"Whiplash" reforms - putting the cart before the horse?
Tuesday, 14th October 2014
On 1 October 2014 the 75th update to the CPR came into force, bringing with it further reform on ' RTA whiplash' compensation.
These amendments will apply to all soft tissue injury claims (not just whiplash injuries) commenced under the Pre-Action Protocol for low value personal injury claims in road traffic accidents where the claim notification form ("CNF") is sent in accordance with the Protocol on or after 1st October 2014.
Soft tissue injury is defined under the CPR as "a claim brought by an occupant of a motor vehicle where the significant physical injury caused is a soft tissue injury and includes claims where there is a minor psychological injury secondary in significance to the physical injury."
New Fixed Fees
Medical report fees are now fixed under P45 as follows (all figures are exclusive of VAT):
- First Report (any expert) £180
Additional medical reports may be obtained where 'justified' (CPR 7.2), whether from the first expert or from an expert in another discipline only where it is recommended in the first report and that report has been disclosed to the Defendant (7.8A (1&2)). Fixed fees for further reports are as follows:
- Consultant Orthopaedic Surgeon (inclusive of a review of medical records where applicable) £420
- Consultant in Accident and Emergency Medicine £360
- General Practitioner registered with the GMC £180
- Physiotherapist registered with the Health and Care Professions Council £180
- Addendum report on medical records excluding Consultant Orthopaedic Surgeon £50
- Replies to questions under CPR Part 35 £80
Medical Records Fees are also capped:
- Medical records to include no more than £30 for admin fees for each set of records required. n.b Data Protection cap is £50 charged by record holders; this applies to each separate record source. £80
If an expert is used who is not within the criteria set out above, fixed costs of the report will not apply and the use of that expert must be justified if the cost is to be recovered.
Note: Where the Defendant provides a different account of the accident the Claimant must provide that account to the medical expert as part of the instructions, so that any alternative expert opinion on diagnosis and prognosis is included in the report, depending upon which account is found to be true at trial (7.1A (3)).
Tactics: Defendants will now carefully review the Claimant's accident description in the CNF and, if that information is insufficient or contradicts the Defendant's version, ensure that the reply to the CNF includes their own insured's account of the collision and a request that this account is forwarded to the medical expert. This will be a more cost effective response than a challenge to the adequacy of information in the CNF (which will result in the claim falling out of the portal).
Pre - Medical Offers
This practice is discouraged by amendment of CPR P36 which provides new rules for claims which have fallen out of the portal (Part 36 does not, of course, apply to claims within the portal regime).
Offers made before the medical report is obtained are controversial and in some ways encourage fraud. The Government has not banned "pre-med" offers completely but Part36.10A now limits the costs risk on Claimants facing a P36 offer pre-report and states that: 'In a soft tissue injury claim, if the defendant makes a Part 36 offer before the defendant receives a fixed cost medical report, paragraphs (4) and (5) will only have effect if the claimant accepts the offer more than 21 days after the defendant received the report'.
A Claimant, therefore, is not at risk on the offer until 21 days after they disclosed the medical report to the defendant.
Fixed fees for medical reports may reduce costs but they do not help to improve the authenticity of whiplash claims or flush out spurious claims.
This will only occur if insurers have faith in the medical expert and have tighter control over the selection of experts. A 'panel' of approved soft tissue experts may yet be introduced.
Until the examination process is improved and experts are subject to accreditation, the legitimacy of many whiplash claims will remain in doubt. This is not good for Claimant or Defendants.
Medical report fees are fixed, regardless of seniority or discipline. Will only junior (less experienced) medical experts engage in this area of work? Will they spot fraudulent/exaggerated claims?
The modification of P36 in relation to pre-med offers may reduce the amount of pre-med offers made, but tactical and costs benefits for a Defendant in dangling an early settlement "carrot" in front of a claimant still remain.