NHS Litigation Authority says a third of £1.1bn paid out last year went to lawyers and that government legal aid reforms have led to rising costs
The cost to the taxpayer is expected to rise to £1.4bn next year, with the NHS conceding that it faced an “increasingly difficult task” in managing the level of payouts.
In its annual report, the NHS Litigation Authority (NHS LA) added that the behaviour of several law firms was causing concern, with large bills being submitted and a large number of unjustified claims being made.
Ian Dilks, the chair of the NHS LA, said: “The costs of litigation are placing a burden on NHS finances of a magnitude that was never imagined when the NHS LA was established.”
The NHS LA also raised concerns about the coalition government’s overhaul of legal aid, saying it had “influenced the behaviour of some claimant lawyers” and led to rising legal costs in many cases.
The authority highlighted one case where an NHS trust agreed to pay out £5,000 for the failure to diagnose a patient’s tumour on the kidney. However, after the offer of £5,000 was accepted, the patient’s solicitors claimed costs of £121,700.
Further analysis of the bill revealed that the firm was claiming a rate of £400 an hour, although a significant amount of the work was carried out by unqualified staff. The firm then claimed a 100% success fee on top of this, raising the hourly rate to £800.
The NHS eventually had the claim struck out.
In another case, the NHS agreed to pay £2,000 to settle a claim. The claimant’s solicitors then presented a bill for £53,529.60 – although the final amount paid by the NHS was reduced.
The report said that it was “impossible to justify” the increasing number of cases where significantly more money was billed by claimant solicitors for legal costs than was paid in compensation.
Due to law firms’ actions, the legal costs of smaller claims have risen significantly. Where patients receive damages of up to £100,000, the average claimant’s legal costs are now more than 50% of the total payment.
By challenging costs, bills have been reduced by an average of 33%. The Department of Health is currently considering plans to cap the fees charged by lawyers in clinical negligence claims.
Ian Dilks, the chair of the NHS LA, said: “The costs of litigation are placing a burden on NHS finances of a magnitude that was never imagined when the NHS LA was established.”
The NHS LA also raised concerns about the coalition government’s overhaul of legal aid, saying it had “influenced the behaviour of some claimant lawyers” and led to rising legal costs in many cases.
The authority highlighted one case where an NHS trust agreed to pay out £5,000 for the failure to diagnose a patient’s tumour on the kidney. However, after the offer of £5,000 was accepted, the patient’s solicitors claimed costs of £121,700.
Further analysis of the bill revealed that the firm was claiming a rate of £400 an hour, although a significant amount of the work was carried out by unqualified staff. The firm then claimed a 100% success fee on top of this, raising the hourly rate to £800.
The NHS eventually had the claim struck out.
In another case, the NHS agreed to pay £2,000 to settle a claim. The claimant’s solicitors then presented a bill for £53,529.60 – although the final amount paid by the NHS was reduced.
The report said that it was “impossible to justify” the increasing number of cases where significantly more money was billed by claimant solicitors for legal costs than was paid in compensation.
Due to law firms’ actions, the legal costs of smaller claims have risen significantly. Where patients receive damages of up to £100,000, the average claimant’s legal costs are now more than 50% of the total payment.
By challenging costs, bills have been reduced by an average of 33%. The Department of Health is currently considering plans to cap the fees charged by lawyers in clinical negligence claims.
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