensation system should be focused on obstetric cases which align with the Each Baby Counts criteria. Once established, and having proven its value, the independent administrative compensation system should then be expanded to accommodate all patient injury claims made against the NHS in England.

The Government is creating a new Strategic Health Authority (SHA) to investigate serious incidents and improve safety in maternity care. We believe that reconstituting the SHA to investigate claims, establish the causes of harm and determine eligibility for compensation would be an efficient way for the Government to implement our recommendations. However, reconstituting the SHA should be undertaken in such a way as to create an administrative compensation body whose independence is recognised by the Courts. (Paragraph 87) An affordable system

We are concerned only with the dynamics of the legal market in so much as they affect the ability of injured patients and their families to access compensation, and the system to learn and improve safety. However, we note that those that gain most from the present system are its most staunch defenders and the greatest critics of any administrative alternative. The evidence than an administrative system would open the floodgates to new and expensive claims is patchy at best and any examination of the impact on costs must be undertaken with the knowledge that, left unchecked, the cost of settling clinical negligence cases will more than double in the next ten years.

The advantage of an administrative system is that criteria can be established to remove uncertainty and turn what otherwise would be an adversarial process into one concerned only with the facts of the case. Compensation should be based on agreement that correct procedures were not followed and the system failed to perform, rather than the higher threshold that there has been clinical negligence by a hospital or clinician. Whilst this widens the pool of people entitled to compensation, the evidence from countries that have adopted such an approach is that overall costs will be lower not higher.

Establishing the precise criteria for an administrative patient injury compensation system based on system error is a complex task. We have taken evidence from various successful international schemes that each use a different threshold and we do not seek to be prescriptive over which threshold should be used in England. We recommend that the Government should consult widely at home - and evaluate best practice from abroad - to ensure that the bar is set appropriately.

In our July 2021 report examining the safety of maternity services, we recommended that the Government remove the disregard of NHS care in the award of damages. We have seen no evidence to change our recommendation. To argue that patients injured by errors in their NHS care would not want further care or treatment from the NHS is to mispresent the way healthcare is provided in England. The NHS is not a single entity, but a complex and comprehensive system made up of multiple organisations all dedicated to providing care at the point of need. An injured patient NHS litigation reform 57 receiving private care in a private hospital is likely to be under the care of an NHS- trained clinician who continues to practise within the health service. Should the NHS in England injure a patient it should be incumbent on the NHS to provide the necessary care to restore the injured party, as closely as possible, to good health.

There is no reason why an administrative scheme should be any less generous in the compensation it awards than the courts, not least because damages would not be top sliced to meet claimant legal costs. Within the administrative compensation system, no caps would be applied to the awards, but a mechanism would be required to establish the cost of care that may need to be provided privately in addition to state funded support.

Compensation should be based on the additional costs necessary to top up care available through the NHS and social care system, rather than the current assumption that all care will be provided privately. Whilst we recognise that additional care costs are difficult to calculate, we recommend that they should be modelled using practice established in international patient injury compensation schemes. We further recommend that Section 2(4) of the Law Reform (Personal Injuries) Act 1948 should be repealed for clinical negligence cases brought against NHS organisations in England.

The assessment of parental earnings in the calculation of damages for children under 18 years of age is unfair. It undermines the principle that damages should be calculated to meet a person’s needs and contradicts the principle of equality that sits at the heart of our health system. We recommend that the assessment of future earnings based on parental income should be scrapped for all NHS-related clinical negligence claims involving children under 18 years of age. We also recommend that such compensation is standardised against the national average wage to prevent unjust variability in compensation pay-outs.

There is strong evidence that an administrative compensation scheme would provide better value for money to the taxpayer than clinical negligence litigation. There is significant potential to strip away the vast legal costs which account for over a quarter of all that is paid and introduce a system which is cheaper to administer. Furthermore, allowing NHS care to be included in the calculation of damages and basing calculations of loss of earnings on the national average wage would help to moderate the value of awards. An administrative compensation scheme introduced with the reforms we recommend would be more cost effective and more responsive to the needs of patients and families. (Paragraph 125) A learning system

Clinical negligence litigation stands in stark contrast to best practice in terms of patient safety. Gains are made by careful system-wide analysis rather than the search for individual blame. The creation of the Health Services Safety Investigations Body as a statutory body which will undertake no-blame safe space investigations maps out the direction of travel for reducing harm and improving patient safety. Maintaining a costly and adversarial litigation system is evermore at odds with our 58 NHS litigation reform understanding of how the NHS should respond to failures in care. The administrative body’s investigative process would generate a rich, more usable source of data which could be returned to the NHS to improve patient care.

It is not within the scope of clinical negligence litigation to encourage the culture, or support the mechanisms, to identify learning from serious incidents. Neither can the process of litigation disseminate learning and enhance patient safety. Moreover, the experience of those who gave evidence to our inquiry illustrated that investigations after serious incidents are often inadequate and the looming threat of clinical negligence for providers and healthcare professionals does not encourage thorough investigations which can provide injured patients and families with a comprehensive account of what happened in their care.

Aside from the substantive reform of clinical negligence litigation that we have recommended, we also believe that the investigatory system should be reformed. After any tragedy involving medical error there should be a standardised process of investigation which focuses on the overriding priority to learn from mistakes and prevent tragedies being repeated. We recommend that, at a minimum, such investigations should: • last a maximum of six months, • be independently-led involving both families and the Trust in question, • include implementation of any safety recommendations that are made, • communicate lessons across the NHS.

We further recommend that, in parallel, an investigation by an independent administrative body responsible for alternative dispute resolution should be completed and a determination on liability for compensation released to the family, the Trust and NHS Resolution. The Trust and NHS Resolution would decide whether to accept liability for a mistake or negligence and to commence payments. If at the end of the six-month window liability for cases relating to maternity care has not been accepted these cases would fall within the remit of the Early Notification scheme and NHS Resolution.

In the longer term, an administrative compensation system would address problems associated with inadequate investigations by undertaking inquisitorial, system- focused investigations with no examination of individual blame. This would build greater confidence amongst healthcare professionals that they could be open and forthright when contributing to investigations. However, to further support healthcare professionals, we believe that there should be formal separation between the administrative body’s investigative process and external regulatory processes.

We recommend that information obtained by the administrative body in its investigations should not be shared with any other professional or system regulator unless it constitutes unlawful activity or identifies an immediate danger to patients. We also recommend that the administrative body should agree a memorandum of NHS litigation reform 59 understanding with the Office of the Chief Coroner to ensure consistency of investigation and provide transparency as to the process for the disclosure of information for inquests. (Paragraph 144) Access to justice

An independent administrative system designed in the first instance to provide compensation in birth injury cases would be much more responsive to the needs of patients and families. Without a contentious legal battle, eligibility would be established quickly and support provided to injured patients within weeks rather than years. The administrative body could be tasked with ensuring that compensation meets a child’s requirements as they grow and develop so regular reviews could be built into the process. Moving away from once-and-for all settlements would aid this process and provide a more realistic response to the needs of children with severe brain injuries.

The most effective system would be one that can provide initial compensation within weeks of a claim and then be adapted to meet the individual child’s requirements as they grow and develop. We recommend that awards be made with periodical review built in so that they can become responsive to the changing needs of patients.

Although our system would be no less generous in its awards than the courts, patients would still retain the option of pursuing clinical negligence cases and seeking redress via litigation. Evidence from abroad indicates, however, that when given the choice, patients and families prefer the simpler administrative process. We believe that the administrative system should be the mandatory first port of call for injured patients and their families.

Therefore, we recommend that litigation should become an option for claims covered by the administrative system only after the claimant has pursued their case through the administrative system.

We heard powerful testimony from people who have been through litigation about how they valued the support from solicitors who become their advocates and guides within the labyrinthine process. Whilst we do not doubt that there are many excellent solicitors who act in the best interests of people who have suffered terrible trauma, the fact that their guidance, advocacy and compassion is so valued only underlines the necessity for change. Legal professionals will only take commercially viable cases with a prospect of success, meaning many people who have suffered harm will never benefit from expert advocacy.

In the system we recommend, someone with a claim would not need intensive legal support as their claim would be evaluated inquisitorially without months or years of toil to demonstrate clinical negligence. It is also important to note that there is no guarantee that someone will find a solicitor equipped to provide them with the support and guidance they need. By moving away from litigation to an administrative system, patients and families would not have to enter a lottery of legal representation. (Paragraph 191) 60 NHS litigation reform

Settling cases without court proceedings is positive but does not necessarily mean that injured patients will not experience an adversarial, complex and expensive process. The most serious cases still take years to settle rather than weeks or months. NHS Resolution’s efforts to reduce the number of cases that reach court are welcome, but more can be done to resolve cases early and provide a sense of closure for both injured patients and healthcare professionals.

We recommend that before any court case there should be compulsory use of alternative dispute resolution mechanisms. This often happens before the start of a trial but should happen before the issuing of any court proceedings. We recommend that the Government consult on the format of alternative dispute resolution and whether it should include mediation or be structured around an inquisitorial, ombudsman-style process.

It is understandable that representatives of injured patients should wish to see fault admitted and cases settled early, but the statutory framework on which clinical negligence is based makes this very difficult. Clinical negligence is focused on individual blame, therefore, it is unsurprising that within this process individual clinicians will seek to defend their actions, protect their reputations and expect support from their employers in doing so.

NHS staff, injured patients and families need greater support in dealing with the fallout from clinical negligence cases. We recommend that every hospital should have adequate numbers of staff trained in “just culture” practices to reduce confrontation and relationship breakdown between injured patients, their relatives, and bereaved families.

We heard that there is no leeway for NHS Resolution to concede cases on any basis other than clinical negligence, but this was challenged by academic evidence we received. In response to this report, the Government should provide an explanation which addresses the evidence we have cited which shows that some clinical negligence cases have been settled even when negligence has not been found. The Government should explain how frequently cases are settled without negligence being established and whether negligence is the appropriate test if it is not being applied in actuality.

We are concerned that the Government’s proposal to introduce Fixed Recoverable Costs in clinical negligence cases below £25,000 may compromise access to justice for the poorest claimants. The Government is right to try and rein in excessive legal costs, but until the administrative scheme we are recommending is introduced in full it must ensure that all injured patients retain access to adequate legal representation. In response to this report the Government should set out the safeguards it will introduce to ensure that fixed recoverable costs do not restrict access to legal representation for the poorest and most vulnerable injured patients.

Once an administrative scheme is established for all clinical negligence claims the future of Qualified One-Way Costs Shifting (QOCs) in clinical negligence cases against the NHS should be considered. The Government has said the purpose of QOCs is to minimise the financial risk to claimants, but, as the administrative system will provide risk free access to compensation which is no less generous than that awarded by the NHS litigation reform 61 courts, QOCs will become redundant. We believe that any claimant who pursues litigation having been offered compensation by the independent administrative body should have to pay the defendant’s costs if they subsequently lose their case. Part 36 offers will remain vital. We recommend that NHS Resolution should consider using the quantum of compensation made by the independent administrative body as a part 36 offer. (Paragraph 198) 62 NHS litigation reform