Conclusions and recommendations
1.We are not confident that the Department for Health (the Department) is taking effective action to recover more of the costs of treating overseas visitors. Since 1982 the NHS has had a statutory obligation to identify and charge overseas visitors who are not eligible for free care. Yet in 2012–13 the NHS still charged only around 65% of what it could have charged to visitors from outside the the European Economic Area and Switzerland (EEA&S), and 16% of what it could have charged for visitors from the EEA&S. The amounts being charged have increased since then—to £289 million in 2015–16 compared with £89 million in 2012–13. In practice, the amount recovered will be less than the £289 million charged because trusts do not get back all of the amounts that they invoice to patients directly. Most of the gains so far have been from changes in the charging rules, in particular the introduction of the immigration health surcharge which generated £164 million in 2015–16. The Department for Health (the Department) has set a target to recover up to £500 million a year by 2017–18, but in October 2016 forecast that only £346 million would be charged. The Department referred to plans it had for policy and regulatory changes, work to identify and share good practice, and improvements to IT systems, but accepts that there is still a lot more to do to apply the existing regulations more effectively.
Recommendation: The Department of Health should publish, by June 2017 at the latest, an action plan setting out specific actions, milestones and performance measures for increasing the amount recovered from overseas visitors. The action plan should name senior individuals in the Department and NHS Improvement whom the Committee can hold to account.
2.Progress in increasing the amounts recovered, particularly for patients from other EEA&S countries, is hampered because the NHS is not effectively identifying chargeable patients. In 2012–13, the NHS charged an estimated 65% of the amounts it could have charged to overseas visitors from outside the EEA&S, and only 16% of what it could have charged for visitors from the EEA&S. The Department forecast in October 2016 that the NHS would charge £72 million in 2017–18 for patients from within the EEA&S, well below its original ambition to recover £200 million. The UK recovers far less from other EEA&S states than these countries claim from the UK: in 2014–15, the UK recovered only £50 million but paid out £675 million. While some of the difference can be explained by the cost of treating British state pensioners who live abroad, it is clear that hospitals are not identifying all the overseas patients they treat. A person’s chargeable status is primarily determined by whether they are ‘ordinarily resident’ in this country, and can change over time. NHS Improvement argues that it can therefore be extremely difficult, in busy clinical areas, to identify chargeable patients because there is no single document or piece of information, such as a passport or NHS number, that confirms whether or not a person should be charged for NHS treatment. The Department highlights that some trusts, for example in Peterborough, are now requiring patients to prove their identity by showing passports and utility bills. However, these documents do not demonstrate entitlement to free NHS care. The biggest challenge is that there is no single easy way to prove entitlement. In addition, we are conscious that some people who live in this country and are eligible for free healthcare may struggle to provide passports and utility bills and it is important that their access to care is not compromised. The Department should consider a system that would allow verification without compromising patient care.
Recommendation: The Department should do more to build on existing systems, such as the NHS number and electronic patient record, to flag to trusts when people are entitled to free care as well as when they are not. This could help tackle both the very low levels of cost recovery for EEA&S patients, and the problem that some people resident in this country may find it hard to show documents that indicate their entitlement. Government should work with other agencies public and private to make clearer in advance of people coming to the UK what health insurance should be taken out and individual liabilities.
3.The extent of unexplained variation between trusts, both in the amounts they charge and the debts they recover, suggests that some hospital trusts have scope to make substantial improvement. The Department and NHS Improvement recognise that some trusts are charging and recovering much more than others, but cannot explain why this is the case. Just 10 out of the 154 acute and specialist hospital trusts accounted for half of the charges to visitors from outside the EEA&S in 2015–16. Eight trusts did not charge any visitors from outside the EEA&S and 22 trusts did not report any cases under the EHIC scheme. Larger trusts and those in regions with more visitors are likely to charge more, but the variation between trusts is not fully explained by factors such as trust size and location. Debt collection rates also vary significantly, from 15% to 100%, even after excluding outliers (the top and bottom 10% of trusts). Increasing the amount recovered depends on action by hospital trusts, but only 11 of 50 trusts that responded to a consultation thought that their income from overseas patients would increase significantly in future.
Recommendation: NHS Improvement should benchmark trusts, identify which are doing well compared with similar trusts, share this information with senior trust executives and boards, and set out what it will do to promote best practice. An additional incentive would be to develop a system that more directly rewards those institutions which most efficiently collect monies owed.
4.While the statutory responsibility to identify and charge overseas patients lies with trusts, other parts of the health system also have an important role and are not yet doing enough to support cost recovery. The arrangements for recovering the cost of treating overseas visitors involve national oversight bodies, and also healthcare commissioners (NHS England and clinical commissioning groups) that bear the cost when trusts do not identify chargeable patients. These organisations need to support trusts to identify and charge overseas visitors. The Department recently introduced financial incentives, which appear to have helped increase the amounts charged to some extent. NHS Improvement told us it is planning to monitor charging and cost recovery, and intervene when it considers trusts are not fulfilling their statutory obligations. Commissioners have powers to audit trust recovery processes and are not liable to pay for treatment if a trust has not taken reasonable steps to identify chargeable patients and recover charges. It has been reported that more stringent tests of eligibility for maternity care put in place by St George’s Hospital in London were in response to the clinical commissioning group’s refusal to pay for overseas patients that it thought should have been charged directly. This suggests it may be possible to take effective action when there is the will to do so. However, there are no clear, consistently applied, sanctions when trusts do badly.
Recommendation: NHS Improvement should collect and share data on the performance of trusts in charging patients and recovering money, and intervene when performance is clearly falling short. At local level, clinical commissioning groups should scrutinise the performance of their local trusts, and use their powers to audit trusts if they are not confident that trusts’ charging processes are robust.
5.GPs could do more to help the NHS increase the amounts recovered for treating chargeable overseas patients. GPs are not contractually obliged to identify chargeable overseas visitors, but some share relevant information when referring patients for hospital treatment. There is also scope for GPs to report EEA&S patients through the EHIC scheme, which would allow the UK to recover costs from other EEA&S countries and thereby increase income for the health system. The Department is keen to support any GP surgeries that wish to pass on information, but there are no systematic arrangements in place for GPs to do so.
Recommendation: NHS England should clarify what it expects of GPs in relation to identifying chargeable overseas patients, and issue guidance by the end of June 2017. The guidance should set out the role of GPs in the charging system and how they might best fulfil this role.
30 January 2017