In claims against medical professionals the system remains under pressure and our general prediction is that everything will take longer and claims will cost more to resolve.

The Fixed Recoverable Costs bubble?

The government is still considering the introduction of FRC for clinical negligence claims worth up to £25,000. Initially it appeared that this would be introduced in April; it has now been put back to October 2023.

We await the final proposals, but of interest is how the scheme will be implemented. Current alternatives are based on the date of incident or date of notification of the claim on or after the FRC implementation date (the latter being the preferred option). If adopted, it is likely claimant firms will accelerate existing claims to avoid them being caught by FRC resulting in a bubble of low-value claims.

QOCS, Part 36 and benefits down the track for insurers

Decisions of the Court of Appeal in Cartwright and Supreme Court in Ho prompted the government to launch a consultation in May 2022 proposing amendments to the Civil Procedure Rules relating to QOCS. The consultation paper acknowledges the combined outcome of Cartwright and Ho undermines the effectiveness of QOCS and Part 36 in resolving disputes; proposals are aimed at making QOCS provision fairer.

Late 2022 saw the Court of Appeal decide the important case of Harrison v University Hospitals of Derby & Burton NHS Foundation Trust [2022] EWCA Civ 1660 where we acted for the Trust. The claimant accepted a Part 36 offer (equating to 7% of her claim) outside the 21 day “relevant period” following service of surveillance evidence. The resulting judgment provides much welcomed clarity on the interplay of QOCS and Part 36 and in doing so has highlighted the ongoing consultation.

Whilst the outcome of the consultation is awaited, we expect significant changes to how QOCS applies, benefiting insurers in their legal cost spend. It is anticipated these changes will come into force in either April or October 2023 and mean insurers can offset costs against damages and costs (significantly expanding the “pot” of money that can be offset and the circumstances where it is applicable) where an offer is accepted outside the relevant period without order of the court.

Claims inflation

The value of claims is likely to keep rising. Costs have increased as courts are regularly allowing a 30% uplift on Guideline Hourly Rates; despite rates remaining under review it would be surprising to see any significant reduction. For compensators FRC seems like the best longterm route to controlling legal costs.

Accommodation claims have been impacted by significant claims inflation due to a lack of materials and labour. Many claimants have found that builders engaged to adapt properties have sought to renegotiate terms to reflect increased costs.

There is an increase in the level of care costs claimed (both as to increased hourly rates of pay and bonuses) given the shortage of available carers. Robust investigation and assessment of evidence is essential to determine the extent to which these issues genuinely impact compensation levels.

At your discretion?

Finally the government response to the Paterson inquiry is still moving at a glacial pace in consideration of then ongoing role of unregulated discretionary indemnity where patient claims are made within the independent healthcare sector. Preliminary views were released in December 2022 which explored possible options moving forward but reached no concluded view. A further update including proposals is expected in 2023 and will be crucial for the healthcare sector operating outside of state indemnity schemes.

To view Browne Jacobson’s full Insurance Insights 2023 report, please click here.