Legal fee ‘cap’ proposed for NHS medical negligence claims
The Government appears to be considering the introduction of a cap on recoverable legal fees for law firms involved in NHS medical negligence claims.
According to a new consultation paper, the fee a law firm may in future be able to recover in an NHS negligence claim could be ‘capped’ at between £1,000 and £25,000.
The proposal, which follows revelations that legal fees associated with such claims can often rise above the amount of compensation disputed, comes in a bid to reduce the bills the NHS will pick up for litigation and indemnity fees.
In one case, the Department of Health revealed that lawyers claimed around £83,000 in legal costs for a case in which the patient was awarded just £1,000.
Meanwhile, in the 2015/16 financial year, the Department’s litigation bill exceeded £1.5billion, according to reports.
The Government proposes that a cap on the amount that can be recouped by solicitors will save the NHS up to £45million a year.
Health Secretary Jeremy Hunt said: “What we often see in lower cost claims is a system where law firms cream off excessive legal costs that dwarf the actual damages recovered.
“We believe this creates an adversarial culture of litigation, which is inflating insurance premiums and drawing away resources from the NHS at a crucial time.”
Andrew Foster, Chief Executive at Wrightington, Wigan and Leigh NHS Foundation Trust, added: “The introduction of a fixed recoverable cost for lower value claims would support more proportionate payment to claimant lawyers – which, alongside improvements to the system, should make things quicker and better for patients.”
At Moore Thompson, our team of legal sector specialists are highly experienced in advising legal practices on a range of financial matters. We can support legal practices by ensuring that you are as tax-efficient as possible and help you explore alternative revenue streams, which in turn can help you to achieve greater profitability. For more information, please contact us.