The NHS Litigation Authority

1. The NHS Litigation Authority Professor Dame Joan Higgins Chair of the NHS Litigation Authority

2. The NHSLA • Background: why it was created • What the NHSLA does • Some key issues for the NHSLA • Important cases which will influence policy • Key issues for Trusts

3. Purpose of NHSLA “to minimise the overall costs of clinical negligence .. By defending unjustified actions robustly, settling justified actions efficiently and contributing to the incentives for reducing the number of negligent and preventable accidents” “to promote the highest standards of patient care and to minimise the suffering resulting from any adverse incidents” “to minimise the risk that patient care in a particular community is jeopardised by a large settlement against a local NHS body (and) to spread the costs of settlements more evenly over time”

4. Background • The NHSLA was established in November 1995 and is a Special Health Authority, covering England only. • In 1995 there were 98 different firms of solicitors representing English Trusts and Health Authorities (consistency, quality…) • NHSLA selected a panel of 17 (now 12) firms (high level of expertise built up), competitive tendering process.

5. What the NHSLA does Two key roles: • Risk management in NHS Trusts (CNST, RPST, LTPS, PES) • Management of claims and litigation (defence of NHS Trusts in membership of schemes) Staff: 150 people, most based in High Holborn, small team in Harrogate (80% are claims handlers). External contractors provide legal, risk management and actuarial services.

6. CNST: the big one! • Clinical Negligence Scheme for Trusts (CNST). A risk pooling scheme for Trusts to manage claims, when clinical incidents are alleged to have taken place. Covers PCTs, SHAs, ALBs as well as hospitals. Voluntary scheme but 100% membership. • Until April 2002 Trusts handled claims below a certain level, since then NHSLA manages them all.

7. CNST • A pay-as-you-go scheme not an insurance scheme. Contributions from Trusts, in each year, only sufficient to meet the cost of claims. Normally no surpluses or reserves, so cash remains in the NHS until it is needed. • Contributions range from £15K to £8.6million (before discounts). Trusts on CNST Level 1 get 10% discount, Level 2-20%, Level 3-30%. Contributions actuarially based, depending on level of risk in particular Trust, size and type of Trust, specialties, claims experience.

8. Claims - number by year of notification @ 31/03/2006 Source: NHSLA

9. Number of CNST Claims by Specialty @ 31/03/06

10. Highest risks • 45% of NHSLA payments relate to children with cerebral palsy (although these are only 6% of cases). The cost of payments to children who may have been damaged at birth is, therefore, very high and Trusts with obstetric departments would be making large contributions to the Scheme.

11. NHSLA – Financial Information 2006/07 Claims Payments £’000s : Provisions £9.23 billion

12. Managing risk and standard setting NHSLA works with Trusts to set standards (under CNST) and to monitor performance against these standards.

13. CNST General assessment levels @ 31/03/06 Total = 173

14. Standards - Levels • Level 1 - Effective risk management systems and processes have been documented (Policy) 2. Level 2 – The systems described at Level 1 have been implemented (Practice) 3. Level 3 – The organisation is monitoring its compliance with the systems and acting on the findings (Performance)

15. Comparison of levels achieved in CNST general standards – acute & specialist hospital trusts

16. Other NHSLA Schemes: • Non clinical risk pooling schemes (RPST) to cover liabilities to third parties (LTPS) and property (PES) (eg for falls on hospital premises). Power to insure commercially was removed in 1999. • Historic schemes covering incidents which occurred before 1995 (ELS and ex-RHA)

17. NHSLA aim “getting the right money to the right people at the right time”

18. Other NHSLA responsibilities • From 2005 NHSLA has been co-ordinating Equal Pay Claims on behalf of DH. • The Family Health Services Appeal Authority ceased to exist in 2005 and its work is now carried on under auspices of NHSLA. • In 2003 NHSLA was given task of minimising cost to the NHS of obtaining legal advice on implementation of Human Rights Act and has provided an information service.

19. How the NHSLA works • The NHSLA aims to ensure that cases are handled as quickly as possible and in the most appropriate manner. 96% of cases are now settled outside court. The Authority has pioneered ‘alternative dispute resolution’, particularly mediation, apologies and round table meetings. In 2004 it won the award for the Public Sector Mediator of the Year.

20. Outcome of claims for clinical negligence made against the NHS @ 31/03/06

21. Apologies and explanations The NHSLA strongly urges Trusts to apologise and explain to patients when things go wrong. Expressions of sympathy and regret would not normally constitute an admission of liability and the LA would not take advantage of such an apology, made in good faith. The LA is happy to help with advice about wording and timing, if necessary.

22. Time taken to settle claims • In 2005/6 CNST claims were settled, on average, in 1.46 years (from the date when the claim is first notified to NHSLA to resolution). • Other schemes (ELS, ex RHA, LTPS) took longer (1.85 years to 4.74)

23. Periodical payments vs Lump sums • Payments to claimants increasingly being made on a regular basis (periodical payments) rather than a one-off lump sum. Since the Courts Act 2003, Judges have had the power to impose such payments. • Periodical payments are fairer to claimants and aim to ensure that their needs are met for the rest of their life.

24. Family Health Services Appeals Unit • Main area of work is “control of entry” of new pharmacies by PCTs on the basis of whether the services are “necessary and desirable”. • Dispute resolutions between independent contractors (e.g GPs and dentists) and “fitness to practise” notifications and checks.

25. Important cases (1) Thompstone v Tameside and Glossop Acute Trust; Crofton v South Yorkshire HA. What index to use when making payments? Traditionally the RPI has been used but courts are beginning to decide that it is fairer claimants to use an index which is relevant to employing care staff (as this is the main cost to them). Courts have agreed that ASHE 6115 is the appropriate index. May be better for claimants but may result in significant increased costs to the Treasury.

26. Important cases (2) Crofton v NHSLA Issue is about preventing ‘double recovery’. Andre Crofton was severely damaged by heart surgery shortly after birth. He is in Local Authority care and will require lifetime care. Court of Appeal concluded that damages should be reduced to take account of sums paid by Local Authority.

27. Important cases (3) Cases of Gloucestershire NHS FoundationTrust and KCH. What if a Trust withdraws from CNST (e.g when it becomes an FT) – who honours the payments? NHSLA devised arrangement that Trust would meet their liabilities before leaving the Scheme and NHSLA will manage them on their behalf.

28. Future issues for the NHSLA • Being proactive, contributing to the patient safety agenda, to help prevent clinical incidents (CP project). • Advising DH and Treasury on financial management of claims (impact of Indexation cases) • Working with other regulators to avoid duplication • Advising DH on costs/litigation on Equal Pay • Implementation of the Redress Act

29. Key issues for NHS Trusts • Prevention of accidents, especially in high cost areas • Effective risk management • Reaching highest possible CNST standards and minimising contributions • Apologising and explaining • Consistent management of Equal Pay claims

30. Contact details: • Joan.Higgins@nhsla.com • Steve.Walker@nhsla.com (Chief Executive)