The fees trusts must pay to the NHS Litigation Authority for its clinical negligence scheme are to shoot up by more than half.
The authority has revealed that premiums are to go up by 53 per cent, totalling£713m in 2009-10 compared with£467m last year.
It is attributing the rise to inflation caused by no-win-no-fee arrangements, changes meaning payment calculations are based on average earnings rather than the retail price index and massive increases in the cost of claims.
The average size of claims of more than£1m has gone up by£1m to£3.7m in the past year.
No compensation culture
NHS Litigation Authority chief executive Steve Walker said: “We’re not experiencing a lot more claims – I maintain there isn’t a compensation culture in the NHS – but the cost of settling an individual claim has risen very significantly.”
He added: “We’re not criticising claimants or claimants’ lawyers for making these claims – it’s all in accordance with government policy - but the NHS is bearing the brunt.”
He called for a range of measures including capping solicitors’ costs to keep increases under control.
In some cases, bills for claimant costs were reaching “the best part of£1m” for payouts of£4m or£5m, he said.
In September, HSJ reported that the fees charged by solicitors representing claimants had risen by 122 per cent in the space of four years and were topping£90m.
The authority’s legal bill had risen by 48 per cent to£43.3m over the same period and the amount paid out in damages last year reached£660m (news, page 6, 18 September).
NHS Confederation director of policy Nigel Edwards said that even though the increase had been taken into account in setting the new tariff, it would still be a "major cost pressure" for NHS organisations.