13. What should be provided free within healthcare
and what should be available for a fee has been continuously debated
since the introduction of charges in the early 1950s. There has
been extensive discussion of the services that the NHS should
provide. Rationing is already common: many Primary Care Trusts
(PCTs) meet the cost of only one cycle of in-vitro fertilisation
(IVF) treatment, for example, and eligibility criteria vary.
The provision of Herceptin, the newly licensed, expensive medicine
for early stage breast cancer, by individual PCTs has been a recent
topic of debate. Whether the NHS should extend its screening programme
to include other diseases has also been discussed.
Underpinning such rationing are considerations of the types of
care designated as 'essential'. As people's expectations of life
in general, and healthcare in particular, rise, it is perhaps
increasingly difficult to differentiate between essential care
and non-essential treatments.
14. The purpose of charges is twofold. They were
introduced in the late 1940s and 50s both to raise money and to
reduce demand. The then Prime Minister, Mr Attlee, justified the
legislation on prescription charges in 1949 as a means of reducing
unnecessary use of doctors' and pharmacists' time, "as a
deterrence against extravagance, rather than as an economy".
The introduction of dental and sight test charges had less to
do with health policy than with the need to pay for rearmament
prior to the Korean War.
Professor Peter Smith of York University stated:
User charges in health care have two broad roles:
to raise finance for the health system, and to send signals to
patients who would otherwise face a zero price for access to health
15. Although one of the purposes of charges is to
raise funds, Governments have never set a target to obtain a particular
proportion of the health budget from them. At present charges
for prescriptions and dentistry amount to just over 1% of the
total NHS budget.
16. The signals sent by charges indicate to patients
that the goods or services they receive are not without value
and therefore should not be over-used. They could be used to discourage
the wrong sort of behaviour; for example, patients could be charged
for non-attendance for appointments. As we have seen, Attlee believed
that prescription charges would reduce unnecessary demand for
17. The need to raise funds can send signals which
discourage best practice, however. The charges for prescriptions
for hospital day-case patients but not for inpatients are inconsistent
with the desirable switch from inpatient to community based care.
18. It is desirable both that fees should be set
at a level which does not deter patients from seeking or obtaining
essential care and that exemption systems are in place to protect
those on low incomes. Therefore the level of fees and the exemptions
should ensure that medicines and services can be used by everyone
when necessary but not used when other courses of action are more
19. The subject of exemptions raises many questions.
If the purpose of exemptions is to ensure that everyone gets the
treatment they need, should exemptions policy be designed specifically
to achieve this? For example, should there continue to be exemptions
based on age alone rather than income?
20. The charges currently levied by the NHS may lower
demand in that they reduce the numbers of patients obtaining their
medicines and visiting a dentist; unfortunately, on the other
hand, they may also stop patients from visiting their doctor,
pharmacist or dentist whenever they need care. If this occurs,
patients' health may suffer.
21. The evidence of the effects of reduced demand
associated with charges is of two main kinds: the first consists
of studies in which a population was observed before and after
the imposition of a charging regime. Much of this controlled research
was performed overseas. An experiment carried out in the US in
the 1970s by the RAND group, in which over 2,000 patients were
assigned to one of four types of charging regime, showed that
increasing charges resulted in consistently reduced use of healthcare
services, with associated cost savings and minimal health effects
on most of the socio-economic groups included. However, the study
also showed a seriously adverse effect on the health outcomes
of those with low-incomes who had chronic illnesses. The annual
risk of death related to hypertension, for example, was 10% greater
in this group.
22. The English evidence is largely of the second
type which consists of surveys and focus group work. A telephone
survey of patients from five countries including the UK concluded
that of individuals on "low incomes" in the UK 6% did
not obtain medicines after being issued with a prescription, or
complete courses of prescribed drugs due to cost, and 24% did
not consult a dentist for financial reasons.
There is also the testimony of organisations which work with individuals
who have problems paying charges, such as Citizens Advice. They
told us that they had seen, "people driven to below poverty
level" by health
charges. Difficulties increase when such individuals are the victims
of long-term illness:
From our point of view it is a combination of
people's chronic health problems and low income. It is when those
two things butt up against each other, that is the client group
that we find most often has problems with prescription charges.
23. Such evidence, like the evidence of surveys,
does not provide a firm basis for conclusions that can be generalised
to a large population. The English evidence base is very small
and the effects of charges in this country have not been systematically
assessed. Nevertheless, the general gist of the evidence is clear.
As Professor Donald Light informed us, charges have adverse effects
on the use of services, and this conclusion is supported by all
the available international evidence.
This is also the conclusion of the WHO, which has stressed that
charges deter use of services by the poorest and sickest in a
24. It appears difficult to protect vulnerable groups
that need effective and accessible healthcare but are less likely
to seek it, while limiting "unnecessary" demand among
other, usually wealthier and healthier groups, which might overuse
services. Charges do not readily differentiate between frivolous,
necessary and unnecessary use of servicesas a result, they
are a blunt instrument and are likely to have negative effects
on access to and use of services. Professor Peter Smith told us:
Unless carefully designed, user charges designed
to curb excessive demand amongst the bulk of the population could
have ruinous financial or health consequences for a relatively
small number of poor people with health problems.
25. Much of the debate about charges has focussed
on prescription medicines and dental and optical services, but
there are other costs involved in accessing healthcare, notably
car parking, and the introduction of new services to hospitals
such as bedside telephones.
We are considering them here because there is growing evidence
that these are of concern to many patients. Car parking charges
have become more important as changing medical practice means
that many patients have to attend hospital more often as day cases,
while bedside telephones are a recent development.
26. Below we discuss the charges for elements of
clinical care, namely medicines, dentistry and sight tests. This
is followed by an examination of charges for services provided
by hospitals that do not form part of clinical patient care, including
charges for bedside telecommunication and car parking.