A Primary Care Trust recently argued that a woman injured in a road accident was not eligible to receive NHS care due to winning a payout from her insurer. Glyn Jones explains the facts and implications of this case.
In an important decision for the insurance industry and for claimants, Judge Pelling QC — sitting as a judge of the High Court in the Administrative Court in Manchester ≠‚Äî has rejected an argument by Oldham Primary Care Trust. The case in question involved road traffic accident victim Alyson Booker and insurer Direct Line, which was joined in proceedings as an interested party.
The PCT's argument was that, as Ms Booker had already received a multi-million pound payout on a personal injury claim from her insurer, it was entitled to withdraw care and funding for her case. Judge Pelling ruled that, despite this payout, the claimant was still entitled to free care and services on the NHS.
Ms Booker was seriously injured in a road accident in January 2001 when she was nine years old. She sustained a catastrophic spinal injury that left her tetraplegic and dependent upon a ventilator. Liability for the accident was not disputed and, therefore, following the commencement of proceedings, judgment was entered on a 100% basis.
Upon discharge from hospital, Ms Booker's care needs were met by a combination of her parents and staff provided by the PCT via its specialist children's home ventilation team. The PCT assessed that the claimant required two carers, 24-hours a day.
At the time of settlement, in October 2009, Ms Booker was in the process of transferring from the children's team to the adult one. All parties agreed that she was entitled to have a private care regime, funded by a periodical payments order. However, they also agreed there was a need for a transitional period, during which time the PCT's adult team would become solely responsible for her care needs — this could then become the template for a private regime.
Due to the number of carers involved, and the fact Ms Booker's ongoing care would be a lengthy process, it was agreed the PPO would commence in December 2011. An additional fund was set up to cover the cost of recruiting carers in readiness for the handover. The insurer also provided an indemnity in the event that PCT funding was withdrawn prior to December 2011.
However, Oldham PCT refused to be bound by the terms of the settlement and argued that it was entitled to withdraw its services — informing Ms Booker that it intended to do so from September 2010 (later extended to October). Following this, the claimant's legal team launched an application for judicial review with the support of the insurer, Direct Line, which was joined in the proceedings as an interested party.
Oldham PCT argument
The PCT argued that, because Ms Booker had chosen to be treated privately in the future, she could have been treated privately straight away; and, due to the fact she had an indemnity, she no longer had the need for its services.
In reaching its decision, Oldham PCT argued that the 'tortfeasor pays' principle was an exception to the fundamental principle that the NHS should be free to all, regardless of means. It saw that the lump sum settlement and PPO of £247 500 per year effectively gave it an opt-out to payment.
It also suggested that, as it had not been involved in the settlement, it was not bound by its terms and was, therefore, entitled to consider what the claimant could have claimed for. The PCT stated it had 'target duty' under legislation and so was entitled to take into account other cost demands made upon it.
Rejecting all of the PCT's arguments, the judge found its decision was not lawful or rational, as it was based upon Ms Booker's ability to pay. He stated that the tortfeasor pays principle was irrelevant to the trust's position and later identified how undesirable it was for PCTs to become involved in personal injury litigation.
While the judge agreed that target duty was relevant to whether a PCT could fund a particular type of treatment, this was not a case where the PCT had deemed Ms Booker's ongoing healthcare provision as low priority. He saw this as an attempt to exclude her from her entitlement as a direct result of her compensation payout, which was unlawful.
Significance of judgment
In this case the principle of NHS healthcare being free at the point of delivery was reaffirmed. However, the real importance of the judgment lies in what may have happened had Oldham PCT's argument succeeded.
The PCT stated that it could take account of what Ms Booker's 'entitlements as against a tortfeasor' were, but its argument was not restricted to care provision. The PCT also argued that Ms Booker should pay for the maintenance of her ventilators as well as the costs for their replacements plus all other consumables.
If the judge had agreed with Oldham PCT, this case would have held implications well beyond the serious injury claims arena, although its impact would have been greatest in this area. According to Judge Pelling, in every case where a claimant is left with a requirement for some sort of future NHS assistance, no claimant "could safely conclude settlement, other than on terms that the future assistance was privately funded and so funded from the date of settlement, without the prior consent of the PCT".
This would mean that claimants would be forced to include claims even though (as in this case) the intention was to rely upon NHS provision — significantly increasing the cost of claims. The legal process would also be significantly drawn out due to the claimant's desire to involve the PCT in the negotiations. This would increase costs considerably.
Additionally, the PCT made no distinction between full liability and split liability cases. A claimant entitled to only 10% of their damages would — under the PCT's logic — lose 100% of their NHS entitlement. Permission to appeal on this case has, thankfully, been refused.
Glyn Jones is national head of the catastrophic injury division at DWF and acted for Direct Line Insurance in this case
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