Select Committee on Health Third Report


54. Approximately 50% of the population are exempt from prescription charges, and around 87% of prescription items are dispensed free of charge.[93] A slightly lower percentage of the population is eligible for free sight tests, and approximately 25% of the population is eligible for financial help with dental costs. Exemptions are based on age, income, treatment setting and medical condition.

Categories of exemption


55. Children and young people are largely exempt from charges. All under 16s are exempt from the prescription charge and are eligible for free sight tests, and under 18s are exempt from dental charges. Those under 19 in full-time education are exempt from the prescription charge and are eligible for free dental care and sight tests. The over 60s are exempt from prescription charges and are eligible for free sight tests, but must pay dental fees.


56. People between 16 and 60 are entitled to exemptions according to their circumstances. Patients in receipt of Income Support, Income-based Jobseeker's Allowance or Pension Credit (guarantee credit) are exempt from health charges, but those receiving Incapacity Benefit or Disability Living Allowance are not automatically exempt. Individuals who hold a valid exemption certificate for a War Disablement Pension do not have to pay prescription charges (but only in respect of medication for the accepted disablement).

57. Those most affected by charges are working adults on incomes just above the level of Income Support. Professors Light and Lexchin argued:

Dr Maureen Baker from the Royal College of GPs said that patients just above this threshold experience "quite a hit" if they are not expecting to be charged.[95] The mutual organisation Simplyhealth stressed:

    There are a number of people in society who do presently find themselves hugely impacted by charges because they are not on certain benefits but they are not top earners… £189 for dentistry, for instance, can make a tremendous impact on them come the end of the month.[96]

There are schemes in place to help some people in this position, in particular the NHS Low Income Scheme (LIS) and the Prescription Pre-payment Certificate (PPC).


The NHS Low Income Scheme

58. The NHS Low Income Scheme (LIS) provides financial assistance for those who are not eligible for exemption from charges through other means. It covers prescriptions, dental and optical services, travel expenses, wigs and fabric supports. Under the LIS some patients receive services completely free of charge, while partial support is available for those with slightly higher incomes. The capital threshold for the LIS is £21,000 for those permanently in a care home and £16,000 for all other patients.[97]

59. To apply to the scheme, patients must complete a lengthy HC1 form which is sent to the Prescription Pricing Authority (PPA).[98] Patients are then sent an HC2 certificate, an HC3 certificate or an explanation of why they are not eligible for help through the scheme.

60. The HC2 certificate entitles the patient to help with the full costs of their medicines, NHS dental treatment, maximum value vouchers towards the cost of glasses and reasonable costs incurred when travelling to hospital while under the care of an NHS hospital consultant. The HC3 certificate entitles the person named to limited help with the above. The certificate shows the maximum amount patients are expected to pay for prescriptions, NHS dental treatment, towards the cost of glasses or towards transport to hospital.[99] The certificates usually lasts for 12 months and must be renewed each year.

61. Witnesses thought the LIS had many failings. The application process, in particular, was highlighted as lengthy and complicated. Ministers argued that the form was brief, comprehensible and easy to complete, but the BDA told us:

    That is a big, complex document, as you rightly say. We would like that simplified because it makes it very difficult for patients to deal with and some, I am sure, are deterred by the fact that it is a big jargony form.[100]

The nature of the form means that many patients do not apply for the scheme, and aid agencies spend considerable amounts of time helping patients to complete it.[101] One Member of the Committee put the situation as follows:

    I am absolutely horrified. It is the most impossible form anybody could ever have to fill in even if they were 50 with an IQ of 150.[102]

62. In 2001/02 the PPA received 879,000 claims for the LIS. Of these, 496,000 patients received HC2 certificates (allowing full help with costs) and 305,000 received HC3 certificates (allowing limited help).[103] Numbers of claims have been reportedly falling steadily, and between March 2005 and March 2006, 542,549 claims were received.[104] There is no assessment of take-up; the Department of Health does not collect information about those who might be entitled to help through the scheme but choose not to claim.

Prescription Prepayment Certificate

63. Those who are not entitled to a free prescription and do not qualify for the LIS can take advantage of the Prescription Prepayment Certificate (PPC), which was introduced as a means of reducing costs for individuals who require several prescribed items on an ongoing basis. A PPC requires an up-front payment of £34.65 for four months or £95.30 for 12 months, after which no further payment is required for an unlimited number of prescribed items.[105] According to the Department of Health, 4.7% of prescriptions are paid for using a PPC.

64. There are two significant problems with the PPC. Firstly, £34.65 can be a relatively large sum for poorer patients to find. Secondly, people do not always know that they will require a long course of treatment and so may have already spent money on prescriptions before they consider whether to purchase a PPC.

Information to patients

65. While they said that there was a good deal of information about the benefits available to assist patients to pay charges, Ministers admitted that patients often do not claim the benefits to which they are entitled.[106] Many do not know about the assistance that is open to them. The Prescription Pricing Authority encourages, but does not oblige, GP surgeries, chemists, opticians and dentists to hold copies of relevant information leaflets.[107] Citizens Advice, which now operates from some GP surgeries and clinics, highlighted the lack of information to patients about exemptions. This point was also made by Macmillan, the Socialist Health Association (SHA) and Age Concern.[108] Professional groups agreed. The BDA and the opticians groups said that most of their members accepted that it was their role to give information to patients regarding exemptions. Despite this, the BDA stated that patients were still often not sure whether they were eligible for free dental care:

    There needs to be a more coordinated approach, firstly, between Government departments and, secondly, with patient and professional organisations…on the most appropriate way for making people aware of their eligibility for exemption from charges.[109]

Mr Darracott of the RPSGB demonstrated a card, produced by pharmacists, which is found at the dispensing counter, but added:

    I think, in short, more publicity would be helpful because at the moment the profession itself is producing this card to tell patients about what the charges are.[110]


66. The setting in which patients are treated dictates whether or not they are charged: hospital inpatients do not pay for prescriptions or dental charges, but outpatients are charged. Some patients admitted for day surgery must pay the prescription charge for the painkillers they take home. The British Association of Day Surgery argued that this would soon be standard practice throughout the NHS.[111]

67. Changing medical practice and technology have overtaken the charging system. Far fewer patients need to stay in hospital now compared to 40 years ago. This means that more people have to pay for prescriptions because they are treated as outpatients rather than inpatients. A breast cancer sufferer said:

    Dealing with a terminal disease is difficult enough without worrying about the cost of life-saving prescriptions.[112]

68. Outpatient treatment means that those who might need persuasion to take medication do not receive it. Charges add to this problem. Mental health patients must pay prescription charges, even though their liberty may depend on compliance with the drug regime.[113] The requirement to prescribe some types of treatment on a weekly basis, to guard against overdose, increases patient costs dramatically. Moira Fraser from Mind pointed out that the mentally unwell are a vulnerable group who need all encouragement possible to take their medicines. Dr Geoff Searle, a consultant psychiatrist in charge of a Crisis Response Team, echoed this view:

    They never have enough cash in hand to buy pre-payment certificates. For those on three or four medications long term the prescription charges are a considerable burden and expense, and for those with doubts about the need for medication the charges are a great excuse not to comply with needed treatment.[114]


69. Patients are also exempted because of their specific medical conditions (see box below). The treatment and vaccination of sexually transmissible infections is free, as are contraceptives for women. Pregnant women and those who have given birth in the last 12 months are exempt from the prescription charge and dental costs. Those with diabetes, glaucoma, or aged over 40 with a first degree relative with the disease, are eligible for free sight tests.

70. The criteria that distinguish between patients exempt from health charges and those who pay are inconsistent and anomalous. In particular, witnesses thought it absurd that the list had not been updated since 1968. Representatives from Macmillan, the Cystic Fibrosis Trust, Parkinson's Disease Society and others were frustrated by the exclusion of some long-term conditions from the list of exemptions.[115] Dr Meldrum of the BMA pointed out the illogicality of the system:

    If you happen to have an under-active thyroid at any time in your life and you are required to take thyroxine you are prescription exempt for everything. Somebody who happened to have an under-active thyroid at 20 and who turns out to be hypertensive in their 30s or 40s gets free medication. Somebody else who just becomes hypertensive and did not have the fortune to have an under-active thyroid does not, they pay.[116]

This criticism is not new. In 1994, the Health Committee stated:

    The current system of exemption on medical grounds contains elements of illogicality. The Government has stated that exemption is granted for patients with "specified readily identifiable chronic illnesses calling for lifelong medication". What is not clear is why some conditions which are judged to satisfy this criterion are exempt, whereas others—for instance, pernicious anaemia, cystic fibrosis, chronic asthma, hypertension and a variety of dermatological conditions including eczema—are not. One reason may be that the medical understanding of some of these conditions has developed since the list of current categories was drawn up.[117]

71. Diseases such as HIV/AIDS did not exist in 1968 when the original list was compiled. The ways in which many diseases are treated has also changed; more and better medicines are available and the possibilities for intervention have increased. In 1968, most babies born with cystic fibrosis, for example, did not live beyond childhood, and so the issue of prescription charges was not relevant: patients were automatically eligible due to their young age. Thanks to improved treatments, many patients now reach adulthood, the average life expectancy exceeding 30. Such patients take a myriad of different medicines a day. A cystic fibrosis patient, Ms Lynsey Beswick, told the Committee:

    There are about 85 tablets, plus nebulisers three times a day. 85 tablets are what I have to take daily. I am surprised I do not rattle really.[118]

Exemptions policy: the Government's justification

72. It is not easy to determine the underlying principles of the Government's policy on exemptions. It stated that its policy is that financial assistance is based on the principle that:

73. But it is evident that this principle does not apply. Many wealthy older adults in England could afford to pay for their prescriptions, but do not. Wealthy people with certain medical conditions are exempt as are the children of wealthy parents. We questioned the Minister about this:

    Dr Taylor: …you have said that one of the principles is that those who can afford should pay. Are you not now contradicting that?

    Jane Kennedy: No, because we have exempted those who are in retirement and are not working.

    Dr Taylor: But you have also exempted a lot who could afford to pay?

    Jane Kennedy: That is true.

    Dr Taylor: Which goes against your principle?

    Jane Kennedy: If you like, we have refined the principle.[120]

74. Ministers were clearly concerned about taking benefits away from currently eligible individuals[121] and were reluctant to consider a move towards requiring rich pensioners and others in receipt of free prescriptions to pay for their medicines,[122] regardless of the equity of the system:

    Wherever we have made those changes, the intention has been to preserve an existing entitlement; it has never been to take one away.[123]

The Government claims that its exemptions policy is based on income: those who can afford to pay, those who cannot do not. However, this is not the case: many wealthy people are exempt, but many poor working people are not. The exempt medical conditions have not been revised for almost 30 years, creating many anomalies. It is evident that Government policy is to maintain the status quo and not to upset any existing beneficiaries.

93   Ev 1 Volume II Back

94   Ev 94 Volume II Back

95   Q 301 Back

96   Q 505 Back

97   See  Back

98   From 1 April 2006 the PPA is a division of the NHS Business Services Authority Back

99   Vouchers are available for eligible patients to pay for glasses. There are eight bands of voucher value, ranging from £32.90 to £181.40. Otherwise, financial assistance for dental charges and the cost of glasses is absolute and no tapered help is available. The voucher is redeemed by the optician from the local PCT. The allowances for complex lenses include a supplement of £12.40 for single vision and £31.30 for bifocal lenses. In March 2006, regulations were laid before Parliament to increase the value of these vouchers by 2.5%. HC Deb, 10 Mar 2006, Col 83WS Back

100   Q 390 Back

101   Ev 34 Volume II, Qq 235, 242  Back

102   Q 708 Back

103   See SK Sihota, Creeping Charges, National Consumer Council, July 2003 Back

104   Source: Department of Health. Not printed. The Department could not explain the fall in the number of claims submitted Back

105   Ev 1 Volume II On average, 46 items were dispensed to each PPC-holder in 2004-05. According to the Department, 4.7% of prescriptions dispensed were charged at PPC rates Back

106   Q 622 Back

107   The PPA spends £416,000 every year on material to promote the help that is available and also runs a help line Back

108   Ev 55, Ev 80, Ev 13 Volume II Back

109   Ev 25 Volume II Back

110   Q 201 Back

111   Short stay hospital patients face charge for painkillers, The Guardian, 13 December 2005 Back

112   Pat Montgomery, Leicestershire, Ev 21 Volume II [evidence from Breast Cancer Care] Back

113   Ev 60 Volume II. Section 25a of the 1983 Mental Health Act requires patients previously held under section in hospital to take their medication in the community or risk being taken back into hospital Back

114   Ev 154 Volume III Back

115   Ev 50, Ev 38, Ev 64 all Volume II Back

116   Q 161 Back

117   Health Committee, Second Report of Session 1993-1994, Priority Setting in the NHS: The NHS Drugs Budget, HC 80-I Back

118   Q 274 Back

119   Ev 1 Volume II Back

120   Qq 609-611 Back

121   Q 608 Back

122   Qq 607-608 Back

123   Q 586 Back

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