Complaints and Litigation - Health Committee Contents


Written evidence from Hill Dickinson LLP (CAL 14)

INTRODUCTION

Hill Dickinson LLP is a national firm acting for a wide range of insurance and institutional clients. They also themselves act for Health service clients including the National Health Service Litigation Authority and therefore have particular regard in this submission to the sphere of clinical negligence litigation.

EXECUTIVE SUMMARY

Complaints

—   —  Multi-fold reason for increased numbers of complaints - changing complaint system captures more complaints, increased public awareness, higher patient expectations, complaints co-existing with litigation and low morale in current economic climate.

—  Varied effectiveness of new complaints system - PALS, revised timescales, complainant-led system and face-to-face meetings work well; wide interpretation and requirement to log expressions of dissatisfaction as complaints in certain circumstances does not work well.

—  Constituent parts of new complaints system more effective - more complaints resolved at local resolution but ombudsman does not always share how decision was made.

—  PALS functions as an effective gateway to the complaints system assisting complainants.

—  Some Foundation Trusts do not report the number of complaints but the reasons are not clear; speculatively there may be administrative factors involved. Complaints are however reviewed with the aim of lesson learning.

—  Mixed views concerning Government plans for future complaints/handling arrangements. Current process with ICAS functions well and does not need replacing; to do so would lose the experience and knowledge already gained. Health Watch may lack the understanding and experience to deal with complaints.

—  Various systems being established to process data from complaints into new commissioning arrangements. Uncertainty as to how a variety of systems will interact. A unified approach may be more appropriate.

Litigation

—   —  Steady rise in cost of litigation against the NHS - amount paid in respect of Claimant's costs increasing substantially.

—  Multiple reasons for the rise in litigation costs - delays in the current legal system, funding of claims by way of Conditional Fee Agreements and/or ATE insurance and failure to use Alternative Dispute Resolution being factors.

—  Rise in use of Conditional Fee Arrangements corresponding with rise in costs reserves for Claimant's costs. Steady increase over recent years in the use of CFAs for Clinical Negligence cases. Funding proposals to remove Legal Aid for Clinical Negligence cases may mean that yet more cases are funded by way of CFA (and costs increased).

—  Complex interaction between litigation and development of an open reporting/learning culture in the NHS. Exact impact unclear. Arguments that it may assist in developing an open reporting/learning culture but also arguments that it may hinder.

—  NHS Redress Act considered to be a sensible and pragmatic means of "fast tracking" lower value cases. Possibility of extending the upper monetary limit to, say, £30,000-50,000.

—  Creation of a statutory right for "treatment injury" without needing to prove negligence inappropriate and contrary to established legal principles. Would lead to inequality depending on the mechanism by which a person sustained injury and risk of substantial increase in cost to the public purse.

—  Use of Alternative Dispute Resolution (rather than mediation as such) to be encouraged prior to litigation with likely reduction in costs. Logistical difficulty in timing ADR prior to proceedings when Claimants take on average almost two years to investigate a Clinical Negligence claim before serving the Letter of Claim.

A.  COMPLAINTS

1.  The reason for the sharp rise in NHS complaints

In an effort to provide evidence as to the reasons for the sharp rise in complaints we surveyed some of our clients who are either PALS or Complaints Managers. The main reasons are likely to be as follows:-

  1. 1.1  Recording of complaints. When the new complaints system was introduced on 1 April 2009 the manner in which complaints need to be recorded has changed. Section 13(1) of the Local Authority Social Services and National Health Service Complaints (England) Regulation 2009 ("The Regs") states "A complaint may be made orally, in writing or electronically". Where a complaint is made orally, the responsible body to which the complaint is made must make a written record of the complaint and provide a copy of the written record to the complainant. Therefore previously whilst oral complaints may have been made, there was no duty for it to be recorded as a complaint.
  2. 1.2  Increased awareness. Section 16 of the Regs state that "each responsible body must make information available to the public as to its arrangements for dealing with complaints and how further information about those arrangements may be obtained". In the circumstances the general public are likely to be more aware that there exists recourse for any complaint they wish to raise.
  3. 1.3  Increased or higher (often unrealistic) expectation. Complainants often base their arguments on information that they have derived from the Internet which may not be based on any medical experience/application. Therefore if the outcome is not as they expected then they may complain.
  4. 1.4  Duty on Trusts to investigate complaints and claims in tandem. Under the 2006 regulations where a complainant advised the investigating body that they intended to bring a claim for compensation there was no obligation on an NHS body to investigate the complaint. This exception does not exist under the 2009 regulations. Therefore if a complainant is contemplating or in the process of instructing solicitors to investigate a clinical negligence claim on their behalf the NHS body must still investigate the complaint internally unless it can be shown that there is a significant prejudice to the NHS body.
  5. 1.5  Current economic climate. One of our clients suggested that due to the current economic climate leading to rationalisation of staffing levels due to cut backs and changes to staff's contractual agreements regarding sickness and absence pay there is a general low morale amongst staff which may be affecting the treatment being provided, ultimately leading to more complaints.

2.  The effectiveness of a new complaints system introduced on 1 April 2009

2.1  The data received from clients suggest that on a scale of 1 to 5 the average effectiveness is 3.5. That said the responses ranged from 2 to 5 and therefore there appears to be very little consensus. For those who responded with 5, their view was that it was extremely effective if it was implemented properly.

2.2  The specific aspects which were effective include:

  1. 2.2.1  The role of Patient Advice and Liaison Services (PALS) as a "gateway" to the complaints system (for further information see below).
  2. 2.2.2  The new timescales. Under the old regulations, a complainant had to register a complaint within six months and a response had to be provided within 25 days. Under the new system complainants have 12 months from the occurrence giving rise to the complaint or from the time that they become aware of the matter. The Complaints Manager retains discretion to investigate complaints later then this if there are good reasons for the delay and it is still possible to carry out the investigations. In terms of investigation and response the responsible body to whom a complaint is made must investigate the complaint in a manner appropriate to resolve it speedily and efficiently and during the investigation keep the complainant informed, as far as reasonable practicable, as to the progress of the investigations (Section 14). There is no specific timescale in which a complaint needs to be investigated and is meant to be proportionate to the complaint that is made.
  3. 2.2.3  The flexibility. The new complaints procedure seeks to ensure that the process is much more complainant led and flexible so that the NHS body is clear on what it is that the complainant requires as an outcome and is aware of the steps being taken to investigate the complaint. Further the new process seeks to ensure that lessons are learnt from the complaint made with a view to seeking continuous improvement.
  4. 2.2.4  Face to face meetings were very positive and worked well.
  5. 2.2.5  A simplified system which is designed to make complaints handling open and accountable by creating a system which applies to both health and adult social care. Further if a complaint is made to a service provider about a service the service provider may either investigate the complaint themselves if felt to be appropriate or the service commissioner to investigate the complaint themselves.

2.3  In terms of areas that did not work as well, our clients were of the view that the fact that an expression of dissatisfaction which had not been resolved within 24 hours had to be logged as a complaint was time consuming and unnecessary.

2.4  One client said that the procedure is all but in name the PALS model of practice. Currently its application is open to such a wide level of interpretation it is hard to judge if it is more effective than its predecessor. It does enable NHS organisations to take a critical look at itself but this in itself will not always improve complainant's satisfaction levels.

2.5  Finally one of our clients (and we are of the view that it is likely to be mirrored by other clients) thinks that investigating a complaint alongside a clinical negligence claim is ineffectual and potentially contradictory.

3.  The effectiveness of the constituent parts of the complaints system

3.1  The purpose of removing the Healthcare Commission and creating a two tiered service rather than a three tiered service was to simplify the procedure. The response to our survey was mixed. One client Trust was of the view that many more complaints are resolved at a local resolution without referral to the Ombudsman. It would therefore appear that this system is much more effective than it was previously.

3.2  One client however said that local resolution has not made any significant changes as the constant is whether the complainant gets the answer and/or action they want as a result.

3.3  In terms of referral to the Ombudsman, some clients felt that it worked very well. One complaint manager said that he and other managers had received mixed interpretations of the complaints procedure from the Ombudsman but the general feeling was that it was a significantly better service than was provided by the Healthcare Commission.

3.4  Further one client said that the Ombudsman does not always share how she comes to her decision and that she has made criticisms when taking a creative/individualised approach to resolve a concern.

4.  The role of PALS as a gateway to the complaints system

4.1  From our questionnaire the majority of the clients who responded to the survey felt that the role of PALS was very effective and was of assistance to resolving initial "concerns" rather than complaints which need to be recorded under the 2009 regulations.

4.2  One trust client however advised that they no longer have a PALS team and the PALS and complaints have merged to form a Customer Services team.

4.3  One client trust felt that PALS was undervalued and under resourced nationwide by NHS organisations.

4.4  It would appear therefore that there may be scope for further use of the PALS system.

5.  The failure of some Foundation Trusts to report numbers of complaints

5.1  The data we have obtained from our client Trusts are that they do report the complaints. It is difficult to comment on the reasons behind failure of some Foundation Trusts to report the numbers of complaints. The authors would speculate that there may be administrative factors involved. The response from our client Trusts suggests that they review the complaints with a view to lesson learning including review at Trust Board level and senior clinical effectiveness meetings.

6.  The Government's plans for future complaints/handling arrangements

6.1  Our client Trusts have expressed a mixed reaction to this point. The feedback is that ICAS are very effective in taking on a support and advocacy role for individuals who wish to make a complaint. The concern is that the remit and function of the local Health Watch is felt to be currently too vague to gain assurance in their ability in this function and some concern has been expressed that members of LINks would be able to take on the additional role of advocacy within Health Watch. It is questioned whether they would have the knowledge or expertise to deal with Complainants, NHS staff or the complaints procedure and that LINks nationally does not appear to have had time to embed its own approach of becoming a representative of the community it serves before taking on such a significant additional workload.

6.2  The general thread is that the current process with ICAS provided by The Carers Federation works well and does not need replacing. There is concern that there has been an over-estimation of what Health Watch could achieve. Trusts have built up a relationship with their local ICAS staff who in turn have the experience and knowledge of the NHS and complaints procedure.

6.3  In broad terms, the concern seems to be that the current system with ICAS works well and that reviewing the system would only disrupt its effectiveness and require a substantial learning curve. The knowledge which has been gained would be lost. The overall view of our client Trusts is that establishment via the Local Authority of a local Health Watch/Health Watch England would increase the number of complaints brought with the function of the PALS Team being diminished so as to establish the Health Watch. Further concern is expressed that poor handling of the complaints by Health Watch would impact on the number and there may be a significant time lapse before Health Watch fully appreciates the challenges of complaints management. There is concern that individuals may look to drive the agenda of what Health Watch focuses on but an overriding concern that Health Watch would lack the understanding and experience to deal with the complaints.

7.  How data from complaints will feed into the planned new commissioning arrangements

7.1  The overall view expressed by our client Trusts is that they have arrangements in place for "information sharing" of complaints. For some Trusts the role is undertaken by the Associate Medical Directors (who are GPs and members of practise-based commissioning consortia) whereas other Trusts as regional providers collate the standard data such as the timeframe in which complaints are resolved and then provide bespoke information depending on what the commissioner seeks. Other Trusts report having a mixture of methodologies.

7.2  There must be some concern that with numerous different arrangements the benefits of information sharing will be weakened or lost. A unified approach may be more appropriate.

B.  LITIGATION

1.  The cost of litigation against the NHS

1.1  It is undisputed that the cost of litigation against the NHS is on the rise.

1.2  In 2009-10 6,652 clinical negligence and 4,074 non-clinical negligence claims against NHS bodies were received by the Authority. This was an increase from 6,088 clinical negligence and 3,743 non-clinical negligence claims in 2008-09.[13]

1.3  £878 million was paid in connection with clinical negligence claims during 2009-10 (which can be broken down as £651 million for CNST cases, £135 million ELS cases and £954,000 ex Regional Health Authority cases). This is an increase from £769 million which was paid in connection with clinical negligence claims in 2008-09.[14]

1.4  This represents a significant rise from payments made in clinical claims in 2004-05 when only £503 million was paid by the Litigation Authority.[15]

1.5  The increase in payment is mirrored by the increase of legal costs paid to Claimant and Defence lawyers. That said the costs claimed by Claimant solicitors continues to be significantly higher that those incurred by Defence solicitors. In 2009-10 the NHSLA paid over £163 million in total legal costs against these claims of which £121 million (74% of the total costs expenditure) was paid to Claimant lawyers.[16]

1.6  This represents a significant increase from 2004-05 when the total legal costs paid to Claimant and Defendant solicitors was £143 million of which approximately £85 million was paid to Claimant solicitors (59%).[17]

2.  Reasons for the inflation of litigation costs in recent years

2.1  Delay

2.1.1  Delays are a fundamental cause of additional expenses and therefore there is much to be said for robust deadlines and timetables. The authors consider that there has been an ongoing erosion of the obligations upon parties to comply with procedural deadlines under the Civil Procedure Rules and those established in the Court directions.

2.2.2  The perception amongst practitioners appears to be generally that there is little risk of any adverse order as a consequence of "minor" delays in filing court documents. There is, for example, no longer any real expectation that a Claimant will be struck out for failing to serve proceedings within 4 months of issue, even where the delay is many months old.

2.2.3  Greater concern, it is suggested, needs to be placed on the prejudice to the judicial system as a whole as a consequence of widespread delays and disregard for procedure deadlines and the result in inflation costs as well as the impact on judicial resources.

2.2  Conditional Fee Agreements/ATE insurance

2.2.1  There is no doubt that conditional fee arrangements have allowed in many cases a gross disproportion between costs and damages to exist. In the clinical negligence field, it is not at all uncommon to find that hourly rates of £300 will be inflated by 100% to leave Claimant firms making enormous profits even allowing for the cross subsidy of failed cases.

2.2.2  The market has wholly failed to regulate the level of success fees in those cases falling outside the fixed success fee regime. For example, in clinical negligence claims the vast majority of practitioners present bills with a 100% success fee uplifts as if they were entitled as a right by the nature of the work, as opposed to the facts of a particular case.

2.2.3  Little wonder we would suggest that there has been so much satellite litigation in this area, as insurers have struggled to undo the damage the new funding system has caused.

2.2.4  Of course the Health Select Committee will be aware that the voices in opposition to this injustice have been growing for some time.

2.2.5  Following Lord Justice Jackson's cost review on 16 November 2010 the government published two consultation papers setting out comprehensive proposals. The one which is of interest to this submission is the reform of civil litigation funding generally. It is readily acknowledged within this paper that there is a need to rebalance the current situation, where presently Claimants in many circumstances are permitted to litigate with no personal risk in relation to costs.

2.2.6  In respect of alternative funding the consultation paper is in all material respects a ringing endorsement of the proposals advanced by Lord Justice Jackson in his seminal review, completed earlier this year.

2.2.7  The principle proposal is to end the recoverability of success fees and ATE premiums. If this proposal is ultimately adopted, then these costs will have to be met by the Claimants from their damages. Success fees will be capped at a percentage of damages (excluding future damages).

2.2.8  Importantly the main requirement for ATE insurance should be removed by the introduction of one way costs shifting. Essentially this will mean that in all but exceptional circumstances even if successful, the Defendants will not be able to recover their costs from Claimants. However, all the available evidence suggests that the net effect would be significantly in the Defendants' favour.

2.2.9  It is also intended that "contingency fee arrangements", by which a Claimant's solicitors will charge their fees as a percentage of the damages recovery should be permitted in all civil litigation.

2.2.10  The consultations run until February 2011 and the Government will then publish its responses and presumably in due course draft legislation. The papers do not set out a timescale for implementation but the inference is that this will be within the current parliamentary term.

2.2.11  Clearly whilst this is welcome news to proponents of Lord Justice Jackson's review the Claimant lobby will oppose the changes vociferously no doubt with reference to principles rather than profit.

2.3  Failure to use alternative dispute resolution

2.3.1  In his final access to Justice Report, Lord Woolf recommended that the unreasonable refusal to participate in alternative dispute resolution ("ADR") should appropriately be taken into consideration when the issue of costs was for determination. The overriding objective includes an obligation on the Court to encourage the parties towards ADR.

2.3.2 It is now common place for many District Registries to adopt Master Ungley's draft directions on the issue of ADR, or a version of the same, which while stopping short of compelling participation, provides that the Court must be provided with justification by any party who refuses to participate. In Manchester, the clinical negligence District Judges order a joint settlement meeting in all cases with a value in excess of £100,000.

2.3.3  Still, since before the inception of the Civil Procedure Rules, there were calls for mandatory ADR and the others considered that there would be merit in revisiting this, whilst bearing closely in mind that ADR does not include only mediation. Mandatory ADR would not breach article 6 as the parties can ultimately proceed to Trial.

2.3.4  It is the authors' view that by proceeding to ADR this could potentially lead to a significant saving of costs.

2.4  Current economic climate

2.4.1  Historical data suggests that in a time of recession the number of claims increase. The authors would refer the readers to number 1 above.

3.  The impact of conditional fee arrangements on litigation against the NHS

3.1  It is indisputable that litigation has increased as a result of conditional fee agreements. The authors would suggest that one such reason is that for many Claimants there is no personal risk in relation to costs as the costs is borne by the insurance companies rather than the individual.

3.2  Hill Dickinson's data indicates that over the six year block 2005-10 the proportion of new cases in Employer's Liability/Public Liability claims funded by way of a Conditional Fee Agreement or else a Conditional Fee Agreement combined with After the Event Insurance have remained broadly level at around 91%.

3.3  However, in terms of the clinical negligence cases, the proportion of new cases which are funded by way of a Conditional Fee Agreement or else a Conditional Fee Agreement combined with After the Event Insurance have substantially increased up to the 40-45% mark. Claimants are of course obliged to consider alternative methods of funding and it is submitted that a proportion of Clinical Negligence cases would be funded by way of Legal Services Commission funding (Legal Aid). However, proposals to remove Legal Aid for Clinical Negligence cases would we submit lead to an increase in the proportion of claims funded by way of Conditional Fee Agreements (or Conditional Fee Agreements combined with After the Event Insurance).


3.4  When the average reserves for Claimant's costs are compared across the years the picture is more telling. The reserves for Employer's Liability/Public Liability cases have remained broadly the same, on average £12,000-15,000 per case. However, for the Clinical Negligence cases the average reserve per case has substantially increased from around £36,000 to £60,000.



  1. 3.5  The clear picture is that the legal costs of claims (Claimant's costs) are increasing substantially.

4.  The effects of litigation on the development on an open reporting and learning culture in the NHS

4.1  The response from our client Trusts on the effects of litigation on the development of an open reporting and learning culture within the NHS was very variable. Some reported no effect. Some reported that litigation hindered an open reporting and learning culture. Others reported that it helped following receipt of a claim with risks being identified and reported to the Risk Manager who would take action to address issues and ensure the incident does not occur again. Such would however appear more a benefit from a risk management perspective rather than development of an open reporting culture in the NHS.

4.2  The impact of litigation on an open reporting and learning culture is clearly complex. The authors can see rational grounds to argue that it is unlikely to lead to an open reporting culture (fear of sanctions, involvement in litigation, impact on career development). Equally there are arguments that it would assist with an open reporting and learning culture (exposure of systemic issues enabling risk management to deal with the same).

5.  The Government's intentions regarding implementation of the NHS Redress Act

5.1  The NHS Redress Act 2006 affirms Parliament's view that fault-based liability should remain the basis of compensation for Clinical Negligence. We would endorse that general principle. There would appear to be no justification for creating an exclusive class of cases which do not need to fulfil the usual criteria so as to receive compensation. Such would create anomalies with the person injured through no fault of their own in a motor accident being left with the same outcome as the person who suffers the injury as a consequence of Clinical Negligence. More starkly, the patient who suffers a poor outcome at a private hospital would not receive compensation in the absence of negligence whereas one who suffered a poor outcome at an NHS hospital would and would not need to show any negligence on the part of the doctors. Such cannot be right.

5.2  The premise of the Redress Act to provide a consensual "fast track" for lower value claims seems eminently sensible and should, in the authors' views, lead to a reduction in the time of litigation and a consequent reduction in the costs in those cases to which it applies.

5.3  The upper limit for monetary compensation under the Redress Act is currently £20,000. Consideration could be given to the possibility of increasing the threshold to, say, £30,000 or £50,000.

6.  Possible benefits of a statutory right to compensation for "treatment injury" from an independent fund without the need to prove negligence as required under tort law

6.1  As set out above (5.1), the authors do not see that there is any merit in creating an exclusive class of cases for which the basis of compensation would be different. Currently, negligence must be proved for an individual to receive compensation. The authors can see no logical justification to create a class of people who suffer injury as a consequence of treatment to receive compensation as of right whereas those with identical injuries suffered otherwise than by way of treatment would not receive the compensation. There is also the more stark contrast between the patient who suffered non-negligent "treatment injury" at a private hospital who does not receive compensation and one who suffers the same at an NHS hospital who does receive compensation.

6.2  The authors express concern that to create a statutory right to compensation for "treatment injury" might serve to reduce some legal costs (in not having to establish whether or not negligence occurred) but other costs will remain as issues of causation (what the "treatment injury" has caused and how the patient's outcome is any different than it would have been in any event) as well as quantification issues will still need to be looked at.

6.3  Removing negligence from the test for compensation will help to speed up an individual case but the concern is that all patients with a less than perfect outcome will pursue a claim and the overall cost to the public purse will substantially increase. The increased numbers of cases will most likely lead to a slowing down of dealing with cases overall.

6.4  The authors are conscious that there have already been a number of consultations and changes proposed regarding the funding of legal claims (including the provision of public funding for Clinical Negligence claims) as well as consultations and proposals regarding the costs system. Those proposals are of course relevant and the author's view is that the proposed costs reforms will of themselves hope to reduce costs to the public purse. The presence of a statutory right to compensation for "treatment injury" without having to show negligence could however easily eclipse that.

7.  Encouraging the use of mediation before litigation is initiated

7.1  Based on our current data, Claimant's solicitors take on average 22 months to investigate a Clinical Negligence claim before serving a Letter of Claim setting out the basis of the case. The Defendant will then have to respond within three to four months. Often proceedings will have to be issued because of approaching expiry of the limitation period (three years).

7.2  The authors' view is that the use of mediation or other forms of Alternative Dispute Resolution ("ADR") before litigation is initiated is pragmatic and appropriate.

7.3  The authors do not think that mediation as such should be enforced but rather Alternative Dispute Resolution so that the parties are not tied to having to follow the mediation route which can be costly. However ADR should be encouraged which could include mediation.

7.4  The timing of such ADR must however be appropriate. ADR would only be appropriate after the Claimant's Letter of Claim has been served so that the Defendant can know the case it has to meet. If ADR is to lead to savings in costs and reduction in Court time then it will need to take place prior to proceedings being issued. There will be benefits to using ADR pre-proceedings in certain cases although the authors can envisage that some cases would not be suitable for ADR at this time. The difficulty with ADR prior to litigation is the timescale required for investigating claims as set out above.

December 2010




13   Information taken from NHSLA website Back

14   Information taken from the NHSLA's report and accounts 2010, page 15. Back

15   Information taken from the NHSLA's report and accounts 2010, page 15. Back

16   Information taken from the NHSLA's reports and accounts 2010, page 17. These figures cannot be equated with the figures for total expenditure claims in 2009/10 because they relate only to claims closed during this year Back

17   Information taken from the NHSLA's report and accounts 2010, page 17. Back


 
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