State Claims Agency

The NTMA is designated as the State Claims Agency (SCA) when performing the claims management and risk management functions delegated to it under the National Treasury Management Agency (Amendment) Act 2000.

The SCA’s principal objectives are:

• To ensure that the State’s liabilities in relation to personal injury and property damage claims, and the expenses of the SCA in relation to their management, are contained at the lowest achievable level; and
• To implement targeted personal injury and property damage risk work programmes to mitigate litigation risk, in State authorities and healthcare enterprises, in order to reduce the costs of future litigation against the State.

The SCA’s remit covers personal injury and third-party property damage risks and claims relating to certain State authorities including the State itself, Government ministers, the Attorney General, healthcare enterprises, the Commissioner of An Garda Síochána, prison governors, community and comprehensive schools and various other bodies.

In October 2013 the Government delegated to the SCA the management of personal injury claims concerning the ingestion of the medicinal products, Celvepan and Pandemrix. In April 2014 the SCA’s remit was further extended with the delegation to it by Government of the management of personal injury and third-party property damage claims in respect of an additional 61 public bodies, bringing the total number within the SCA’s remit from 56 to 117.

Claims Management

The SCA’s claims management objective is that claims should be managed so as to ensure the State’s liability is contained at the lowest achievable level. This has the following practical implications:

• In cases where the State is considered liable or which involve an apportionment of liability, the SCA’s approach is to settle such claims expeditiously, in so far as it is possible to do so and on fair and reasonable terms; and
• In cases where liability is fully disputed by the State, all necessary resources are applied in the defence of such claims.

The SCA manages claims from their initial notification through to final resolution. Claims are investigated in a thorough and timely fashion in order to facilitate early decision-making in relation to liability and strategy.

In 2013 the SCA resolved 1,861 claims at a cost of €80.6 million and received 2,242 new claims. At end 2013 the SCA had 6,188 claims under management, an increase of 7.5 per cent from a year earlier. The estimated liability against all active claims was €1.2 billion, broken down as follows:

Source: NTMA

Personal Injury (Clinical) Claims

Clinical claims are managed under a number of separate schemes managed by the SCA. Under the main scheme – the Clinical Indemnity Scheme – the State has assumed responsibility for the indemnification and management of clinical negligence claims arising from the diagnosis, treatment and care of patients in public healthcare enterprises.

The SCA resolved 419 personal injury (clinical) claims during 2013 at a cost of €63 million.

The SCA achieved significant savings in the management of personal injury (clinical) claims in 2013. An independent actuarial assessment projected that €154 million would be required in 2013 to cover both the cost of resolving claims and managing ongoing active claims. The net cost, taking account of successful recoveries from third parties, was €119.7 million – a saving of €34.3 million or 22 per cent.

The SCA received 783 new claims in 2013. Surgery and obstetrics-related claims together accounted for approximately half of all new claims and three quarters of the estimated liability of all new claims due to the high values associated with obstetric-related claims.

At end 2013 the SCA had 3,061 clinical claims under management, with an estimated liability of €1 billion, compared with 2,652 active claims at end 2012.

This increase reflects a large number of claims relating to the Lourdes Hospital Payment Scheme and symphysiotomies in 2013.

Clinical claims received in 2013 – by speciality

Source: NTMA

Lourdes Hospital Payment Scheme

In July 2013 the Government approved the establishment of a new Scheme to compensate former patients of Dr Neary (Consultant Obstetrician) who underwent unnecessary bilateral oophorectomies in Our Lady of Lourdes Hospital, Drogheda. In order to qualify for redress the applicants must have undergone a bilateral oophorectomy, or the removal of a remaining single functioning ovary, performed when they were aged 40 years or over. The operation must also have rendered the applicant immediately menopausal and must have been medically unwarranted. The State Claims Agency was requested by the Minister for Health to draft and administer the Scheme.

One hundred applications were received by the SCA which has made 40 awards to date. Thirty-two applications were turned down as the applicants did not fulfil the eligibility criteria and five were withdrawn. Twenty-three further applications are outstanding, pending the submission of supporting documentation. Awards of redress of €60,000 – €100,000 were made to successful applicants. Legal and/or applications costs were paid to a number of successful applicants. These payments averaged €3,500 per applicant. A number of applicants chose not to seek legal advice and assistance was provided to these applicants by a SCA solicitor. It is expected that the Scheme will be concluded by end summer 2014.

Symphysiotomy Cases
Approximately 200 women have made claims against hospitals/maternity units seeking damages in respect of symphysiotomy operations carried out between 1945 and 1982. A symphysiotomy is a surgical operation, typically carried out by obstetricians, to enlarge the size of a mother’s pelvis in order to facilitate childbirth in cases of minor obstruction. The women’s claims allege that the symphysiotomies were wrongfully carried out and/or were carried out without proper consent and have led to long-term side effects. Currently, the SCA is managing approximately 111 symphysiotomy claims.

Cost of Claims Resolved
The average cost of personal injury (clinical) claims resolved in 2013 (including awards/settlements and related legal and other costs) was €154,000 compared with €56,000 in 2009. This increase is mainly due to the fact that claims affecting 2,500 consultants, which previously would have been handled by medical defence organisations, were admitted by the Minister for Health to the SCA’s Clinical Indemnity Scheme from February 2004. Inevitably, this has resulted in a significant increase in the number and severity of claims. In obstetric cases, particularly those involving brain injury to infants, there is typically a period of five to seven years between the date of the adverse event which gives rise to a claim and the date of resolution of the claim.

An additional factor in the higher average cost per claim was the High Court decision, in a 2009 precedent case, to increase by 38.5 per cent the level of general damages in catastrophic injuries cases from €325,000 to €450,000. Legal fee costs have increased in conjunction with award/settlement costs. The table overleaf reflects costs relating to the Clinical Indemnity Scheme (CIS) only.

Figures may not total due to rounding.
Source: NTMA

How Claims are Resolved
In cases where the SCA investigation concludes that the relevant State authority bears some or all liability, it seeks to settle claims expeditiously on fair and reasonable terms. If it considers that the State is not liable, the SCA’s policy is to apply all necessary resources to defend the claims.

The SCA resolves the majority of cases by negotiating a settlement, either directly with the plaintiff’s legal team or through a process of mediation: fewer than 3 per cent of clinical negligence cases handled by the SCA result in a contested court hearing.

The SCA advocates mediation as a preferable alternative to the adversarial courts system for resolving clinical negligence cases. In 2013 the SCA settled 19 clinical negligence cases by mediation, representing a three-fold increase on the prior year.

As the portfolio of clinical claims matures year on year, the number of agreed settlements as a proportion of the total is expected to continue to rise as it has done between 2009 and 2013.

How CIS claims were resolved 2009 to 2013

Figures may not total due to rounding.
Source: NTMA

Personal Injury (Non-Clinical) and Third-Party Property Damage Claims
The SCA resolved 1,442 personal injury (non-clinical) and third-party property damage claims during 2013 at a cost of €18 million.

The SCA received 1,459 new claims in 2013, the primary causes of which were road traffic accidents; slips, trips and falls; and injuries caused by a person. These categories together accounted for some 60 per cent of new claims received and a similar proportion of the estimated liability of all new claims.

Claims by members of the public constitute the largest public liability category. Claims by HSE staff constitute the largest employer liability category.

At end 2013 the SCA had 3,127 claims under management, with an estimated liability of €186.7 million. The level of claims under management has remained broadly stable since 2011.

Cost of Claims Resolved
There was an increase in the average cost per claim in 2013 relative to previous years due to the effect of the maturing of HSE claims which were delegated to the SCA in 2010 (see table overleaf). A number of high value HSE claims were resolved in 2013.

Figures may not total due to rounding.
Source: NTMA

Voluntary Hospitals move to State Indemnity
As of April 2014 the Voluntary Hospitals’ Group (VHG) no longer purchases commercial insurance to cover its employer liability, public liability and property damage exposures. Instead, these claims are managed by the SCA on a “pay-as-you-go” basis, in keeping with Government policy of achieving Exchequer savings by self-funding these claims instead of paying insurance premiums.

The cost of VHG claims in the short term is expected to be minimal, mirroring the experience of the HSE following its move to State indemnity cover in 2010/2011. Between 2010 and 2013 the HSE would have paid premiums of circa €84 million but actual claims in the same period have amounted to just €10.8 million, representing cash flow savings of approximately €73 million. Based on the HSE’s current profile of its claims liability over the next decade, a saving of at least €30 million is expected to be achieved for the State from the management of those claims by the SCA.

It is estimated that the move to State indemnity by the VHG will provide an immediate cash flow saving of €4 million to the State and as the claims portfolio matures a saving of €2 million per year thereafter.

Cost Saving Initiatives

The level of legal costs paid to plaintiffs’ legal representatives is carefully examined and, wherever possible and by means of negotiations, the SCA seeks to achieve the maximum possible reduction in legal costs. If the SCA cannot successfully agree the level of legal costs to be paid to plaintiffs’ legal representatives, the matter is determined by a Taxing Master.

Source: NTMA

 The SCA vigorously pursues all available money recoveries in accordance with best claim practices and as permitted by law. One such example is the recovery of monies by means of third party/co-defendant contributions. Whether by adjudication of the court or agreement with the third party/co-defendant, a specified percentage contribution in relation to a particular claim may be paid by the third party/co-defendant to the SCA. Additionally, in certain cases, an indemnity in full may be received from a third party/co-defendant.

Source: NTMA

The State Claims Agency, in an initiative designed to reduce barristers’ fees, invited barristers to tender competitively for their services in 2012. This tender competition follows the success of a similar initiative by the SCA in 2011 which reduced the costs of fees paid to solicitors by some 25 per cent.

Some 1,000 individual tenders were received across six panels and twelve Circuits countrywide, in response to the tender competition. The new barristers’ panels were put in place in January 2013 and are expected to yield legal costs savings in excess of 25 per cent, on an annual basis.

Legal Costs Unit

In 2012 the Government decided to establish a Legal Costs Unit (LCU) within the State Claims Agency to deal with third-party costs arising from certain Tribunals of Inquiry. Pending the enactment of the NTMA Amendment Bill 2014, the LCU has been established on an administrative basis to consider and adjudicate on bills of costs presented for payment by third parties who were awarded their costs by the Mahon and Moriarty Tribunals.

Approximately 220 costs orders have been made in respect of the Mahon Tribunal. The LCU received 104 costs claims to end May 2014 with a total value of €8.53 million. Seventy-three of these claims amounting to €3.53 million have been negotiated and agreed at €1.96 million without the necessity for taxation, representing a saving of approximately 44 per cent.

A further 125 costs orders have been made in respect of the Moriarty Tribunal. The LCU received 27 costs claims to end May 2014 with a total value of €8.55 million. Twenty-four of these claims amounting of €2.86 million have been negotiated and agreed at €1.41 million without the necessity for taxation, representing a saving of approximately 50 per cent.

The Legal Costs Unit continues its robust approach to the management and resolution of bills of costs by way of negotiation and, where necessary, through the taxation of costs system, in an effort to deliver significant savings to the Exchequer.

Risk Management

The “risk universe” indemnified by the State and managed by the SCA is extensive. For example, it includes over 200,000 State employees and all public healthcare service users (public healthcare has approximately 7 million contacts with members of the public per annum). It also includes public services that, by their nature, constitute higher risk activities such as the provision of clinical care in hospitals, Defence Forces personnel on operations overseas, members of An Garda Síochána on operational duty, customs inspections, emergency response services and custody of prisoners.

The SCA’s risk management objective, and statutory duty, is to advise and assist State authorities and healthcare enterprises on measures to be taken to prevent the occurrence, or to reduce the incidence, of acts or omissions that may give rise to personal injury, property damage or medical negligence adverse events that could subsequently result in claims. The SCA’s clinical risk management programme focuses on collaboration with risk managers and other personnel in healthcare enterprises to support patient safety. The personal injury and property damage risk management programme focuses on providing advice and support to State authorities and healthcare enterprises within its remit in relation to risk management structures, maintenance of buildings, fire safety, health and safety and environmental management.

Specifically, the SCA provides a range of practical risk management services and advice to include:

• The hosting of the National Adverse Events Management System (NAEMS), a web-based database which facilitates direct reporting of adverse events by State authorities and healthcare enterprises;
• The analysis of adverse events and claims data and the provision of this analysis to State authorities and healthcare enterprises in order to identify risk clusters;
• Publication of risk management guidance and the provision of practical risk management tools;
• The provision of information and training by means of seminars and publications, including the SCA website and newsletters;
• The provision of risk management solutions directly to State authorities and healthcare enterprises in respect of specific risk issues;
• Carrying out risk management reviews and assisting with the development and implementation of State authorities’ risk management policies and procedures;
• Supporting the implementation of SCA’s recommendations issued to State authorities; and
• The provision of insurance, indemnity and liability advices to State authorities and healthcare enterprises.

Each year, the SCA carries out litigation risk management work programmes in association with client State authorities and healthcare enterprises. Some significant risk management projects undertaken during 2013 are summarised below.

Open Disclosure
The SCA, in conjunction with the HSE, piloted a significant Open Disclosure project in two major acute hospitals. This is a patient-focused project which seeks to establish an open and consistent approach to communicating with patients and their families when things go wrong in healthcare. It includes expressing regret for what has happened and keeping the patient informed. It also provides feedback on investigations and the steps taken to prevent a recurrence of the adverse event.

Following widespread consultation, the National Policy and Guidelines on Open Disclosure were published by the Minister for Health at a national launch on 12 November 2013 at Farmleigh House.

Open Disclosure has now been rolled out to 47 healthcare enterprises countrywide. E-Learning training is being developed for publication on the HSE intranet and formal external evaluation of the pilot project has commenced.

Visitor Safety in the Countryside Group
The SCA and a number of State bodies responsible for the management of national monuments, parks, historic houses, recreation sites and inland navigable waterways across the island of Ireland, as well as for policy development, have joined forces in a new initiative to improve the safety of visitors to their sites. The bodies have become members of the Visitor Safety in the Countryside Group, now a cross-border and UK organisation which aims to enhance safe access to the countryside and hundreds of sites across the country in ways that do not spoil the landscape and heritage or lessen visitors’ sense of exploration and adventure.

National Adverse Events Management System

All State authorities and healthcare enterprises within the SCA’s remit are legally obliged to report all adverse events that have occurred to the SCA. To facilitate this, all adverse personal injury, clinical and third party property damage adverse events can be reported by means of the web-based National Adverse Events Management System (NAEMS) which is hosted by the SCA for the benefit of State authorities and healthcare enterprises under its remit. NAEMS is the primary recording and management system for all adverse events that occur throughout the public healthcare system.

The NAEMS database provides key information at national and local level to assist in identifying and managing personal injury, clinical and third-party property damage risks. It helps the SCA to identify and analyse developing adverse trends and patterns and assists with claims investigation and management. It is also used by the SCA’s actuaries to calculate the current and future monetary liabilities of the various claims schemes. State authorities and healthcare enterprises with access to the NAEMS web portal use the system to identify clusters of adverse events and perform root-cause analysis at a local level.

The NAEMS underpinned the establishment of the SCA and its various indemnity schemes and provided a national clinical adverse event reporting and management system that was the first of its kind in Europe.

The SCA, in conjunction with the Department of Health, HSE, voluntary health enterprises, Irish Prison Service (IPS), Defence Forces, An Garda Síochána and other key stakeholders commenced a project in 2013 to significantly upgrade NAEMS.

The upgraded system will provide the SCA with an enhanced claims management system and all of the SCA’s client authorities and health enterprises with a “state of the art” end-to-end adverse event management system. The system has powerful data reporting and analytical tools that will allow for initial incident reporting, capture of investigation recommendations and their assignment and tracking to close. It will provide a national, standardised and cost effective solution across the State bodies to enable them to report and manage adverse events.

The project went live for 117 of the 119 State authorities within the SCA’s remit in June 2014. The roll-out to healthcare locations and the IPS commenced in June 2014 and is expected to be complete in Q2 2015.