In the first part of this summary of indemnity insurance in practice nursing, the author set out the ingredients of legal liability occurring as a result of the negligent treatment of a patient (Finch, 2019). We saw that it is not every instance of careless treatment causing harm to a patient which leads to legal liability.
In this second and concluding part, we look at the practical implications of having indemnity cover. The overall objective of indemnity insurance is to provide practice nurses with a cushion against a legal liability claim being successfully brought against them. Such schemes do not shift the legal responsibility for the nurse's actions away from the nurse. What they do is to take the financial responsibility away from the individual practitioner and to place the responsibility to pay compensation on the shoulders of the assurer. The nature of indemnity insurance is that of a simple contract.
Attention to legal liability is something that has occurred relatively recently in practice nursing. The Royal College of Nursing has taken some positive and very advantageous steps in the protection of nurses, including particularly those engaged in general practice, and from 1 April 2019, all nursing staff working in GP practices or providing GP services to NHS patients in England have automatically been included in the state-funded scheme operated by NHS Resolution, bringing those nurses working in GP practices in line with those employed by the NHS directly.
The overall objective of indemnity insurance is to provide practice nurses with a cushion against a legal liability claim being successfully brought against them
The view taken by legislation and the courts
Protection of workers against accidents at work has been evident in UK law since the early days of the industrial revolution in the nineteenth century. It was not until relatively recently that lawmakers and the courts have widened their focus to add economic effectiveness in terms of satisfactory compensation schemes for the victims of accidents caused by negligence to the well-established rules of legal liability. To work in a practice while feeling threatened by legal action is not good for anybody, neither practitioner nor patient.
To focus on this economic efficacy makes obvious sense, and always has done. That its arrival is relatively recent may be due to a combination of factors. Over the last 20 years there has been increasing social and media attention to human rights. There has also been an increasing awareness of the cost strictures from which the NHS on its present model is prone to suffer. The cost of compensation for accidents in medical and other clinical practice was recently quoted by NHS Resolution at £77 billion a year (NHS Resolution, 2018).
Indemnity schemes
NHS Resolution's new state indemnity scheme for general practice in England is called the Clinical Negligence Scheme for General Practice (CNSGP). All providers of NHS primary medical services will be covered under CNSGP, including out of hours providers. The scheme will extend to all GPs and others working for general practice who are carrying out activities in connection with the delivery of primary medical services, including practice nurses.
Another scheme of central importance to practice nurses is the scheme established by the Royal College of Nursing for its members. It is designed for nurses and with their practice requirements specifically in mind. The RCN website, which sets out and explains the indemnity scheme, is clear and helpful and contains several sections with FAQs. There is a highly practical and easy-to-follow podcast on the site by Roz Hooper, Head of Legal Services (Regulatory) which sets the scene for what follows.
Indemnity under the Royal College of Nursing scheme is available for self-employed, agency and bank nurse as well as for volunteers and ‘Good Samaritans’ (see Finch, 2019). The precise legal status of the practitioner seeking or verifying indemnity cover should be checked with administrators of the scheme.
Some uncertainty in the practice nurse's mind when reading the document might arise from the use, on its opening page of ‘may’ (cover certain types of accident) and ‘could’ (apply to certain types of practitioner). This is due to the fact that contracts of employment and agency agreements are products of the law, which has to apply in practice to a wide variety of arrangements. These are considered shortly.
It is emphasised that the summary set out in this article is no substitute for a full reading of the Royal College of Nursing scheme, and the reader is encouraged to refer to it in detail. The reasons for the reservations and qualifications in the document are explained by way of a statement of some basic legal principles applicable to this area of liability.
Employment and agency
A practice nurse may be employed by the medical practice in which (s)he works, or (s)he may be there by an arrangement with an agency. Equally, (s)he may be self-employed. It is important to make the distinction between employee and agent because the practical incidence of legal liability may differ between the two types of status.
‘The cost of compensation for accidents in medical and other clinical practice was recently quoted by NHS Resolution at £77 billion a year.’
In general, an employee is someone who can be told by the employer not only what to do but also how to do it. The legal relationship between an agent and the person or body which engages them is not so direct and normally involves more independence on the part of the agent as to how to carry out the task in question. A moment's reflection is enough to see that the employment relationship takes many forms and will very often imply some independence on the part of the employee. Such is the case with practice nurses. Their practice necessarily involves considerable scope for the exercise of independent professional judgment. They may be allotted certain tasks and be instructed precisely on how to do them. But, equally, it would be normal for the execution of the task in hand to be left to them and to them alone. In the case of engagement by an agency, the medical practice which takes on such a person may have guidelines, or even rules, as to how such-and-such a task is to be done.
The line between employer and employee, and principal and agent, tends to differ according to the precise terms and conditions of the contract, be it of employment or agency. Healthcare practitioners are, in law, free to contract whatever terms of work that are available to them. It is for this reason that the Royal College of Nursing scheme is prefaced by ‘could’ and ‘may’. It could not be otherwise.
The ‘scope of employment’
The concept of vicarious liability resulting from an employer/employee relationship entails the liability of the employer for harm unlawfully caused by an employee. It will come as no surprise to hear that an employer is legally liable for harm caused by an employee when the employer benefits from the relationship. What may well come as a surprise is the extent of UK courts' interpretation of the concept of ‘scope of employment’.
Decisions have gone against employers even when they have specifically forbidden their employee to do such-and-such a thing during their work, or to do it in a particular way. In one case a Bristol milkman was specifically forbidden by his employer to give people lifts on his milk float and, more realistically, to engage or accept help from others in making his deliveries.
He broke both the prohibitions in one move, by allowing an enterprising 11-year-old to ride on the float and to get on and off delivering the milk and collecting the empties. One day the milkman drove too close to the curb when rounding a bend and the boy received a severe ankle injury. Despite the dual breach of his employers' instructions the company was held to be vicariously liable for the boy's injury. The court's ruling stemmed not so much from logic as from the judges' sense of individual and social justice. The company was ordered to pay, being the ‘main deep pocket’ as they say in the US.
The reader may ask whether such a legal process removes liability from the shoulders of the nurse. It does not. Vicarious liability is an additional liability.
The person or body found liable to pay compensation for the harm is said to be ‘subrogated’ to the position of the wrongdoer. This means that, in theory, they can claim against the wrongdoer for the costs of the claim money paid out to the injured person. In practice this never happens. The same goes for insurance companies, including indemnity insurers, who have the right in theory to recoup the costs of paying out on the claim from the insured person. But in practice they never do because no sensible person would insure with them.
The legal position would be different were the insured to misrepresent something on the application for insurance cover which materially affected the risk undertaken by the insurer. In the context of practice nursing this matter could conceivably arise in relation to validation, which may involve levels of experience. It could also arise from assertions of qualifications or professional experience.
Readers are again urged to refer to their own indemnity documentation and to the terms of their indemnity scheme.
Indemnity provided by medical defence organisations
While catering principally for medical practitioners, some medical defence organisations offer associate cover for nurse practitioners. Certain schemes offer the facility of counselling, as well as the expected expertise in alternative dispute resolution, which has the beneficial feature of settling the matter in issue between the parties without involving a court of law.
Two vital differences between the UK and the US
The two vital differences between the UK and the US relate to the amounts of money awarded, and why they are awarded.
In the US damages are awarded by juries, in what can only be described as on the basis of sympathy with the victim and the view the jury takes of the perpetrator of the harm. Readers who have seen Erin Brockovich will recall the multi-million dollar award made against Pacific Gas and Electric for environmental pollution. An award of such a size would be difficult to imagine in the UK, though it is not altogether out of the question, depending on the number of injuries and their severity.
A second difference between the two legal systems is the practice of contingency fee arrangements in the US, whereby the lawyer for the successful claimant contracts with the client to receive an agreed percentage of the money awarded (Erin Brockovich, again). Such an arrangement is not permitted under UK law. What is permitted, and increasingly used in personal injury cases, is a conditional fee agreement whereby the claimant's lawyer agrees to be paid nothing if the action is unsuccessful.
Conclusion
The recent trend towards placing practice nurses in a just, fair and equitable work situation is greatly to be welcomed. It is unfair to expect practice nurses to work with the Sword of Damocles hanging over their heads. It does no good to them and no good to those whom they treat.
KEY POINTS
- The aim of the available schemes providing legal indemnity insurance for practice nurses is to make for comprehensive liability cover whatever the particular relation between the nurse and the pracice and its other members
- In achieving this objective there are steps in place which avoid a needless and unnecessary reduplication of cover. This avoids needless expense, both to the insurers and to the insured