1.Patients are finding it extremely difficult to understand whether or not they are entitled to free prescriptions or dental treatment. Rules about entitlement to free prescriptions and dental treatment are unnecessarily convoluted, as illustrated by the Department’s 24-page handbook to explain the single page prescription form. Exemptions from prescription and dental charges include age, maternity, receipt of certain means-tested benefits, low income, and long-term medical conditions in some cases, although we are told that this list of long-term conditions has not been updated for 50 years save the addition of cancer in 2009. A person’s eligibility for exemption also varies between prescriptions and dental treatment. An already complex system has been further complicated by the roll-out of Universal Credit, which means entitlement can vary from month to month. There is currently no way of indicating receipt of Universal Credit on prescription forms, resulting in more confusion, and the Department for Work and Pensions (DWP) does not confirm eligibility when they write to claimants about their confirmed benefit entitlements. The Department of Health and Social Care acknowledges that it is a very complicated system and that some of the current processes can cause people distress. Only after ramping up its exemption checks and PCN regime did NHSBSA realise that patients were confused by the rules, implying that it had very little awareness or response before.
Recommendation: The Department of Health and Social Care should set out how it will make exemptions more readily intelligible for all claimants, based on evidence of how users complete applications.
The Department should work more closely with the Department for Work & Pensions to improve the information provided to benefit claimants about whether they are entitled to free prescriptions. Specifically, it should investigate the feasibility of DWP indicating whether claimants are entitled to free prescriptions or dental treatment in the letters it sends to claimants about eligibility for benefits.
2.NHSBSA’s presumption of guilt means penalty charge notices are issued too readily, particularly where vulnerable people are concerned. Since 2014, around 1.7 million PCNs (30% of all PCNs issued) have been subsequently withdrawn because a valid exemption was confirmed to be in place following a challenge. Where NHSBSA cannot find supporting evidence for an exemption, it automatically issues a PCN to the patient, rather than giving them an opportunity to correct a mistake, provide evidence or pay the prescription or treatment charge. The Department plans to introduce an additional stage in the PCN process where an individual will be alerted to a possibly unjustified exemption claim before a PCN is issued, and therefore have the opportunity to challenge it before being charged up to a £100 penalty. We welcome this extra step but question why NHS England did not introduce it at the outset, given its success in Scotland and Northern Ireland. NHSBSA acknowledges that some of its processes can cause distress, and before sending out PCNs it filters out addresses which are known to be residential care homes. This is likely to cover only a small proportion of vulnerable people whom it should not be pursuing with fines.
Recommendation: In six months’ time, the Department should write to the Committee to establish when it plans to introduce the additional checking stage in the PCN process and the timeline for doing so.
In the same letter, the Department should set out how this will reduce the proportion of PCNs that are later overturned and identify claimants who may be particularly vulnerable.
3.NHSBSA has implemented the PCN policy without evaluating the impact of PCNs on claimants seeking treatment. NHSBSA continues to stress that 97% of non-age-related exemption claims are correct, using this to justify the PCN process. However, it has not attempted to identify those who are entitled to an exemption but pay for treatment. The Department also recognises that some people may not seek treatment because they are worried about getting a PCN. NHSBSA’s advertising campaigns focus on the consequences of incorrectly claiming an exemption rather than making those who are entitled to an exemption aware that they do not need to pay. We believe that this kind of threatening approach is unhelpful and we are concerned that it could have a negative impact on people who are legitimately entitled to exemption. The British Dental Association tells us that last year it saw a 23% fall in the number of people on low incomes seeking treatment and is concerned that the threat of fines may have discouraged people from going to the dentist. Failure to seek treatment when needed is only likely to push up longer-term costs to the NHS.
Recommendation: The Department should actively seek information from the NHS and from other government departments about the consequences of prescription charges and the PCN process. It should provide to the Committee a breakdown of: people not seeking the treatment they need for fear of incurring fines, patients not claiming the exemption to which they are entitled and admissions to hospital as a result.
4.We are highly sceptical that real-time exemption checks will be rolled out soon. The Department admits that the system is complex and needs improving, and plans to introduce a real-time exemption check in pharmacies, which would enable pharmacists and patients to quickly check whether they are entitled. While real-time checking might resolve many of the problems people currently face, we are concerned that the Department does not have a start date and, therefore, that such a system is still a long way off. The exemption checks it is now trialling are limited to just four pharmacies who share the same IT system and do not include benefit-related exemptions nor eligibility for free dental treatment. Extending the trials to the ten other IT systems run by pharmacists and incorporating a real-time link to data from the Department for Work & Pensions are likely to present major hurdles. Ultimately, we have no confidence that this system will be rolled out later this year, as the Department told us.
Recommendation: NHS England and NHSBSA should pursue real-time checking as a priority, and should write to us with the results of the pilots, confirming a timetable for implementation and the cost of the real-time checking project.
5.Where there is clear evidence that people are persistently committing fraud by making false claims, NHSBSA has failed to take effective action. The Department claims that the best outcome from the PCN system is the prevention of fraud, but NHSBSA is doing very little to pursue those who repeatedly claim free treatment without an exemption. Nearly 115,000 people have received five or more PCNs for prescriptions, over 1,600 have received 20 or more—yet only five cases have been referred to the Crown Prosecution Service. Only one has been heard in court. The Department has so far failed to approve a prescriptions debt collection process for NHSBSA, leaving it unable to pursue such outstanding debts owed. Yet the system is inconsistent: at the same time, NHSBSA is over-zealous in pursuing people who have made mistakes once. Many people are fined immediately for mistakes that could easily have been corrected, had they been given the opportunity.
Recommendation: By December 2019, NHSBSA should evaluate the cost-effectiveness of spending more time and resources pursuing repeat offenders and write to us with the result of this work. In doing so, it should tell us the number of such cases that are being actively pursued.
6.The PCN process, as it stands, is not working efficiently or effectively. We therefore call on the Department to substantially overhaul the system, so that those who are rightfully entitled to free prescriptions and dental treatment get the exemption they deserve. Since ramping up exemption checking in 2014, NHSBSA has issued 5.6 million PCNs, but has only collected 20% of their value. The Department argues that its approach is justifiable because it spends 31 pence per £1 collected managing the process. However, it has not calculated costs to the wider health system, where patients—for fear of being fined—do not seek the treatment they need and end up in hospital. Nor does that calculation take account of people paying for prescriptions when they are entitled to an exemption, or paying fines which they could have challenged or which could have been avoided by clearer guidance being available to them in the first place. Last year the PCN process generated a net yield of £25 million for the NHS, a pitiful sum compared to the annual cost of prescriptions which is around £9 billion. We do not dispute that it is right to try and deter fraud and recover costs mistakenly paid by the NHS, but the current system is not fit for purpose.
Recommendation: Having acknowledged that the PCN process needs improving, NHS England and NHSBSA should write to us in a year’s time to explain how they have made the process more humane and cost-effective.
Published: 20 September 2019