A law passed in 2013, which would have forced firms whose workers have been treated for mesothelioma and other asbestosis diseases to repay the Welsh health service has been overturned by a Supreme Court ruling. It has been claimed that under the new legislation, hospitals in Wales would have been able to recover the much needed costs of treating asbestos-related diseases.

The Recovery of Medical Costs for Asbestos Diseases (Wales) Bill was introduced into the National Assembly for Wales by Pontypridd AM, Mick Antoniw on 3 December 2012. The Bill was subsequently passed by the Assembly on 20 November 2013.

Following objections from the insurance industry, who claimed that the law was outside of the Welsh Assembly’s power to pass, the bill had been referred to the Supreme Court by the Welsh government’s Counsel General.

“No right to impose charges”

At the Supreme Court, it was stated that Welsh ministers had “no right to impose charges to fund the NHS”, and “insurers should not be given extra liabilities for asbestos exposure which long predated the bill.” Consequently, the court unanimously found that the Bill fell outside the legislative ‘competence’ of the Welsh Assembly and was incompatible with the European Convention on Human Rights.

The judges pointed out that as a “matter of policy”, the Welsh NHS should be given provision to recover hospital costs from those who caused them to be incurred because of a breach of legal duty towards their employees. However, the judges also said that the provision is one “which could have been made by the UK at any time since the NHS was introduced… which would have been proportionate if introduced in relation to future exposure to asbestos and future insurance contracts.”

According to the court, it is “a quite different step” to rewrite “historically incurred obligations” which are to be imposed in relation to “future” Welsh NHS costs.

“Could have raised £1 million a year for the NHS”

Responding to the ruling, the Welsh government said it would give “careful consideration to this judgment”, while Assembly member Mick Antoniw, who first proposed the bill, said he was “gutted” at the ruling, having believed that the new measure could have raised £1 million a year for the NHS in Wales.

At the same time, the Association of British Insurers (ABI) welcomed the judgement, saying that “The Welsh Bill would have seen increased insurance premiums for Welsh businesses but no extra compensation for mesothelioma sufferers.”

Despite the ABI adding that “the insurance industry remains committed to doing all it can to help the victims of this terrible disease…”, in December 2014, the Ministry of Justice said it would set a lower rate for insurance industry funding of the Diffuse Mesothelioma Payment Scheme (DMPS), introduced six month earlier, which is thought will save the insurers £11.6 million.

At the time when the Mesothelioma Bill was agreed in parliament, eyebrows were raised at the exclusion of an insurer’s levy to fund future mesothelioma research while widespread disappointment and concern were also expressed over limitations imposed on actual victim payment amounts and eligibility, as a result of alleged insurer’s influence.

“Insurers had no legitimate interest”

Two of the Supreme Court judges also addressed remarks at the insurers saying that in their view, “insurers had no legitimate interest which prevents a state changing its charging policy for health care and replacing care free at the point of delivery with the imposition of charges.” They added that if insurers were to have a legitimate interest, then the scope of their interest would need to be closely looked at, especially at a time of government cutbacks.

In Scotland, one year on from when a similar Bill was first announced, allowing health boards to reclaim the costs from insurance companies for the care of workers with industrial diseases like mesothelioma, a consultation has been announced, which will take forward “The Recovery of Medical Costs for Asbestos Diseases (Scotland) Bill as a Member’s Bill at Holyrood.