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For the first time ever, the NHS will be able to recover costs from insurance companies for treating patients in all cases where personal injury compensation is paid. Hospitals are already able to recover the costs of treating people injured in road traffic accidents (RTA) where they have successfully claimed compensation for their injuries.

NHS costs are payable by the insurer that pays the compensation. Five years after the RTA scheme came into operation it is recovering around £105million per year for the NHS. It is expected that the expanded ICR scheme will recover an additional £150million per year once fully bedded in.

Rosie Winterton, said:

"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 £250m for the NHS - equivalent to 53, 000 hip operations and 11, 000 newly qualified nurses.

"It is unnacceptable 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.

"The scheme will not introduce any more extra regulations for businesses and will be based on the current RTA scheme. The consultation will give all those with an interest in the scheme an opportunity to comment on the way it will work in practice when it comes into effect next year."

The draft Regulations follow on from the legislative framework for the ICR scheme set out in Part 3 of the Health and Social Care (Community Health and Standards) Act 2003 and are contained in the consultation document, 'The Recovery of NHS Costs in All Cases Involving Personal Injury Compensation: a Consultation on the Draft Regulations'. This consultation is concerned with explaining the Regulations that will govern the new scheme and is divided into three areas:

The Law Commission carried out a wide-ranging consultation on expanding the RTA scheme to cover all cases of personal injury where compensation is paid in 1996, arguing that it would force those responsible for causing injury to others to pay the full cost of their wrong-doing, rather than being subsidised by the general taxpayer. Equally, it would encourage employers, public authorities and others with responsibility for the health and safety of others to take those responsibilities seriously and improve their health and safety practices. More than three quarters of the people who responded to the Law Commission's 1996 consultation agreed with the Commission's view that the NHS should be able to recover its costs from the liable party. 

TUC General Secretary, Brendan Barber, said:

"We welcome this consultation. It is important that negligent employers pay the full cost of their actions rather than expecting the taxpayers to subsidise their failures to protect workers. However it important that this is not just seen as another cost to be added to insurance premiums and instead is used by the insurance industry as an incentive to improve the measures that employers take to prevent injuries at work."