New discount could lead to jump in compensation payments

personal injuryLiz Truss, Lord Chancellor, has announced a cut in the discount rate applied to personal injury claims.

Rates have dropped from 2.5% to -0.75%, which defence organisations claim could lead to a jump in compensation payments made by the NHS and dental defence organisations.

‘Everybody agrees that those who suffer medical accidents should be properly and promptly compensated,’ MDDUS chief executive, Chris Kenny, said.

‘The increase in claims awarded show that this is already happening.

‘The decision, based on a consultation undertaken in 2013, does not reflect that fact nor anything that has happened in the economy and healthcare in the intervening period – nor what is likely to occur in the coming years as a result of Brexit and other pressures.

‘It takes no account of the interests of the NHS, facing acute financial challenges.

‘It ignores the impact of unavoidably high indemnity fees on morale and recruitment in primary care.

‘Future decisions simply must be more joined up.’

Essential steps

Following this announcement, the MDDUS has listed three essential steps that need to be taken.

It believes the following are essential:

  • First, doctors and dentists must be fully protected from the cost of this decision. It welcomes the government’s commitment to this for GPs in the first instance and will work closely with them to achieve it
  • Second, it believes there must be no delay in producing proposals for the establishment of a better system for setting the rate. These must be radical in content and rapid in implementation, perhaps through the current Prison and Courts Bill
  • Finally, it says the government needs to produce timetabled proposals to address the wider issue of tort reform in parallel with changing the basis for setting the discount rate.

‘We look forward to seeing specific action in each of these areas,’ Chris continued.

‘In the short-term, however, we continue to explore the implications of the decision closely and do not discount any action that gives a reasonable prospect of achieving a better, fairer and more affordable deal for members.’

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