Select Committee on Health Written Evidence

Memorandum submitted by Standard Life Healthcare (CP 10)


  1.1.1  Standard Life Healthcare is one of the UK's leading private medical insurers with around 440,000 lives covered. We provide a range of healthcare solutions focusing not only on ensuring prompt treatment when our customers are ill but also a range of tools to promote good health.

  1.1.2  We have a track record of collaborative working to promote good health having been prominent in the debate on improving health at work. We also want to contribute to our debate by offering some conclusions drawn from our experience of a business centred around private payments for healthcare.

1.2  Whether charges for treatments, including prescriptions, dentistry and optical services; and hospital services (such as telephone and TV use and car parking) are equitable and appropriate.

  1.2.1  It is Standard Life Healthcare's view that it is fundamentally appropriate to levy charges for aspects of healthcare so long as they are transparent and fair. We have heard recently that the NHS may be facing a deficit of around £620 million for 2005 and healthcare costs are increasing rapidly leading to cost pressures in both the public and private sector. In this environment it is appropriate and necessary to continue to levy charges. This is not to say that the system cannot be improved but it should not be scrapped altogether.

  1.2.2  We argue that the current system of charges is inappropriate in that it is incoherent and lacking a proper framework to decide what should be provided free at the point of delivery and what should be subject to charging. This is unhelpful for patients who are uncertain about where they will have to pay charges as well as helping to prevent a proper public debate about the value of healthcare.

  1.2.3  We should ask whether patients would consider charges to be more appropriate if there was greater public understanding of the costs of healthcare and the funding pressures on the NHS and other providers.

1.3  Whether the system of charges is sufficiently transparent

  1.3.1  The system of charges is not at all transparent. There is no logic behind the current regime of charging. Why do we pay a prescription charge but make no contribution to the cost of drugs supplied as part of in-patient treatment? Why do we pay for car-parking but not for the hotel cost of a hospital bed? Why are optical services subject to charging but GP appointments are not? This is not to draw conclusions about any of these specific examples but to make the point that the current system of charges is confusing and incoherent. Funding pressures on health services mean that charges are inevitable but it does not serve patients to maintain the current, unclear system. We need a proper public debate about the need for co-payments in health services.

1.4  Whether charges should be abolished

  1.4.1  In a perfect world we would all prefer that healthcare was provided entirely free at the point of need for patients. However soon after the foundation of the NHS it became clear that some charges were necessary to cope with the extraordinary demand for "free" health services. This is a pattern that has not altered in the decades since. Ideally charges should be abolished but in actuality this is not a realistic option.

1.5  Recommendations

  1.5.1  The government should open a public consultation on charges; where they should be levied and at what level. One aim of this should be to explain to patients and the public why, with the high costs of modern healthcare, charges are necessary.

  1.5.2  There should be greater recognition from government that people are willing to pay for healthcare. We see this in the booming market for health related products, particularly those focusing on diet and fitness as well as research that demonstrates that 58% of people would pay up to £1000 for medical treatment. Only 24% would not be prepared to pay for treatment. (Standard Life Healthcare Attitudes to Healthcare Survey 2004).

  1.5.3  The government should encourage those who can afford to contribute more towards the cost of their healthcare by considering ideas such as Health Savings Accounts which could work along the same principles as an ISA—tax free savings hypothecated for spending on healthcare.

David Furness

Standard Life Healthcare

December 2005

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