...because this money will come from organisations paying compensation, it is likely to result in increases in premiums for compulsory employers' liability insurance.
The new rules allow the NHS to claim back money for treating people who have been paid personal injury compensation. Known as the NHS Injury Costs Recovery (ICR) scheme, the rules are an extension of - and replacement for - the previous scheme whereby the NHS could recover the costs of treating people injured in road traffic accidents (RTA) where they have successfully claimed compensation for their injuries.
Since the RTA scheme came into operation it has recovered around £115million per year for the NHS; the ICR scheme is expected to be worth around £150million or more per year.
When the new rules were launched, Andy Burnham, Minister of State for Delivery and Reform at the Department of Health, said: "Although this scheme will undeniably raise useful additional sums of money for hospitals, it is not simply about raising more cash. It is based on the legal rights of the NHS and the responsibilities of those to blame. We hope it will act as an additional impetus to improving health and safety.
"This policy will encourage employers to take steps to prevent employees being injured and, when implemented, should increase the total recouped each year to around £300million for the NHS. The scheme will not introduce any more extra regulations for businesses and will be based on the current RTA scheme.
"It is unacceptable that taxpayers have to pay for the medical treatment of someone injured at work simply because employers fail to take adequate steps to protect their workforce. Individual hospitals will now be able to recover the costs and decide where they want to reinvest that money to improve services they want."
Both the RTA scheme and the ICR scheme apply only to NHS treatment provided in NHS hospitals. The ICR scheme will also allow the recovery of the costs of ambulance services to take the injured person to an NHS hospital (which was not covered by the RTA scheme). Costs for providing primary care - for example, through General Practitioners - are not recoverable under either scheme.
As an indication of the sums of money involved, the current NHS Tariff states that 'without admission' treatment is subject to a flat charge of £505, 'with admission' treatment is £620 per day up to a maximum of £37,100, and each NHS ambulance journey is charged at £159. However, these charges are likely to increase on 1 April to take into account Hospital and Community Health Services (HSHS) inflation.
In order to maintain their profit margins, it seems most likely that insurance companies will increase the premiums they charge. It would therefore be prudent for employers to ensure that they maintain high standards of health and safety, preferably in such a way that they can demonstrate to their insurers that they have suitable systems in place. This way they will be in a stronger negotiating position - and may even be able to reduce their premiums.
Pilz Automation Technology has a consultancy division that works with companies to assess risks, formulate and implement competency management schemes, and run training courses to help raise standards.