Category Archives: Perverse Incentives

Ways of reducing the bill for NHS negligence – The perverse incentives and outcomes …

Every doctor and student of medical systems needs to understand the perverse incentive. I define this as a “driver within a system that works against the overall objective of the system”. Claims for medical Negligence in our tort driven system are necessary to arrest or slow down the continuing decline in standards. Unfortunately Dr Barton is correct: the 4 health services have lawyers who are salaried and paid win or lose, and 80% of claims result in success! The argument for no fault compensation has been addressed properly in NZ and several other countries, and Australia appears to have found a half way house…

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Times letters 24th Jan 2020: Ways of reducing the bill for NHS negligence

Sir, Your article “£4bn budget for legal fees in NHS negligence claims” (Jan 22) points out that the health service faces legal costs of £4.3 billion as part of a compensation bill for clinical negligence claims of £83 billion. The extent of this crisis cannot be overemphasised, as over the past three years the bill appears to have risen from £54 billion, according to the Department of Health. Apart from the usual platitudes about being careful, no one appears to be interested in addressing this parlous situation.

I previously worked for seven years in Australia, where this became a big problem and was addressed by an act of parliament transferring the liability risk away from the provider, unless it was ruled criminal negligence. This has led to a year-on-year fall of medical protection and indemnity fees for colleagues in Australia, while those in the UK have risen inexorably, providing yet another reason why doctors are giving up in droves and taking early retirement.

The start of a new government offers an ideal moment to address this festering sore on the NHS’s future.
Professor Angus Dalgleish

Foundation professor of oncology, University of London

Sir, As medical litigation costs spiral and threaten the future of the NHS, the case for a no-fault compensation system becomes overwhelming. At present, if a patient cannot prove medical negligence, they will receive no financial compensation — the decision sometimes having more to do with inadequate record-keeping than true clinical incompetence or negligence. As a result, two patients may have identical medical injuries but one will receive nothing whereas the other may be well compensated after perhaps years of litigation.

New Zealand has had a successful no-fault compensation scheme since 1974, with changes in 2005 ironing out some of its early anomalies, resulting in most claims being resolved in weeks rather than years. Litigation lawyers are the only people benefiting from the system in the UK.
Dr Andrew Quayle

Retired GP, Martock, Somerset

Sir, The cost of medical negligence (or accidents) is indeed high, but the possibility that the size of a giant claim might be reduced means that many cases end up in court because the legal fees justify an expensive defence. However, with court and legal costs of about £2,800 per day on top of barristers’ and solicitors’ fees it is often cheaper for an NHS Trust to settle a little case for a small sum than to defend it. While this is often done without an admission of liability it is open to abuse, because once word gets around it may generate frivolous or spurious “me too” claims that result in a payment of a few hundred pounds without many questions being asked. The system needs to address this as well as the top-end settlements.
Dr Andrew Bamji

Rye, E Sussex

Sir, NHS legal costs are inflated partly because of perverse incentives. NHS lawyers are paid win or lose, which encourages “deny, delay, defend” behaviour and promotes speculative defences. By contrast, claimant lawyers are generally paid “no win, no fee”; payment is by result, which imposes commercial prudence. This is amply borne out by NHS Resolution figures which show that compensation is paid in 80 per cent of cases where proceedings are issued. NHS lawyers should be paid by result and not rewarded for failure.
Dr Anthony Barton
Solicitor, Medical Negligence Team

Professional Liability Insurance : Market Global Report Jan 2020 – Fusion Science Academy

New York Telecast: Global Liability Insurance Market Status (2015-2019) and Forecast (2020-2024)

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Lexicology: Wright Hassall LLP The most notable medical liability case in 2019

United Kingdom August 27 2019

The NHS is facing an existential crisis. The negotiations over junior doctors’ pay and conditions and widespread dissatisfaction among GPs, combined with a £2.45bn overspend by NHS Trusts, is impacting on patient care. The NHS is treating more patients than ever before, including a rapidly growing number of elderly people whose care, in many cases, is caught in a Mexican stand-off between the NHS and social services.

The NHS announced it has paid out more than £1.63 billion in damages for medical negligence in 2017/18; this is an increase from £1.08 billion in 2016/17 with the highest number of claims coming from emergency medicine. The number of claims made as a whole has decreased slightly (0.12%), but the cost to the NHS continues to increase.

The cases outlined below are some of our most notable and an indication of what can go wrong when the caring services come under pressure – and these are just the tip of the iceberg……

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An extra tax of £66.66 per head. The cost of “English” health litigation, and its rising…

Litigations: There is a choice, but the “short term” attitude of every administration has ducked the right option. No fault legislation …. Those of us in the know, and those working at the coal face can only laugh cynically at the DHSS statement:

‘Our ambition is for the NHS to be the safest healthcare system in the world and it has been recognised that the rise in costs of claims is not due to a decline in patient safety.’ ( !!! Ed )

The finances of Wales, Scotland and Ireland are no different, and probably worse. Poorer people have less means and ability to litigate, but on the other hand the services in Wales are worse. So much too for a “National” health service.

( No Fault Compensation claims are handled by Government run schemes that each have their own set of rules and regulations. The amount that is paid out, if the claim is successful, is usually less than you would normally get in a standard personal injury claim.7 Apr 2016 )

How about some trial areas, a report on comparisons with other countries, and a costing. Surely it has to be cheaper than £4.3 bn, which works out at £66.66 each assuming 60m people in England. Best to be either very poor or very rich to make a claim.

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BBC News today: NHS faces huge clinical negligence legal fees bill

The NHS in England faces paying out £4.3bn in legal fees to settle outstanding claims of clinical negligence, the BBC has learned through a Freedom of Information request.

Each year the NHS receives more than 10,000 new claims for compensation……

The Mail: NHS England faces £4.3BILLION legal bill to settle negligence

…The Department of Health has said it has no option but to tackle ‘the unsustainable rise in the cost of clinical negligence’.

According to a Freedom of Information request by the BBC, the figure includes existing unsettled claims and projected estimates of future claims…..

Patient complaints hit a ‘wall of silence’ from NHS – No fault compensation would help change the culture…

Another argument for no fault compensation. Longer waits will mean we are poorer…

The blame game. The proliferation of compensation claims – needs a “no fault compensation” cure, possibly through a social insurance fund.

£500 each citizen, man, woman and child, paid for “negligence” annually by 2010. Why no “no fault” compensation?

Cancer sufferer urges patients to stop suing NHS – No fault compensation is the answer.

No fault compensation systems BMJ 2003;326:997

William Gaine opines in the BMJ: Experience elsewhere suggests it is time for the UK to introduce a pilot scheme BMJ 2003;326:997

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A&E waits are symptomatic of a complete failure. The safety net has been removed, and fear is returning – in spades

We need investment in buildings, plant and people. The crisis is here and now. A&E waits are symptomatic of a complete failure. The safety net has been removed, and fear is returning – in spades.

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Nick Triggle for BBC news 13th December reports: Every major A&E misses wait target for first time

and BBC produced a report on the “Accident and Emergency crisis”.

See the source image

The search for waiting time failures in A&E reveals an epidemic of failures.

New builds, particularly under the PFI initiative have been catastrophes of long term mis-management and perverse incentives leading to perverse outcomes. These are exposed by Louise Clarence-Smith in the Times 17th Jan 2020: Soaring costs and delays expose lack of scrutiny at Carillion hospitals and “Beware the real costs of Hospital Failures”

one of which is demand for Private Treatment centres….

In The Guardian opines that A&E wait times matter. But the key issue facing the NHS is investment


A service run ragged – and meaningless pledges for mental health provision

The perverse incentive for health boards and commissioners to prioritise oncology or surgery above psychiatry is disturbing. Whenever we listen to the politicians and managers watch out for the word “priority” or “prioritisation”: it means rationing. And remember, the spending plans (outlined at the end – graphic|) dont apply outside of England. MIND can help, but it can only fill some of the gaps..

Andrew Molodynski is the BMA consultants committee mental health lead and opines in the BMJ Doctor supplement: Mental healthcare – a service run ragged

Mental health staff face unmanageable workloads, depleted teams and poor access to training, BMA research finds – with government promises of new recruits sounding ever more hollow. Keith Cooper reports

Bold pledges to recruit vastly more members of staff, as a means of easing the pressure in mental healthcare, are often deployed with aplomb by politicians.

More than 10,000 extra would be recruited this year, said the Conservative manifesto in May 2017.

Its opponents back then believed it was based on ‘thin air’, they told the BBC. Two months later, the Government’s official plan, Stepping Forward to 2021, pushed the figure up to 19,000 additional staff.

Leap forward to 2019 for an even more ambitious scheme. The NHS England Mental Health Implementation Plan called for a further 27,000 staff, a mix of psychologists, psychiatrists, nurses, social and peer and other support staff, to make up the ‘multidisciplinary’ approach it envisioned. An influx of new staff into mental health would certainly help the patients who suffer the traumatic, sometimes tragic, consequences of shortfalls and those in the service who struggle to cope with ever-rising demand….


20190746 thedoctor January issue 17

…Mental health has been high on the political agenda for some years now, with bold promises from Government in recent times: more staff, more services, more funding, no patients being sent around the country for care, reduced waiting lists, fewer suicides. However, what we have seen outlined in this article and numerous academic and mainstream publications is essentially the opposite: longer waiting lists; increasing out-of-area placements; slimmed-down services that cannot cope with demand; and most worryingly a rising suicide rate for the first time in decades.

In microcosm, my own team (a general community team for people like you and I with mental health problems) has recently been audited as having 50 per cent too few staff. We knew that already. Will things be put right? Almost certainly not. If we were an oncology or paediatric team would they? Almost certainly yes.

…BMA recommendations on parity of resources, access and outcomes – what does it look like?

On funding: Clinical commissioning groups should double expenditure on mental healthcare. More should be spent on mental health wards, research, and in primary care and public health.

On access: Standards for access to services which are fully funded. Reviews of all trusts who place high numbers of patients in beds far from their homes.

On workforce: Realistic and measurable workforce goals. Targeted recruitment campaigns for the hardest-to-recruit sub-specialties, such as old-age psychiatry and learning-disability psychiatry.

On prevention: A cross-government body established to draw up a joint strategy on public mental health. National and local Government adopt a ‘mental-health in-all policy’; mental health impact assessments for all new policy proposals.

Read the BMA report

The pressures on doctors, in and around an election… The social contract has been broken. This is why there is so much anger, and more to come.

Doctors should be able to say how they feel. In my own practice there was some comment when I put a poster showing my voting choice on my office door. There was no implication that the whole practice should support my choice, but several of the partners were uncomfortable. … Doctors are under great strains: overworked, gagged, humiliated (The suggestion that many GPs are corrupt) and there is more and more evidence of early burnout.

Purdah rules shouldn’t stop NHS doctors speaking out  (BMJ 2019;367:l6679  )

Charles Lamb (Psudonym)  for the BMJ talks about the “4 major errors in medicine” and asks: Please do not feed the lawyers

Tim Locke, Dr Rob Hicks | October 1, 2019 for Medscape opine: Sexual Harassment of Uk Doctors: report 2019

Thank goodness some do speak out, and even on video.

Patients are waiting twice as long for an ambulance if their GP asks for it at their surgery. Perverse outcomes are everywhere, and arise because of perverse incentives. ( Alex Matthews-King in the Independent 4th January 2019)

Emergency Beds are now used all the year round. Trolley waits are routine. But why is it that a child having his treatment on a perfectly safe mattress, gains more sympathy and publicity than multiple grannies on trolleys? At least treatment was being given.. In some emergency situations we could have two children to a bed. Better than refusing them..

We have rationing by delaying decisions – gaming, arbitrary rules, and bureaucracy  (Obfuscation of the truth) – as described by David Oliver ( BMJ 2019;367:l6620 ) 

No wonder the doctor patient relationship is being threatened. Without continuity of care and an ongoing trust relationship, we are going to get more burned out doctors. If it helps here is a good description from Jonathan Glass in “How not to be the heartsink doctor” ( BMJ 30th November 2019)

The social contract has been broken. Social care crisis wastes £½m of NHS money a day and is not free but means tested. (The Times 4th December) This was followed by Social care crisis wastes nearly £30000 of NHS money an hour by This is why there is so much anger..

The reality is that for most of us the state safety net is absent. If social care is means tested, then why not health care?

NHSreality is a “heretic”. The NHS has become the greatest cult of our time. As a “holy relic” it is granted immunity from meaningful change.. If social care is means tested, why not medical care?


The Election Horror Show, and denial… The political spin doctors are leading us into a health-less “black hole”. The Health services are too toxic for honesty…

The main reason for the problems with beds is that 80% would not be occupied at all if there were alternatives … Such as home or community Care.
The main reason there are too few staff, both diagnostic and caring, is that it takes decades to train them, and concern to retain sufficient. There have been 3 parties in power over the last two decades. Austerity has not helped, but the problems were incubated well before 2008.
There is no NHS where patients are concerned, but there is for staff, who often aspire to work and educate their children in better areas. The 4 dispensations are controlled by Westminster with regard to finding, but Scotland has more than Wales due to their different methods of funding. They all choose to spend their money differently with different outcomes. This experiment ,without honesty or the possibility of sustaining the 4 services, and done without the consent of the professions, is going to reveal serious differences in the next few years. (See WHO and IFS reports)
We need to ask why no other country has chosen to imitate us. We need to abandon the experiment of devolution in health. The media needs to stop using the abbreviation NHS.
Outside of health we need to review the rules of referenda, to change to PR, to have a constitution, to control false news, and to institute a fairer tax system, particularly addressing capital ( Land Rental Tax. ).

California and Ireland have addressed referenda well.

We need to bring back choice as a virtue and this election is making most of the professionals sick.

The political spin doctors are leading us into a health-less “black hole” because they can get away with it and the perverse incentives to fail to address the issues are too strong. The Health services are too toxic for honesty.

The Economist talks about the “nightmare” before Christmas and Endorses the Liberals despite their mistakes:

Economist endorses the Liberals Dec 5th 2019…

….Next week voters face their starkest choice yet, between Boris Johnson, whose Tories promise a hard Brexit, and Jeremy Corbyn, whose Labour Party plans to “rewrite the rules of the economy” along radical socialist lines. Mr Johnson runs the most unpopular new government on record; Mr Corbyn is the most unpopular leader of the opposition. On Friday the 13th, unlucky Britons will wake to find one of these horrors in charge.

December 9th in the Times Chris Hopson reports: We asked politicians to be straight on the NHS. They’ve not listened

The leading article on the same day: Election Promises – Times leader 9th December  accuses the politicians and by implication the media themselves, of denying voters the truth.

Shaun Lintern for the Independent reports 3rd December: Leaked NHS document reveals government plan to use cheaper staff to fill nurse vacancies

We even have the possibility of “foreign influence” demoralising the population with false truths.

Shanti Das and Andrew Gregory reveal the incompetence of the short term politicians: Amazon ready to cash in on free access to NHS data (The Sunday Times 8th December)


A toxic amalgam of 4 “health and social care” services

It seems that all the 4 health services are too toxic for any party to make a meaningful statement of how they, or social care, should be changed. The BMJ in a comparison of bribes describes the differences between the parties on Health and Social Care. Not one of them is suggesting that even with money, plant, people and cultural improvement, the system itself needs to change. It is not founded on a financial rock, and the result is a perverse incentive to deny or ration care covertly if possible, but overtly if the management cannot get away with it.

The ingredients for toxicity have been building up for years. Management, consultants, bullying, and culture etc.

Avoiding the issues Nowhere to go – The BMJ

2013 BBC News: Bullying ‘creates toxic NHS culture’ – BBC News

2013 The Independent: Watchdog warns of ‘toxic cocktail’ within the NHS

2013 Health Service Journal: NHS in-fighting is creating a toxic culture | Comment | Health …

2015 National Health Executive: ‘toxic’ bullying culture – National Health Executive

2019 HSJ: Surveillance of managers is ‘toxic’ says Don Berwick | News …

2019 The Guardian: Latest NHS maternity scandal is product of toxic ‘can’t happen …

2019 The NHS crisis of caring for staff | The King’s Fund

Miles Sibley in the BMJ: Changing the culture of learning from deaths

With the revelation that a “toxic culture” led to the deaths of mothers and babies at the Shrewsbury and Telford Hospital NHS Trust, patient safety in maternity services is once again in the spotlight…..

Was there ever a better opportunity to promote Proportional Representation?