Consultation on Proposal to abolish NHS Prescription Charges

6. Options for Legislation: Reform or abolition

“I give my absolute pledge that if we are returned to power we will sweep away all prescription charges” – Rhodri Morgan, First Minister, Welsh Assembly

6.1 The UK’s current prescription charging system is neither logical nor fair. It imposes financial burdens on people when they are at their most vulnerable and its exemptions fail to assist huge numbers of people on below average incomes and/or with chronic illnesses.

6.2 So can it be reformed or should it be abolished? One route to a fairer prescription charging system would be to extend the range of chronic illnesses which are exempt from charging. What is the approach in other areas of the United Kingdom and what are the pros and cons of extending exemptions.

6.3 England: The Westminster Government, which has control of prescription charging policy for England has stated in Parliamentary answers that it has no plans to extend the list of conditions that are exempt from charging.

6.4 Wales: In 2001 the ruling Labour/Liberal coalition in the Welsh Assembly responded to public concerns about prescription charging by introducing a new age exemption from charging for all 16-25 year olds. At the time there were fears expressed by opponents of this reform that young English patients would flood across the border for free medicines. However research has shown that this did not occur. Because of the extension of exemption on age grounds the proportion of Welsh people receiving prescriptions who were exempt rose from 89% to 93%.

6.5 At the beginning of this year twenty Labour Welsh Assembly members voted with Plaid Cymru and the Liberal Democrats to extend exemptions to those suffering from chronic medical conditions. This would have cost about £19 million a year.

6.6 However before that legislation could be introduced Labour pledged in their manifesto for the Welsh Assembly elections that they would abolish prescription charges entirely. The estimated cost of total abolition was £30 million (i.e. only £11 million more than extending exemptions). Total abolition seems to have won increasing favour because it seemed unfair and overly bureaucratic to charge an ever declining and smaller proportion of the population

6.7 The question that occurs, after the reforms and forthcoming abolition of charges in Wales, is, if Wales, with a smaller population and revenue share, can afford this reform, why can’t Scotland?

6.8 However if Scotland were to go down the route of extending exemptions the Scottish Parliament or the Scottish Executive would have to consider which illnesses should be added to the list of those that are already exempt.

6.9 There are a wide range of illnesses which are chronic in nature and for which there is a compelling case for exemption from charging. Whatever the outcome of any future review it is certain that some chronic illnesses would not achieve exempt status. So some chronically ill people would benefit from an extension of exemptions but thousands of sufferers of other chronic conditions would be disappointed and continue to face charges. Thus an extension of exemptions, though no doubt welcome, would continue to perpetuate the unfairness of the current system and penalise people financially simply because they are ill.

6.10 The Scottish Executive are currently undertaking a review of the charging system which will examine whether to add to the list of exempt conditions. However there can be no certainty that the review will assist any people suffering from chronic illnesses. The last review of exemptions was carried out by the UK Government in 1998. It did not add a single new medical condition to the list of those exempted in 1968.

6.11 A second issue is that the prescription charging system would become less financially viable if exemptions were extended. Scottish arthritis sufferers paid £2.8 million in prescription charges in 2000 - 2001. That represented over 6% of all the revenue raised by charging. Even if only three or four major chronic conditions were added to the exempt list it’s easy to see that the amount raised by charging would decline substantially.

6.12 In 2001-2002 the amount raised by charging was £46.3 million out of a total NHS prescription drugs bill for the year of £733 million. As the amount raised by charging represents just 6% of the Scottish NHS prescription drugs bill then if extending exemptions led it to decline to just 3% of that bill it might be wondered whether it was worth collecting, given how proportionately little revenue it would actually generate.

6.13 Thus the greater the number of people that exemptions were extended to the less revenue that prescription charges would generate. Therefore any question over how abolition of charges is to be paid for could similarly be posed over widening the number of conditions which are exempt.

6.14 On balance therefore abolition of prescription charging seems a surer route to genuine fairness than exemptions. This is because -

The real cost of prescription charges has soared making them an unfair burden on below average income households.
If abolished all those on below average incomes would be exempt rather than the current situation where some low income households pay and some do not.
None of the tens of thousands of people, who are currently deterred from having their prescriptions filled out, would have their illness prolonged or health endangered because of the cost of prescriptions.
If exemptions were merely extended some sufferers from chronic conditions would continue to have to pay prescription charges whereas if charges were abolished no sufferers from any chronic, life long medical condition would be required to pay for medicines.
If the current list of exempt conditions was simply extended those people who acquired new medical conditions in the future might have to wait decades for their plight to be recognised and their condition added to the list.

6.15 Therefore the proposal which has been set before Parliament, rather than seeking to reform the current system of charging, instead sets out to completely abolish charges for prescription medicines.