Recovery of NHS Accident Costs: Tort as Vehicle for Raising Public Funds

Date01 November 1999
DOIhttp://doi.org/10.1111/1468-2230.00243
Published date01 November 1999
Recovery of NHS Accident Costs: Tort as Vehicle for
Raising Public Funds
Richard Lewis*
The Road Traffic (NHS Charges) Act 1999 and its regulations1enables a hospital
or trust which provides National Health Service (NHS) treatment for a victim of a
road accident to reclaim its costs from a compensator who pays damages to the
person injured. The scheme is parasitic upon that set up ten years ago to enable the
state to recover any social security benefit paid to an accident victim up to the date
of settlement of the tort claim.2However, the NHS scheme differs in that it applies
only to injuries caused by motor vehicles, and the costs recovered are returned to
the hospitals which provided the treatment – whereas the social security benefits
recovered go directly into Treasury coffers. The legislation is of considerable
importance in the administration of the tort system for its procedures must be taken
into account in the settlement of all personal injury claims. The reform is also
significant in confirming an approach to dealing with collateral benefits which
departs from notions of community responsibility for injury, and entrenches a
discredited liability system as a means of raising public revenue.
An injured person has never been able to obtain damages for NHS treatment
received free of charge. Nor, until recently, did those hospitals and others providing
the care seek to recover in an organised way from the compensator anything like the
full costs involved. (The old system for recovering limited sums is described under
the next heading). Where free health care was provided as a collateral benefit the law
traditionally adopted the policy of reduction: the plaintiff could obtain no damages
for treatment for which he did not pay, and the tortfeasor was not required to
reimburse the collateral source. The tortfeasor thus avoided paying for the full costs
of the accident. However, this policy of reduction has now given way to that of
recoupment: the 1999 Act requires the cost of treatment to be repaid under a tariff
scheme which makes use of the system already in place to recover social security
benefit. Both schemes of recovery are now run alongside one another and are
administered by the DSS’s Compensation Recovery Unit (CRU) based in Newcastle.
Although recovery of NHS costs affects only road accident victims, these
comprise the largest group of tort claimants for they bring between 40 and 60 per
cent of all personal injury cases.3The change does not directly affect the victims
ßThe Modern Law Review Limited 1999 (MLR 62:6, November). Published by Blackwell Publishers,
108 Cowley Road, Oxford OX4 1JF and 350 Main Street, Malden, MA 02148, USA. 903
* Cardiff Law School.
1 The Road Traffic (NHS Charges) Regulations SI 1999 No 785 and the Road Traffic (NHS Charges)
(Reviews and Appeals) Regulations SI 1999 No 786.
2 Now revised and set out in the Social Security (Recovery Of Benefits) Act 1997. See generally R.
Lewis, Deducting Benefits From Damages For Personal Injury (Oxford: OUP, 1999).
3
Forty per cent is the figure in the Report of the Royal Commission on Civil liability and Compensation for
Personal Injury, Cmnd 7054 (1978) vol 2, table 11. Similarly see P. Pleasence, Personal Injury Litigation In
Practice (London: Legal Aid Board Research Unit, 1998) 48 noting that in several recent personal injury
studies road accidents have comprised about half of the cases. In figures supplied to the author from DSS
sources for the six months to the end of September 1998 road accidents comprised 60 per cent of the 323,000
claims notified to the Compensation Recovery Unit. Road accident victims constitute an even higher
proportion of those who suffer serious injury. Of the 153 cases settled by insurers for £150,000 or more in the
two years 1987–88, 73 per cent involved people injured in road accidents. P. Cornes, Coping With
Catastrophic Injury (Edinburgh: Disability Management Research Group, University of Edinburgh, 1993).

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