Select Committee on Health Third Report


27. Compared to other Organisation for Economic Co-operation and Development (OECD) countries, health charges in the UK are low.[31] However, the money raised by charges—approximately £1 billion per annum—is one of the principal reasons for maintaining the regime. The former Health Minister Jane Kennedy MP stated that, "the contribution that prescription charges makes to the health service is a valuable one".[32] In this chapter, we outline the level of the charges that are in place and their effect on patient behaviour, health and access to care.


28. Patients pay £6.65 for each item on a prescription. Prescriptions are often written for one month of treatment only to reduce wastage of potentially expensive drugs. 50% of individuals must pay the prescription charge but only 13% of prescriptions dispensed actually incur a payment.[33] Prescription charges account for approximately 6% of the NHS drugs bill, raising £427 million each year.[34] Although there are many exemptions to charges, levels of prescribing are low in the UK compared to other developed countries.[35] Administration of the prescription charge system is also fairly inexpensive, costing approximately £7 million each year in England.[36]

29. Prescription charges, like charges in general, reduce demand. When the prescription charge was abolished in Italy in January 2001, overall spending on medicines rose by one third.[37] The Welsh Health Minister, Dr Brian Gibbons, told us that he expected demand to rise in Wales as the prescription charge was phased out.[38] The reduction in demand has both positive and negative effects. The Royal Pharmaceutical Society of Great Britain (RPSGB) pointed out that the increase in demand seen with free prescriptions may represent inappropriate use but it may also indicate that people had not previously been getting the medicines they needed because of the cost.[39]

30. There is international evidence that this is the case. US research into the effects of limiting state payment for schizophrenic patients' medicines showed that the use of antipsychotic drugs and antidepressants fell immediately after the cap was imposed. Visits to community mental health centres increased by one or two visits each month and visits to A&E rose sharply. Removal of the spending cap after 3 months restored the use of medication and mental health services to previous levels. The authors estimated that the increase in costs per patient was £1,530, the outlay being 17 times greater than the savings made in the cost of medication.[40] A Canadian study, which looked at the effect of requiring the elderly or those receiving benefits to contribute more to the cost of medicines, found that there had been detrimental effects on health.[41]

31. There is no UK equivalent of such studies, but there are other smaller scale surveys that indicate problems with health charges. A survey of Citizens Advice clients conducted in 2001 showed that 28% of those liable for the prescription charge did not have their medicines dispensed in full.[42] Of this group, 38% were single parent households and 37% had long-term conditions; for these patients the price of prescriptions is obviously a serious problem.[43] A MORI survey of people in England and Wales estimated that 750,000 people did not have their prescriptions dispensed each year because of cost.[44] Dr Hamish Meldrum, from the BMA, stated:

    There is plenty of evidence…that people for whom it would be appropriate to attend the doctor are dissuaded from doing so because of the thought of charges.[45]

32. The mechanisms people use to cope with the cost of prescriptions may affect health. We were told that patients often ask which of the items on a prescription is most critical to their health.[46] Those unable to pay the prescription charge may substitute their prescribed item for a cheaper over-the-counter (OTC) medicine. This may be adequate in some cases, but Dr Ellen Schafheutle from the Drug Usage and Pharmacy Practice group (DUPP) at the University of Manchester pointed out that, as a result, patients sometimes do not receive "clinically important" medicines or may not choose the item that is of most benefit. For example when asthmatics were given the choice between a long-term preventative inhaler and one that gave immediate relief, patients were more likely to choose the latter even though it did not treat the cause of the condition.[47] Mind,[48] Professors Light and Lexchin[49] and the Kings Fund argued that patients who did not receive pharmaceutical treatment early on were more likely to have more severe health problems later and that there were likely to be increased costs to the NHS. Dr Anthony Harrison stated:

    Studies have confirmed that hospital admissions may rise as a result of people not taking up prescriptions because of costs and they may find themselves going to their GP or doctor more frequently.[50]

33. Though this is valuable evidence, and enough to reinforce concerns about the negative health effects of charges, we have little idea of the scale of the problems associated with prescription charges. The evidence that exists on attitudes to charges, or their effect on patient behaviour and decisions to seek and obtain medical treatment, is also limited.[51] Ministers did not seem to be aware of the studies that have been done to date, and stated that they did not intend to request that work be undertaken in the future.[52] Jane Kennedy said:

    We have no plans at the moment to commission any further evidence, but we want to consider that in the light of what the Committee might say.[53]

34. There is also little evidence about the extent of frivolous or inappropriate prescribing related to free prescriptions. We were told of GPs being badgered to prescribe OTC medicines to save patients paying the prescription charge. The DUPP told us that patients who routinely received prescribed medicines were more likely to request products for the relief of minor ailments on prescription than those who are not exempt.[54] Researchers also found that when medicines were deregulated from prescription-only status to pharmacy status, as is increasingly common, exempt patients were more likely than others to seek a prescription for these products than to buy them. According to the BMA, it is common for parents to request a free prescription for Calpol, or its generic equivalent, from their GP when their child has a cold, rather than buying it directly from their chemist.[55]

35. One of the fundamental difficulties of this inquiry is that there is little hard evidence about public attitudes to charges or how charges affect the use of services in the short term or health in the long term. We found remarkably little evidence about the extent to which charges reduce 'frivolous' demand or free prescriptions encourage it. We recommend that evidence is gathered on

  • public attitudes to health charges,
  • the extent to which charges affect the use of health services and, in the long term, health,
  • the extent to which charges reduce 'frivolous' demand.


36. Total public spending on dentistry is around £1.8 billion each year in England.[56] Of this sum, dental charges raise approximately £483.6 million.[57] According to the BDA, between £1.3-2 billion is spent on dentistry in the private sector.[58] The amount raised by the NHS has risen steadily, in real terms and as a percentage of the costs, since 1952.[59] Between 1980 and 1998 the maximum dental charge rose from £30 to £340. The cost of administering dental charges is low, at approximately £0.4 million.[60]

37. There was much criticism of dental charges in the past, mainly because of the complexity of the charging system. Until recently, patients could be charged for over 400 different 'items'. A new dental contract was introduced on 1 April 2006. One of the main criteria for the new contract was that the same level of income be generated from charges as before.[61] Charges were simplified under the new regulations; now there are only three bands of pricing:

  • Band 1 (£15.50) for a preventative course of treatment (which might include an examination, a scale and polish, x-ray and advice);
  • Band 2 (£42.40) for dental interventions (fillings or restorative treatment);
  • Band 3 (£189.00) for complex treatments including fitting dentures and crowns.

38. Traditionally, a dental check-up was recommended for everyone every six months. Recent guidance from the National Institute of Health and Clinical Excellence (NICE) on recall intervals indicated that it was unnecessary to have check-ups as often as that; rather the dentist should use their clinical judgement to decide when to recall patients.[62] The Department has emphasised this guidance alongside the new charges regulations and expects it to reduce the frequency of visits.[63] The proposed future activity level is 5% less than at present.

39. It is claimed that the new banded system of charges is far simpler for patients to understand, and easier to administer. Nevertheless, there are a number of problems with the new contract. Firstly, it is feared that dentists will treat fewer NHS patients because they consider re-imbursement inadequate. Secondly, although the maximum charge for NHS dentistry has fallen, the price of some individual 'items' has increased; for example the BDA said that a partial denture was more expensive now than previously. [64]

40. Thirdly, according to the British Dental Association (BDA), a vital area is missing from the contract, namely "the drive towards prevention".[65] The BDA was concerned that preventative care did not receive any major focus during the contract renegotiations. The old dental contract was often criticised for encouraging 'drill and fill' rather than prevention and we were told that the new contract did nothing to allay this criticism. Preventative care does not attract Units of Dental Activity (the reference for how activity and payment are determined), meaning that there is no incentive for dentists to spend time with patients providing, for instance, oral health advice (eg. how to floss and use a toothbrush properly). Dentists are therefore more likely to continue to 'drill and fill'.[66] Other preventative measures, such as sealants cost more now than under the old contract. There are also concerns that patients will delay check-ups, or 'store up' fillings to save money.[67] The Minister responsible for dentistry, Ms Rosie Winterton MP, was doubtful:

    I find it very difficult to think that people would say, "If I hang on six months to get another filling, I can get that one in the same band."… I do think that if people were in that bad a position there would be assistance given through the various schemes.[68]

41. Under the new contract, the cost of replacing dentures that are lost or damaged will be 30% of the highest of the three bands of payment (approximately £57). Previously this charge was around £100.[69] However, dentures that need to be replaced due to wear and tear will be subject to the highest charge (£189). Age Concern were worried that the high cost would mean people would hang on to dentures longer than they should.[70] It could be argued that the renegotiation of the dental contract was an opportunity to address the situation that has been missed. On the other hand, the Minister observed that the replacement of dentures due to wear and tear had always been charged at a higher level than those that were lost or damaged.

Sight tests

42. Over 17 million sight tests were carried out in 2003-04 in the UK.[71],[72] These include both NHS tests which conform to a protocol agreed with the Department and private tests which may be more or less extensive than the NHS test. A high percentage of tests are provided free: around 11.7 million (all NHS tests) are paid for by PCTs and their equivalents;[73] the rest are either private or NHS tests which people who are not eligible for a free test pay for directly. The NHS sight test currently costs £18.39, but the General Ophthalmic Services contract will be renegotiated this year and the price of the test is likely to rise.[74] A survey carried out by the Federation of Ophthalmic and Dispensing Opticians (FODO) found that the average cost of a private sight test was £17.68.[75] The amount spent annually by the Government on free tests in England was £178 million in 2003-04; spending by patients was approximately £106.08 million. According to the Department, the cost of administration of the NHS sight test is low, at around £1 million a year.[76]

43. Free universal eye tests were abolished in 1988.[77] Full screening of school age pupils does not now take place everywhere in the country. However, free tests for the over 60s were reintroduced in 1999. There has been a 68% real terms increase in Departmental expenditure on NHS sight tests between 1994-95 and 2004-05 (see table below).


Financial Year
Total gross
expenditure1, 2, 3
Cost of sight
test provision4
Cost of glasses

Health and Social Care Information Centre
1. Expenditure is on a resource or accruals basis
2. Revalued to 2004-05 prices using GDP deflators (December 2005)
3. Includes; cost of grants to supervisors of ophthalmic optical graduate trainees, not counted in the cost of sight tests or the cost of glasses provision.
4. An estimated proportion of total expenditure based on more detailed breakdown of costs available in same year's cash monitoring data. Comprises fees paid to ophthalmic opticians and ophthalmic medical practitioners, including payments for domiciliary visits, help given towards private sight tests and employers' superannuation contributions.
5. An estimated proportion of total expenditure based on more detailed breakdown of costs available in same year's cash monitoring data. Comprises the cost of vouchers and repairs and replacements.
6. The consistency of data may have been affected by the changeover in accounting responsibilities from Strategic Health Authorities to Primary Care Trusts from 1 October 2002. Cost of sight tests and glasses estimated, assuming same proportions as in 2001-02.

44. The opticians' groups that appeared before the Committee did not consider that there needed to be changes to the charging system.[78] Rather they stressed the need for greater awareness of the importance of eye health and preventative eye care. Their main concern was the consequence of failing to undergo a sight test, which increased the risk of serious eye disease, particularly in vulnerable groups. Failure to screen children at the appropriate age can also have serious consequences.[79] The International Glaucoma Association (IGA) stated that some racial groups were particularly at risk of certain eye conditions, and that these groups often do not use chargeable NHS services:

    A prime example of this are people of African Caribbean origin who are more prone to developing glaucoma than the Caucasian population…such glaucomas tend to be more difficult to control effectively, making early detection even more of a priority if vision is to be preserved for life.[80]

Dr David Cartwright, of the College of Optometrists, pointed out the importance of diagnosing eye disease early as a means of preventing sight loss later in life, and of saving the NHS money. A patient with glaucoma, for example:

    …is not immediately aware that their vision or the visual fields might be getting worse until it is often too late to treat. So it is essential to diagnose that early and treat it early and that would lead to savings later on in the ongoing care of that patient.[81]

45. It is unclear whether charges have much effect on whether those at risk undertake eye tests. Abolition of the free sight test in 1988 was followed by a decrease in the number of tests performed[82] and levels of referrals from opticians to hospital ophthalmologists fell significantly after the sight test fee was introduced.[83] On the other hand, the overall number of sight-tests received by the over 60s did not increase significantly when free tests were reintroduced in 1999, suggesting that older adults were not deterred from undergoing a test by the charge.[84] Opticians' groups also doubted whether cost was a major reason why people did not have tests. The Minister agreed that people were unlikely to be deterred from visiting their opticians by cost:

    There is no evidence that people, frankly, just do not go because they could not afford it.[85]

She also agreed that identifying groups particularly at risk for eye disease was more important than encouraging more people overall to seek a sight test.

46. Age Concern, Citizens Advice and others were concerned that the value of the vouchers provided by the NHS to cover, or contribute to, the cost of spectacles was too low. There is a gap between the value of the voucher and the cost of spectacles and contact lenses at some opticians. According to Citizens Advice:

    If you are living in a rural area where you cannot shop around so easily, you could well find that your local optician just does not provide them within [the value limit] and you have got to find the difference, which then immediately brings you below the Income Support level. You may then decide maybe, "I can't afford to go to the optician's at all"[86]

47. In written evidence opticians groups agreed that patients could not afford to buy expensive glasses with the vouchers:

    The allowances [for spectacles vouchers]…are insignificant against the actual retail cost of these expensive lenses.[87]

However, in oral evidence the Association of Optometrists (AOP) stressed that, "there is plenty of opportunity to buy spectacles within the voucher value".[88]

Additional charges for clinical services

48. During the inquiry we heard about the increasing number of charges for clinical services which may have an effect on health outcomes and patient wellbeing. We looked at evidence in respect of two: the Jentle Midwifery scheme at Hammersmith Hospitals Trust and the dermatology clinic run by Harrogate and District NHS Foundation Trust (see boxes below).

49. The Jentle Midwifery scheme was introduced in 2004 to give one-to-one midwife care to women throughout the course of their pregnancy and after delivery. The National Service Framework (NSF) for Maternity Services states that such care should be the national standard.[89] Few hospitals at present meet the NSF; the Jentle scheme attempts to do this but only for those who can pay £4,000, plus a number of other women with particular needs.

50. The advantages of the scheme are that a small number of women, both those who pay and those with special needs who are subsidised by the women who pay, get a high class service that otherwise they would not receive. It is argued that there are not the funds to provide the service in any other way.

51. Several witnesses, however, objected to the scheme. The main objections are first that better NHS care which affects health outcomes is being made available to those who pay. Secondly, the scheme provides private care on the cheap; it would be more acceptable if the scheme were clearly in the private sector and the women who used it paid the full cost.[90] The money raised in this way could be used to fund NSF services for those who need it. Dame Gill Morgan of the NHS Confederation said the scheme made her "slightly uneasy" and described it as an "uncomfortable situation":

    The challenge for schemes like this is that they are right on the cusp between the private sector and the NHS which makes it, I think as you have been exploring, really quite difficult to know how far people will take them.[91]

Jane Kennedy agreed that the situation at Queen Charlotte's and Chelsea Hospital made her "uncomfortable", as women pay for a service that should be available as standard from the NHS.[92] She said that she had asked for an investigation to be carried out following evidence received by the Committee on the scheme.

52. The dermatology clinic run by Harrogate and District NHS Foundation Trust (see box below) caused less concern than the Jentle Midwifery Scheme, because it provides treatment that is no longer available on the NHS in that area and because patients pay the full cost of treatment. Nonetheless, the clinic operates from the main hospital and is run by NHS employees. There may be questions about the use of management and other staff time.

53. The dermatology clinic in Harrogate and the Jentle Midwifery scheme in London differ significantly. The former involves charging for purely cosmetic procedures while the latter charges a fee for services that should be available, according to the National Service Framework on maternity services, as standard. The Jentle Midwifery scheme provides cut-rate private care within an NHS hospital. This is unacceptable. Essential care of this type should be given to all or paid for privately at full cost.

31   OECD 2001 Back

32   Q 564 Back

33   Ev 1 Volume II Back

34   Q 3 Back

35   Those with lower prescribing rates include Australia, Greece and the Scandinavian countries. OECD 2001 Back

36   This includes administration of the Prescription Pre-payment Certificate and the NHS Low Income Scheme (described later) Back

37   Ev 77 Volume II Back

38   See Annex 1 Back

39   Q 139 Back

40   Soumerai et al. New England Journal of Medicine 1994; 331:650-655 Back

41   Reduced use of essential drugs occurred (15% among the elderly group, 23% among those on benefits), alongside a higher rate of serious adverse events (mortality, hospitalisation, nursing home admission) and an increased rate of admission to A&E. Tamblyn et al. Journal of the American Medical Association 2001; 285, 421-429 Back

42   The survey included 1602 people who had paid prescription or dental charges in the last year. Citizens Advice reported that 28% of these people did not have their prescription dispensed due to the cost. See Unhealthy Charges, published by Citizens Advice 2001.  Back

43   Ev 143 Volume III [cited in evidence from the All Party Group on Primary Care and Public Health] Back

44   Ev 137 Volume III 1,052 adults were interviewed by MORI in 150 sampling points in Great Britain from 6-10 April 2001. The results were extrapolated Back

45   Q 172; see also Q 216, Martin Rathfelder from the Socialist Health Association (SHA), who told us: "If you make a charge on something…then the consumption of those items is likely to reduce amongst the population least able to afford them. If we are serious about encouraging people less able to pay to use the Health Service, then forcing them to come up with [£6.65] every time they have a prescription seems counterproductive" Back

46   Qq 148,149, 151. According to the BMA, this is a "very frequent occurrence…[happening] once or twice a week". Dr Schafheutle said that GPs and pharmacists probably underestimate how often this occurs Back

47   Q 159 Back

48   Q 281 Back

49   Ev 94 Volume II Back

50   Q 142 Back

51   Eg. the subject has never been included in the British Social Attitudes Survey Back

52   Q 632 Back

53   Q 634 Back

54   Ev 92 Volume II Back

55   Q 154 Back

56   Q 328 Back

57   Written evidence to the Health Committee, Public Expenditure on Health and Personal Social Services 2005, HC 736. This represented the income from charges collected within the General Dental Service. Charge income collected within Personal Dental Service pilots was not separately identified in NHS accounts before 2005-06.The Department of Health gave a figure of £630 million. This was a projection of the expected income in the current financial year, 2006-07, under the new dental charge system, to be collected within all primary care dental practices that had previously worked either within the GDS or Personal Dental Service pilots Back

58   Source: British Dental Association. Not printed Back

59   In 1988 the percentage of treatment costs paid by patients was 75%. Now it is 80%, and will remain at this level under the new contract. Eversley, 2001, The history of NHS Charges and Q 247 Back

60   According to the Department, administration of dental charges is inextricably tied to the main process of paying dentists and the separate marginal cost of dealing with patients is minimal. The cost of salaries and overheads of the department that deals with exemption checking and patient refunds is £0.3 million per annum; the Department estimates that direct exemption checking costs less than £0.1 million per annum Back

61   Q 247 Back

62   Clinical Guideline 19. Dental recall: recall interval between routine dental examinations. NICE, October 2004 Back

63   Ev 4 Volume II Back

64   Ev 24 Volume II Back

65   Q 330 Back

66   Source: British Dental Association. Not printed Back

67   Q 328 Back

68   Q 595 Back

69   Q 247 Back

70   Ev 11 Volume II Back

71   Department of Health, Sight test volume and workforce survey, 2003-04 Back

72   In 2004-05, 11.7 million NHS sight tests were performed in England alone, Q 318 Back

73   General Ophthalmic Services: Consultation tables, NHS sight tests, vouchers, workforce, premises 2004/2005.  Back

74   Opticians groups estimated that the actual price of providing the test is approximately £37 Back

75   Optics at a Glance, FODO 2005. Survey based on a 25% sample of providers . The average figure is taken from a range of prices (£15 to £50). The average price also includes free sight tests for particular promotions or groups of patients. This inevitably reduces the average significantly Back

76   This comprises 0.5% on top of the cost of the sight test to compensate optometrists for requesting evidence of entitlement from patients, and recording and reporting the results to PCTs. In addition, a small supplementary fee is paid for similar checks on patients who claim NHS vouchers towards the cost of spectacles. PCTs oversee the General Ophthalmic Service and conduct sample checks on patients who claim entitlement to NHS services Back

77   The Health and Medicines Act of 1988 abolished free universal sight tests.  Back

78   Q 404 Back

79   The Child Health Sub-Group Report on Vision screening, of the National Screening Committee, recommended that all children should be screened between ages 4 and 5. Vision defects include amblyopia (3% of children), refractive error (hypermetropia, astigmatism, rarely myopia), and strabismus (3-6%). NSC May 2005 Back

80   Ev 148 Volume III Back

81   Q 308 Back

82   Office of Health Economics, Compendium of health statistics 1997. Cited in Eversley 2001 Back

83   Laidlaw and Bloom. The sight test fee: effect on ophthalmology referrals and rate of glaucoma detection. BMJ 1994;309:634-636. Referrals to the Bristol Eye Hospital were 13.7-19.0% lower than expected after the introduction of the sight test fee Back

84   Q 636 Back

85   Q 624 Back

86   Q 240 Back

87   Ev 138 Volume III Back

88   Q 356 Back

89   National Service Framework for Children, Young People and Maternity Services. Department of Health 2004. ; Research has shown that women are less likely to need a C-section when they receive one-to-one care from a single midwife Back

90   More exclusive private hospitals may charge over £10,000 Back

91   Q 417 Back

92   Qq 685-687 Back

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