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Health and Social Care levy won’t cover NHS negligence claims


By Jess Hacker
28 October 2021

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Money collected by the 1.25% increase to National Insurance risks being ‘swallowed up’ by the amount paid out in clinical negligence claims, the Government has been told.

In evidence submitted to the Health and Social Care Committee inquiry into NHS litigation reform, the Medical Defence Union noted that payments made to settle these claims stood at £2.26bn in 2020/21.

The controversial Health and Social Care levy, which was announced and approved by MPs in September, is said to collect £12bn a year intended to fund the NHS and social care.

The MDU estimated that the NI levy of 8.7 million people earning £30,000, and paying an extra £225 a year in tax, would be needed to fund the amount paid in claims.

Dr Michael Devlin, MDU head of professional standards and liaison, said: ‘Amounts being paid out in compensation annually are spiralling, increasing nearly 50% in the last five years from £1.48 billion to £2.2 billion last year. At the same time, funding is urgently needed for frontline patient care, to meet the demand for social care and to tackle the elective surgery backlog.’

He added that the Government must ‘grasp the nettle’ and reform the system surrounding clinical negligence so that it mirrors the country’s ability to pay.

The MDU suggested that reforms to the system for compensating patients could make a ‘significant difference’.

This comes as the Government announced a £5.9bn funding injection to help clear the Covid-caused backlog for care which now sits at around 5.7 million people.

Recent analysis conducted by the Health Foundation showed the Government will have to spend £17bn if it intends to return hospital waiting times to 18 weeks during this parliament.

Meanwhile, recent modelling by the Institute for Fiscal Studies found that concerns that the NHS waiting list could reach and exceed 13 million people are ‘well within the realms of possibility’.

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