An overview of NHSLA Low Value Scheme Pilot

The NHS Litigation Authority (NHSLA) has decided to impose a scheme to enable low value clinical negligence claims to be resolved swiftly at a “proportionate cost”.  The NHSLA liaised with the doctors’ defence organisations, the Department of Health, the Ministry of Justice, the Association of Personal Injury Lawyers (APIL) and Action against Medical Accidents (AvMA) before creating the draft outline of the scheme.

Certainly, it is not a no fault compensation scheme, more a way of attempting to achieve “fair settlements” for small value clinical negligence claims. The pilot is expected to run for six months or until 1500 claims have been registered under the scheme, whichever is achieved first!  Thereafter a review will take place to see if it has worked.

The scheme is voluntary and will be open to claims:-

• after 1 April 2012;
• with a potential value of between £1,000 and £25,000 (including deductible benefits);
• where compensation for the injuries themselves will exceed £1,000.

If once a claim has entered the scheme, it is valued at more than £25,000 at a later date,  the parties may continue dealing with the claim under the Scheme by agreement.

The scheme excludes:-

• Multi-party claims
• Human Rights Act claims
• Claims where the Defendant is not a member of the Clinical Negligence Scheme for Trusts (CNST)
• Claims under National Health Service (concerns, complaints and redress arrangements) (Wales) Regulations 2011
• Claims funded by a conditional fee agreement

Referrals to the scheme must be made by solicitors who are members of AvMA or the Law Society Specialist Clinical Negligence Panels or a member of APIL.

Once a claim is in the scheme:-

• the complaints process may still be pursued separately
• it will trigger a moratorium on the deadline for issuing court proceedings which will run until 25 business days after the claim  leaves the scheme.  The parties can agree an extension of the 25 days by agreement
• there will be no need for after the event insurance policies as the NHSLA will not seek to recover its costs
• The NHSLA will also meet the cost of any joint expert medical reports (breach of duty, causation and condition and prognosis) as required.

The pilot scheme is not the same as the pre-action protocol. If a claim exits the scheme, the clinical negligence pre-action protocol will thereafter apply. If the Claimant wishes to proceed with their claim they will have to serve a Letter of Claim in the usual format.  If a Claimant unreasonably exits from the process, the NHSLA will reserve the right to raise issues in respect of costs.

If a Claimant decides not to participate in the scheme the Claimant may be reminded of the existence of the scheme by the NHSLA.  The scheme assists litigants in person in that they are allowed to participate in the scheme and they will receive the capped offer of funding for legal opinion on any settlement offer from a member of the AvMA or Law Society Specialist Clinical Negligence of APIL member.  If a Claimant wishes to exit the scheme the Claimant must give 10 days notice of intention to leave the scheme to the NHSLA.

There are four stages to the scheme.

Stage 1

• The Claimant must submit a standard form to the NHSLA (no witness statements)
• Acknowledgement of receipt from the NHSLA within 10 days
• Claimant’s appointed solicitor must state whether  they have submitted a claim to the scheme before. If not, they will be issued with log in details to enable communication with the NHSLA through its secure document transfer system (DTS)
• A log in will only be issued if a claim is accepted onto the scheme
• The NHSLA will advise the Defendant Trust of the claim on receipt of the claim.
• If the claim is not accepted on to the scheme the NHSLA will notify the Claimant’s solicitor
• Claimant to request relevant medical records – costs reimbursed by NHSLA
• Medical records scanned and sent to Claimants solicitor and any incidental costs in respect of x-rays/scans will be paid by the NHSLA
• Within 20 days (this can be extended by the parties by agreement)  of registration of the claim or receipt of the records by the NHSLA, the NHSLA will give a liability response of either:

(a)          Liability admitted

Apology from NHS Trust triggered (if requested). Then the NHSLA will select whether a condition and prognosis report and or further records are required.  If so, the claim then proceeds to stage 3 and stage 1 fixed costs become payable.

(b)          Liability expert report required

The NHSLA will select either a breach of duty, causation or both report and the claim proceeds to stage 2.

(c)           Liability denied

The Claimant’s request for non financial outcomes such as an explanation may be addressed, but the claim will then exit the scheme the limitation moratorium comes to an end 25 days thereafter.

Interestingly if the NHSLA has admitted liability they may also reserve the right to deny any specific allegations at a later date.

Stage 2

• Claimant’s solicitor to draft letter of instruction to joint expert on breach of duty and/or causation within 15 days
• Any expert will be selected from an approved list by “next on the list approach” subject to capacity.  The NHSLA can add to the Claimant’s instructions to the expert with relevant questions/points of fact within 10 days of receipt
• Claimant’s solicitor will then within 5 days of receipt to send the letter to the expert with the additional supplementary questions/points of fact from the NHSLA
• Expert’s report to be sent to both parties within 30 days and experts fee paid by NHSLA.  If more than one report is required, the cap on the report fee may be lifted in exceptional circumstances
• Within 15 days both parties will have the opportunity to put further questions and or points of fact to the appointed expert and the expert can be asked to address these points by way of either amendment to the report or a supplementary letter.  Thereafter the Claimant’s solicitor may take instructions direct from the Claimant and the NHSLA will take instructions direct from the member Trust on the contents of the report.
• Once the final report has been prepared the NHSLA will have three options:

(a)          To admit liability

The claim proceeds to stage 3 and stage 1 fixed costs are payable within 15 days.

(b)          Liability denied on grounds of either breach of duty and/or causation

This will be a non financial outcome and an explanation may be given by the NHS Trust – claim exits the scheme.

(c)           NHSLA will indicate a willingness to negotiate settlement

The NHSLA will also provide an explanation as to why liability is neither admitted or denied (for example if there are causation difficulties) and the claim then proceeds to stage 3. Stage 1 fixed costs are payable within 15 days as above.

Stage 3

• Medical evidence on quantum, offers to settle and negotiation
• The additional medical records relevant to quantum will be disclosed and if required by the NHSLA
• Claimant’s solicitor to obtain a report on condition and prognosis within 15 days of receipt of any additional records or entry into stage 3. Claimant’s solicitor will prepare the letter of instruction and the expert may be the same expert who prepared liability report
• Within 15 days expert sends the report to both parties (or receipt of additional records and/or the NHSLA’s confirmation that a condition and prognosis report is not required)

• The Claimant will send scanned copies of receipts and any other evidence of pecuniary losses
• The Claimant makes an offer to settle
• If liability has been admitted the NHSLA will make an interim payment of £1,000 in respect of general damages.   If a larger interim payment is required by the Claimant the Claimant must specify the exact amount requested and the reason for the request when making their offer
• NHSLA has 15 days to accept the Claimant’s offer of settlement or put forward a counter offer
•  If a counter offer is made by the NHSLA that will also include any response to a request for an increased interim payment and both parties will have a further 20 days to allow for negotiation and settlement which can be varied by agreement
•  If all is well and the claim settles the NHSLA will agree to pay the Claimants stage 3 fixed costs with an additional fixed fee
•  If settlement is not reached the NHSLA will pay stage 3 fixed costs and the case will proceed to stage 4.  Negotiations may take place by telephone and both parties are encouraged to do this at any stage of the process.  Once an offer has been accepted the claim will come to an end
•  If liability has not been admitted either party may make an offer on a percentage basis in respect of liability.

Stage 4                Arbitration

If stage 3 fails to bring settlement and either liability has been admitted or a percentage split agreed, the claim will proceed to stage 4. If liability has not been resolved and the claim has not settled , the case will exit the scheme.

The Claimant must notify of the intention to proceed to stage 4 and must propose three alternative independent barristers from an agreed list having checked availability.  NHSLA will select one barrister within five days and the Claimant’s solicitor will instruct the barrister on a joint basis to consider all the papers for a fixed fee and advise on the value of the claim within 10 days of receipt of instructions.  This decision will be binding by both parties and as a condition of entering stage 4.  The papers sent to the barrister will include all documentation available during the course of the scheme except for offers and details of interim payments.  There is no need for witness statements unless there is written consent of both parties.  The barrister will of course be advised of any percentage liability split agreed and will discount their valuation accordingly.

The assumption is that all offers are withdrawn at the point at which the Claimant enters stage 4 and if the Claimant beats the NHSLA’s final offer stage 4 fixed costs become payable (effectively stage 3 costs plus an enhancement) if the Claimant equals or fails to beat the NHSLA’s final offer stage 3 fixed costs alone are due and will have already been paid.

Costs

Recovery of costs:-

• Claimant              limited to the fixed costs under the scheme
• Defendant          no costs are recoverable at any stage by the NHSLA for the duration of the scheme.

Obviously if the case exits the scheme, it can proceed under the usual pre-action clinical negligence protocol.  If the claim is repudiated at either stage 1 or 2, the Claimant’s solicitor does not receive any costs under the scheme, but the NHSLA will pay the expert’s fee.

Review

At the end of each claim the NHSLA will apparently conduct a review to establish whether there are any lessons to be learnt and to feed back any relevant information to the member NHS Trust.

Comment

Whether or not this scheme will be successful is uncertain.  On the face of it, there is no reason why the scheme should not work. However, obstacles may arise at any stage of the scheme which may hamper the process and mean that a claim has to exit the scheme and proceed in the usual way.  Obviously the scheme on paper looks good. It looks set to work. However, in reality many lower value claims are not always straightforward and cannot be pigeonholed in such a way.  The scheme is currently in draft format and it will be very difficult to determine how well it will operate until it has had time to prove itself!

*Disclaimer: The information on the Anthony Gold website is for general information only and reflects the position at the date of publication. It does not constitute legal advice and should not be treated as such. It is provided without any representations or warranties, express or implied.*