A report indicates a slowdown in the clinical negligence market amid increasing consolidation.
- NHS claims settlements are predicted to slow in the upcoming year due to fewer claim registrations in previous years.
- Future growth may arise from claims in emerging sectors such as care homes and cosmetic procedures.
- Uncertainty surrounds the implementation of fixed recoverable costs for low-value negligence cases.
- Alternative dispute resolution methods are gaining emphasis to alleviate court delays.
A recent report has outlined a predicted deceleration in the clinical negligence market, primarily driven by continued consolidation among law firms. This slowdown is attributed to a decrease in the number of NHS claims being settled, a consequence of reduced claim registrations from two years prior.
Looking ahead, while NHS claim settlements might decline, opportunities for growth are anticipated to arise from other sectors. These include claims related to care and nursing homes, equipment failures, and unregulated practices like certain cosmetic surgeries and non-invasive procedures.
The report reveals that the legal revenue from clinical negligence in the UK reached £1.58 billion in 2023-2024, marking a significant 7.6% increase from the previous year, which had modest growth. Claimant legal fees in NHS cases rose substantially, while the defense legal fees saw a more modest increment.
There remains a question about whether a fixed recoverable cost regime for low-value clinical negligence claims will be implemented. This policy was supposed to be enacted by the previous government but currently lacks clarity under the new Labour government. Researchers suggest that if implemented, it could discourage some law firms from engaging in lower-value claims.
With fewer firms willing to take on such cases due to financial viability concerns, and continued mergers and acquisitions, the number of claimant law firms is decreasing. This trend is expected to persist amidst competition for a limited number of cases, with larger firms being better positioned to manage the financial implications of delayed compensation.
The focus is predicted to shift towards alternative dispute resolution (ADR) strategies, which aim to expedite case resolution and reduce the burden on courts. This approach is likely to gain prominence in cases involving birth injuries, which constitute a major portion of claims’ overall value.
The decline in clinical negligence cases reaching court continued, with a notable drop from over 29% in 2018/19 to less than 19% in 2024. Contributing factors include routine NHS procedures postponed during the pandemic, compounded by ongoing staff shortages and strikes, potentially leading to increased patient harm and subsequent claims.
Legal actions related to artificial intelligence negligence are becoming a reality. Despite the undeniable benefits and rapid implementation of AI in healthcare, there exists potential for unexpected system failures, which may give rise to new realms of negligence claims.
The clinical negligence market is transitioning, with consolidation and emerging sectors offering new avenues amidst a decline in traditional NHS claims.
