Managing the costs of clinical negligence in hospital trusts Contents

Conclusions and recommendations

1.Increasing financial pressures on the NHS have started to affect waiting times and the quality of care, which risks leading to even more clinical negligence claims and in turn even greater cost. Almost 40% of clinical negligence claims against trusts are related to a failure or delay to diagnose or treat a patient. Many trusts face financial challenges and ever-rising demand, including delivering stretching efficiency savings. The Care Quality Commission, in its 2016–17 State of Care Report, highlighted that future quality of care is precarious as the system struggles with complex demand, access and cost pressures. The increasing financial pressure on trusts, has already started affecting standards of care. In particular, more and more patients are waiting longer for their treatments, which could increase the risk of future clinical negligence claims. NHS staff are working under huge pressure which may also affect trusts’ ability to deal effectively with complaints. Spending on clinical negligence is forecast to increase from 1.8% of trusts income in 2015–16 to 4% by 2020–21, further reducing the amount of money available for patient care.

Recommendation: The Department and NHS Improvement should report back to us by April 2018 on how they have ensured that trusts prioritise resources on patients that are most at risk of harm from increasing waiting times in the NHS.

2.The government has been slow and complacent in its response to the rising costs of clinical negligence. This Committee has raised concerns about the rising costs of clinical negligence claims on numerous occasions, going back to at least 2002, but costs have continued to rise. Annual spending is expected to double by 2020–21 to £3.2 billion compared with £1.6 billion in 2016–17, and current action proposed is unlikely to stop this growth. The Department told us that the only way, within the current arrangements, to bring down the costs of high-value cases is to reduce the number of cases by improving patient safety, particularly in maternity cases. It has introduced a range of maternity initiatives to improve maternity care but their impact on the number of claims made is not yet clear. The government also highlighted an option of seeking a change to the current legislation (from 1948), which requires that damages levels assume private provision of health and care costs, even though patients will receive free NHS care. On the rising number of low-value cases (less than £25,000), but which have high legal costs, NHS Resolution has introduced a voluntary mediation service to resolve claims and avoid costly legal processes, but only 71 cases have used this service so far. It is clear that tackling the rising costs of clinical negligence requires urgent and far-reaching action by more than one government department, but currently there is no overarching cross-government approach to tackling this issue.

Recommendation: The Department, the Ministry of Justice, and NHS Resolution must take urgent and coordinated action to address the rising costs of clinical negligence. This includes:

3.The government did not assess the impact of changes to legal reform on the volume of clinical negligence claims. On the rising number of low-value cases, but which have high legal costs, the Ministry of Justice accepted that government could have predicted the impact that legal reforms have had on the number of claims and claimants’ legal costs. These legal reforms included the introduction of ‘no-win-no-fee’ agreements, to promote access to justice among people who would not have been eligible for legal aid, and the capping of legal fees for road traffic accident claims which led to more clinical negligence firms moving into the clinical negligence market. The Ministry of Justice told us it had taken action to address some of these issues and that it hopes to extend fixed recoverable costs to as many litigation areas as possible, particularly clinical negligence claims below £25,000.

Recommendation: The Cabinet Office should consider including the “cost-shunting” impact of a policy when the impact assessment is produced and report back to the Committee by June 2018.

4.The NHS’s culture when things go wrong appears to be predominantly defensive, rather than candid and transparent, which limits its ability to learn lessons. This Committee has reported before that the NHS appears to be defensive when things go wrong. Although there have been initiatives such as duty of candour, the NHS has started from a low base and the progress towards an open and transparent culture is slow. There is a growing body of evidence that when things go wrong many people simply want an apology, or want to know that the issue is being dealt with and that it won’t happen again. However, they may make a claim if they are dissatisfied with the response they receive from trusts following a harmful incident. We are concerned that there is no system in place to understand which hospitals are doing well in managing harmful incidents and complaints, to identify good practice and to promote wider learning between trusts. Recent research suggests that greater transparency does not lead to a greater number of claims.

Recommendation: The Department and NHS Resolution should work with trusts to identify and spread best practice in handling harmful incidents and complaints. This should include how trusts say sorry and support patients when things go wrong.

5.A lack of consistent data across the system means the NHS does not understand why people do (or do not) make claims, or the root causes of the negligence. The profile of patients who make claims differs significantly from those who suffer adverse events. For example, people aged 65 and over experience more harmful incidents than those of working age but are much less likely to make a claim. NHS Resolution told us that the propensity to claim is also significantly higher among those who have had a year off work as a result. Currently, only about 4% of people experiencing a harmful incident make a claim. A small change in the likelihood of people making a claim could have a significant impact on the number of claims. Data on incidents, complaints and claims are not collected using a consistent classification and, therefore, the NHS does not have a good understanding of why some people make a claim and others do not. A new data system for incidents is being introduced which NHS Improvement believes should help.

Recommendation: The Department, NHS Improvement and NHS Resolution need to work with trusts to ensure that a consistent classification is used across incidents, complaints and claims data. They should then use these data to provide insights into the reasons behind clinical negligence claims. They should report back to the Committee with a plan on how they should approach this by April 2018.

6.The time taken to resolve cases is rising, which is likely to worsen patients’ experience as well as increase costs. The time taken to resolve cases increased by four months on average, from 300 to 426 days, between 2010–11 and 2016–17. On average every extra day taken to resolve a claim is linked with an additional legal cost of more than £40. There can be several reasons for delays, some of which are within NHS Resolution’s control and some are not. NHS Resolution has to live within its budget, and so must manage the pace of settlements to remain within this limit. Some delays have been due to bottle necks at court and the Ministry of Justice told us that it is aiming to streamline court processes for clinical negligence cases. Delays can also happen if the NHS fails to investigate or notify NHS Resolution quickly of harmful incidents that have occurred.

Recommendation: The Department, the Ministry of Justice and NHS Resolution need to clarify why it is taking longer to resolve claims and report back, by September 2018, on what actions they are taking to address this issue.

29 November 2017