Top-up fees - Health Committee Contents


3  Addressing the problem

  1. In 2008 and early 2009, faced by the problems identified in the previous chapter as well as the campaign by patient groups, the media and some others, the Department and NICE made a number of decisions which were designed to make it easier for NHS patients to receive drugs not currently provided by the NHS.

Box 2: Key decisions made by the Department aimed at improving access to NHS funded drugs

18 June 2008—The Secretary of State asked Professor Mike Richards, National Clinical Director for Cancer ("Cancer Tsar"), to lead a review of the current arrangements regarding the circumstances in which patients are able to purchase additional drugs that are not funded by the NHS.

4 November 2008—"Improving access to medicines for NHS patients A report for the Secretary of State for Health by Professor Mike Richards CBE" is published. The report makes a total of 14 recommendations, all of which are accepted by the Department on the same day.

4 November 2008—The Department issues for consultation draft guidance to all NHS Chief Executives about the principles which should be followed when separating NHS and private care. At the same time, the NHS Chief Executive directed NHS institutions not to withdraw NHS funding for patients who had chosen to purchase additional treatment privately.

17 December 2008—Following a short consultation NICE issues its Appraisal Committees with supplementary guidance aimed at improving access to expensive medicines licensed for end-of-life patients, affecting small numbers of patients.

27 January 2009—The consultation ends on the draft guidance for separating NHS and private care.

23 March 2009—Final guidance for separating NHS and private care issued to NHS Chief Executives

The Richards Review

  1. The Department's first decision in June 2008 was to appoint Professor Mike Richards, National Clinical Director for Cancer (the "Cancer Tsar") to lead a review of the Department's policy on the provision of drugs. Professor Richards was asked to examine "if, when and in what circumstances patients should be able to purchase additional drugs that are not funded by the NHS".[40] The Review, which covered all drugs, not only cancer drugs, included an assessment of the experiences of comparable countries. It also addressed two areas of controversy identified in the previous chapter: whether PCTs (and individual clinicians) were justified under current legislation to withdraw NHS care for patients who had sought additional private treatment for life threatening illnesses; and the extent to which there were variations in the way in which PCTs were implementing existing guidance in this area.

Box 3: The terms of reference for the Richards Review

"To examine current policy relating to patients who choose to pay privately for drugs that are not funded on the NHS and who, as a result, are required to pay for the care that they would otherwise have received free on the NHS.

To make recommendations on whether and how policy or guidance could be clarified or improved.

In making recommendations, to take into account:

the importance of enabling patients to have choice and personal control over their healthcare; and the need to uphold the founding principle of the NHS that treatment is based on clinical need not ability to pay, and to ensure that NHS services are fair to both patients and taxpayers.

The Review will take account of:

the Government's wider strategy for improving the quality and effectiveness of NHS services; and developing policy and practice arising from the NHS Next Stage Review and Constitution."

Source: Department of Health, "Improving access to medicines for NHS patients"

36. Over the summer of 2008 Professor Richards sought responses to his terms of reference from a range of individuals including patients, clinicians, and representatives of patient groups and pharmaceutical companies. On 4 November 2008, only four months after the Secretary of State had asked him to conduct the Review, and three weeks after the period of consultation had ended, Professor Richards published his findings in Improving access to medicines for NHS patients.[41] Despite the limited time available to him, Professor Richards argued that he had reached his conclusions having conducted a "rigorous consultation", involving "over 2,000 patients, members of the public, NHS staff and managers, and other stakeholders" as well as the involvement of a number of charities such as Macmillan Cancer Support, and the Long Term Conditions Alliance."[42]

37. A total of fourteen recommendations were made to the Secretary of State which if implemented, Professor Richards argued, would:

  • minimise the number of patients who may want to purchase additional drugs by making more expensive drugs available from the NHS; and
  • establish clear guidance for those patients who still wished to purchase additional drugs.

RICHARDS' RECOMMENDATIONS TO MINIMISE THE NEED TO PURCHASE DRUGS

38. Professor Richards stated that the central aim of his Review was to make drugs more readily available, more quickly, to NHS patients.[43] He also noted that the Department had previously announced measures which he argued would help achieve this aim, including the proposal to improve and quicken the NICE decision-making process for appraising new drugs and the establishment in the draft NHS Constitution of a patient's right to NICE approved treatments.[44]

39. However, Professor Richards acknowledged that these measures alone would not make more NHS drugs available in all circumstances or end the debate about access to drugs. To that end he recommended:

  • closer collaboration between the Department and NICE to devise "affordable measures to make end-of-life drugs that do not meet the cost-effectiveness criteria";
  • negotiations with the pharmaceutical industry to promote more flexible approaches to the pricing and availability of new drugs; and
  • more collaboration, carried out transparently, between PCTs when making decisions about whether to fund those drugs which had not yet been appraised by NICE.

We look closely at the potential impact of these recommendations in the following chapter.

RICHARDS' RECOMMENDATIONS TO ENSURE THE SEPARATION OF NHS AND PRIVATE CARE

40. Despite the implementation of the measures outlined above, there will remain instances where patients wish to purchase drugs not provided by the NHS. Although Professor Richards maintained that when this circumstance arose the existing rules governing the separation of NHS and private care had been clear, he also recognised that some clinicians and PCTs had interpreted them inconsistently. He also acknowledged that there was some confusion about how to separate private and NHS care in practice and looked at how this could be done.

41. Professor Richards considered five options for enabling patients to purchase additional drugs. He described the range of options as follows:

One extreme was that you say to patients, "Sorry, if you have any private care you cannot come to the NHS" and we got a very, very clear message from the public, from patients, from a whole lot of people that that was utterly unacceptable. At the other end of the spectrum we could have gone down a route—we looked at this and rejected it—of saying that effectively the NHS can have a set of basic care that you get free and then on a sort of top-up basis you can pay for extra things on top of that and then there would be a lengthy menu of things you could pay for on the NHS. We rejected that as well because that is not the NHS that I certainly want to see.[45]

The diagram below illustrates the options considered by Professor Richards.

Source: Department of Health, "Improving access to medicines for NHS patients"

42. Professor Richards concluded that separation of NHS and private care (option 3) was the best option because it enabled people to have that private care while at the same time preserving the fundamental principles of the NHS that the NHS should not subsidise private treatment.[46] Of the options favoured by some witnesses vouchers (option 2) and co-payments (option 5) were rejected because:

We believed the voucher scheme was the worst of all options in fact largely because it would take money out of the NHS and also if people then went to a private hospital their NHS element would have transferred them into the private sector but they would be paying more for that same element in the private sector than they would in the NHS. So it would be bad for the individual and it would be bad for the NHS. We looked at that and we set out all the different reasons in the report why we rejected that. In terms of the option what might be called the full top-up scenario which is saying that the NHS has a schedule of things that you can get on the NHS but here are all the other things which you might want to pay for, I can tell you there was very little enthusiasm for that amongst the great number of people that I talked to.[47]

43. Having concluded that separation of NHS and private treatment was the best option for the NHS, Professor Richards set out the principles by which it should be implemented. These were:

  • the NHS should make clear that no patient should lose their entitlement to NHS care they would have otherwise received, simply because they opt to purchase additional treatment for their condition.[48]
  • the Government should make clear that when additional private drugs are purchased, the following criteria has been followed:

- clinicians have first exhausted all reasonable avenues for securing NHS funding; and

- patients should be able to receive additional private drugs as long as these drugs are delivered separately from the NHS elements of their care.[49]

44. Professor Richards argued that these principles (which following our evidence sessions were reaffirmed in the final guidance issues on 23 March 2009) would end any confusion about whether patients receiving NHS treatment were entitled to purchase additional private drugs, whilst ensuring that when drugs were purchased, the NHS would not subsidise private healthcare. Moreover, he argued that the Review had brought about greater clarity to how care should be separated, while at the same time avoiding the creation of a "two-tier" NHS that other options would have produced.[50]

The response of the Department and NICE to the Richards Report

45. On 4 November 2008, the same day that Professor Richards' report was published, the Secretary of State accepted all fourteen of Professor Richards' recommendations. In the weeks following the report's publication, the Department and NICE made a number of key decisions which were aimed at implementing the recommendations. These were:

We now look at these decisions in turn.

GUIDANCE ON SEPARATING NHS AND PRIVATE CARE

  1. Immediately following Richards' Report the Department announced that those patients who wished to buy additional private care would not have their NHS care withdrawn as long as the private care could be delivered separately.[52] At the same time, the Department sought to address concerns that separation might not be possible to implement in all cases by issuing revised guidance about how the NHS should manage these situations.

Box 4: Revised guidance on handling separation of NHS and private treatment

"It should always be clear whether an individual procedure or treatment is privately funded or NHS funded.

Private and NHS care should be kept as clearly separate as possible.

Private care should be carried out at a different time and place. A different place would include the facilities of a private healthcare provider, or part of an NHS organisation which has been designated for private care, including amenity beds.

This guidance applies to additional private healthcare that patients receive over and above their NHS care. It does not permit a 'pick and mix' approach where patients can pay to upgrade any individual elements of their NHS care."[53]

Source: Department of Health

47. NHS Chief Executives were asked to comment on the guidance by 27 January 2009 and respond to the following questions:

  • Is the principle of separateness clear?
  • Are sufficient safeguards in place?
  • Should there be more assurance mechanisms in place to ensure the guidance is followed and does not lead to any unintended consequences?

48. Although the guidance was issued to the Chief Executives for consultation, Mr David Nicholson, the NHS Chief Executive, asked them to apply the guidance immediately "owing to the need to end uncertainty for patients and the NHS as soon as possible and with immediate effect".[54] The Department proposed that in practice, the delivery of additional drugs in a private setting could mean their being administered in:

  • a dedicated private facility within an NHS Trust;
  • a specially designated area for those Trusts without private facilities;
  • a private hospital; or
  • at home by a private healthcare provider.

49. On 23 March 2009 the Department issued its final guidance on separating care. Although the final guidance contained a number of scenarios to exemplify situations where separation could be achieved, it was little changed from the draft version.[55]

REVIEW OF GUIDANCE FOR NICE APPRAISAL COMMITTEES

50. Central to the Department's plans to minimise the number of patients who purchase additional drugs was the supplementary guidance issued by NICE to its Appraisal Committees which was aimed at improving access to expensive medicines licensed for terminal illnesses, affecting small numbers of patients.[56] The guidance stated that in such circumstances the Appraisal Committees would be asked to consider recommending the use of medicines for use in the NHS even though the incremental cost effectiveness ratio was in excess of £30,000 per quality adjusted life year (QALY), the commonly accepted value given to QALYs for all treatments.[57]

51. The supplementary guidance was circulated to PCTs for comment on 10 December 2008. Following a brief consultation period, NICE published its final guidance on 2 January 2009. To be covered by the supplementary guidance, a medicine would need to:

  • be licensed for treating "smaller populations" (not normally exceeding 7,000) of new patients each year;[58]
  • be indicated for the treatment of patients with a diagnosis of a terminal illness and who are not, on average, expected to live for more than 24 months;
  • have sufficient evidence to indicate that it offers a substantial average extension to life compared to current treatment; and
  • have been assessed by NICE as having an incremental cost effectiveness ratio in excess of the upper end of the range normally considered by NICE's Appraisal Committees to represent a cost-effective use of NHS resources.[59]

In addition, no alternative treatment with comparable benefits should be available through the NHS.

THE PHARMACEUTICAL PRICE REGULATION SCHEME

52. In January 2009 the Department announced a new Pharmaceutical Price Regulation Scheme (PPRS) which it hoped would result in "new, more flexible pricing arrangements" between the NHS and the pharmaceutical industry.[60] As a result of this agreement the Department argued that patients would benefit from cheaper, cost-effective, and innovative drugs.

53. The PPRS agreement with industry includes the following measures:

  • a reduction in the cost of drugs sold to the NHS: a 3.9% price cut was introduced in February 2009;
  • a further price cut of 1.9 % to be introduced in January 2010;
  • a new non-contractual voluntary scheme providing stability and predictability in Pharmaceutical Pricing for the next five years;
  • More risk-sharing arrangements between pharmaceutical companies and the NHS so that more flexible pricing arrangements will enable drug companies to supply drugs to the NHS at lower initial prices, with the option of higher prices if value is proven at a later date; and
  • the more systematic use of patient access schemes by drug companies to allow access to medicines which have not initially been assessed as cost or clinically effective by NICE.[61]

The Department expects the new scheme to "deliver savings of around £350m for the UK in 2009-10, and around £550m per year thereafter".[62]

Conclusions

54. Since 2008 the Department made a number of decisions to increase access to drugs. In November 2008, the Department accepted immediately all Professor Richards' recommendations and made a number of decisions to implement the recommendations:

In the next chapters we discuss some concerns about the Department's plans for implementing the Richards report.


40  
Department of Health, "Improving access to medicines for NHS patients" A report for the Secretary of State for Health by Professor Mike Richards CBE, 4 November 2008 Back

41   Department of Health, "Improving access to medicines for NHS patients" A report for the Secretary of State for Health by Professor Mike Richards CBE, 4 November 2008. Back

42   Ibid.  Back

43   Q 237 Back

44   Q 226 Back

45   Q 219 Back

46   Ibid. Back

47   Q 239 Back

48   Recommendation 8 Back

49   Recommendation 9 Back

50   Q 222 and Q 240 Back

51   Ev 1 (HC 194-II) Back

52   Ibid. Back

53   Department of Health, Guidance on NHS patients who wish to pay for additional private care - A consultation, 4 November 2008 Back

54   Ev 1 (HC 194-II) Back

55   Department of Health, Guidance on NHS patients who wish to pay for additional private care, 23 March 2009 Back

56   Sometimes referred to as "rarer cancers" Back

57   Ev 60 Back

58   Professor Rawlins told us that his original guidance was for patient population not normally exceeding 7,000 (Q 244)  Back

59   Ev 1 (HC 194-II) Back

60   The aim of the PPRS is to ensure that the NHS has access to good quality branded medicines at reasonable prices, and promotes a healthy, competitive pharmaceutical industry. Back

61   Ev 1 (HC 194-II) Back

62   Ibid. Back


 
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