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Prescription charges – a pharmacy
perspective

             Eileen Neilson
             Head of Policy
             Development, RPSGB
             23 March 2009
             eileen.neilson@rpsgb.org
The RPSGB


• The Royal Pharmaceutical Society of
  Great Britain is the professional and
  regulatory body for pharmacists in
  England, Scotland and Wales
• Pharmacy as a profession
• Medicines and their use
• www.rpsgb.org
Medicines as an intervention


• Medicines are the most common
  clinical intervention in the NHS
• Medicines cost the NHS around £11
  billion a year (NPC, 2008)
• Medicines = 2nd largest item of NHS
  expenditure (largest = staff costs)
  (NPC, 2008)
• Pharmacists are the experts on the
  uses and actions of medicines
Rising prescription volume in England
source: NHS Information Centre, Prescriptions Dispensed in the Community 1997-2007 (published
July 2008)




   800
   700
   600
   500
                                                              Number of
   400
                                                              prescription
   300                                                        items (million)
   200
   100
      0
          1997 1999 2001 2003 2005 2007
Prescriptions volumes & charges -
   England

• 796 million prescription items were
  dispensed in 2007
• Increase of 5.9% on 2006 and 59.2%
  increase from 1997
• Prescription charge is currently £7.10
• On April 1, 2009 it will rise to £7.20
• 11.4% of items attracted prescription
  charges in 2007
• (88.6% of prescribed items were dispensed
  free)
Problems with the current system of
   prescription charges & exemptions

• Widely perceived to be illogical and unfair
• Current medical exemptions date back to
  1968 when many treatments now available
  for LTCs did not exist
• New conditions (e.g. AIDS) have emerged
  since
• Some people with low incomes pay
  charges while others with higher incomes
  (e.g. better-off pensioners, pregnant
  women) do not
Problems with current system cont./


• Clear evidence that charges deter essential
  use of medicines in people with LTCs
• Switching the medical exemptions around
  would still leave some people with LTCs
  disadvantaged
• Charges are not the best way of reducing
  impact of unnecessary prescribing (use
  measures to control prescribing)
Current exemption categories

• Are 60 or over
• Are under 16
• Are 16-18 and in full time education
• Are pregnant or have had a baby in the previous 12 months and
have a valid exemption certificate
• Have a listed medical condition and have a valid exemption
certificate
• Have a continuing physical disability which means you cannot go
out without help from another person and have a valid exemption
certificate
• Hold a valid war pension exemption certificate and the prescription
is for your accepted disablement
• Are an NHS in-patient
• Or your partner receive income support, income based
Jobseekers Allowance, income related Employment and Support
Allowance, Pension Credit Guarantee Credit or you are named on,
or are entitled to an NHS tax credit exemption certificate
• are a woman with a prescription for contraceptives.
Medical exemptions


•Permanent fistula
•Hypoadrenalism (including Addison’s disease)
•Diabetes mellitus
•Hypoparathyroidism
•Myasthenia gravis
•Myxoedema
•Epilepsy
•Continuing physical disability that prevents the
patient from leaving his/her residence without the
help of another person
RPSGB review on prescription
    charges

• In 2005 RPSGB published an international review
  on prescription charges – Prescription charges –
  should they be abolished?
  (http://www.rpsgb.org/pdfs/prescriptcharges.pdf)
• Cost sharing decreases use of prescription
  medicines by poor and chronically ill (Lexchin &
  Grootendorst, 2004)
• 2/3 of people with LTCs have difficulty paying
  prescription charges (NACAB, 2001)
• 750,000 people fail to make full use of prescription
  medicines due to cost (MORI, quoted in NACAB,
  2001)
• Charges may also affect the decision to consult
  (Doran et al 2004)
Impact of deterring essential use of
    medicines
• Deterrence results in preventable morbidity giving
  rise to additional costs elsewhere in the system
  (e.g. preventable hospital admissions)
• American study of mentally ill patients living in the
  community faced with a cap on reimbursable drug
  expenditure: increase in hospital admissions led to
  cost increases of 17 times the drug costs saved
  (Soumerai et al 1994)
• Canadian study on impact of charges introduced
  in 1996 found that use of essential medicines
  decreased and hospital admissions rose (Tamblyn
  et al 2001)
• Abolition should therefore result in savings
  elsewhere in the health system
RPSGB policy on prescription
    charges
• There should be no financial barrier for patients to
  the use of prescribed medicines (long-held
  RPSGB policy)
• Review findings implied either a move to abolition
  or major reform of the existing charging scheme
  with little/no deterrent effect to essential use of
  medicines
• Abolition should be carefully planned &
  implemented (Italy – abrupt abolition destabilised
  GP & CP)
• RPSGB called on government to review
  prescription charges and exemptions
• And commission research on impact of charges on
  non-exempt people with LTCs
Implications of charges for
   Government
• Government has two interests:
  • As financier (Treasury) - wants to collect revenue
  •     In 2007-08 prescription charges raised ~£450m and
  cost £50m to administer
  •     If exemptions ceased to be total, easy to raise
  equivalent income e.g. if all except very poor paid up to £100
  p.a.
  •     Abolition would reduce need for government audit and
  counter-fraud activity re. fraudulent exemption claims
  •As health policy maker (Dept of Health) - wants to improve
  health outcomes
    Both have an interest in the most efficient use of
    funds
Impact on government cont./

•The least cost effective medicine is one
that is not used properly or at all
•88.6% of prescriptions are dispensed free
already
•Cancer patients exempt from April 2009
for all their medication
•If complete exemptions extended, current
system would collapse as so few would
pay
Impact of abolition on community
   pharmacy role

• End of ‘tax collector’ role (which many
  pharmacists dislike)
• Better relationships with patients:
    - Some patients think pharmacists keep
  the charges (legitimately)
    - Some patients think pharmacists
  responsible for increasing charges
    - End to disputes about whether
  patients are genuinely exempt
Impact of abolition cont./

• Reduced workload from collecting
  prescription charges and associated
  administration with reimbursement
• Frees up more time for patient care →
  improved health outcomes
• End of ‘switching errors’ (reimbursement
  claims)
• Simpler staff training on prescription
  charges
• Pharmacists often asked which medicines
  are essential (if patients can’t afford all the
  charges) – invidious
Other potential impacts on pharmacy


• Reduced OTC sales
  •UK OTC market = £2.3 billion p.a.
  •Potential impact of abolition on OTC
  sales and ‘counter prescribing’
  workload if products prescribed
  instead of purchased
Potential impacts on pharmacy cont./


• Impact on pharmacy cash flow
• Fears that reformed exemption scheme
  could be administrative nightmare
• Impact on minor ailment schemes (MAS)
  (diverts minor ailments to CP; exempt
  patients can access OTC treatment free)
• http://www.rpsgb.org.uk/pdfs/bettmanminail.pdf
Staged abolition in Scotland and
     Wales

• Scotland            •   Wales
•   2007 - £6.85      •   2001 - £6
•   2008-09 - £5      •   2004 - £5
•   2009-10 - £4
                      •   2005 - £4
•   2010-11 - £3
                      •   2006 - £3
•   By 2011 - zero
                      •   2007 – zero
Impact of abolition in Scotland

•GPs in Scotland - responsibility not to
prescribe differently when charges
abolished
•Feared upsurge in OTCs being provided
on the NHS has not happened
(www.theherald.co.uk/misc/print.php?artid=2485067)

•Impact on minor ailment schemes has not
been assessed (one of 4 core services
provided by all CPs)
•No. of prepayment certificates has
doubled
Number of pre-payment certificates
  purchased in Scotland has doubled

800
700
600
500
                                      Number of
400
                                      prescription
300                                   items (million)
200
100
 0
      1997 1999 2001 2003 2005 2007
Impact of abolition in Wales

•Prescription items rose by 2.9 million (5%) in the
first year
•Anecdotally ‘there was…an initial blip when free
prescriptions came in but then it settled down’
•Numbers of prescriptions per person are similar in
England and Wales (OHE, 2009)
•Welsh experience to date doesn’t show an
increase in the volume of prescriptions (PSNC
view)
•Limited impact on prescription numbers (NPA
view)
Research on impact of abolition in
   Wales

• Wales PREscription Fee Exemption
  Research Study (PREFERS)
• Began 2006
• Funded by the Wales Office for Research
  and Development in Health and Social
  Care
• Publication due shortly
Aims:
• Assess impact of abolition
• Does abolition enhance access to
  medicines?
Concluding remarks

•Findings of evaluation in Wales and
Scotland re. impact of abolition will be
important
•Particularly re. access to medicines and
impacts on health
•So far, indications are that a staged
approach has avoided major negative
impacts

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Prescription Charges

  • 1. Prescription charges – a pharmacy perspective Eileen Neilson Head of Policy Development, RPSGB 23 March 2009 eileen.neilson@rpsgb.org
  • 2. The RPSGB • The Royal Pharmaceutical Society of Great Britain is the professional and regulatory body for pharmacists in England, Scotland and Wales • Pharmacy as a profession • Medicines and their use • www.rpsgb.org
  • 3. Medicines as an intervention • Medicines are the most common clinical intervention in the NHS • Medicines cost the NHS around £11 billion a year (NPC, 2008) • Medicines = 2nd largest item of NHS expenditure (largest = staff costs) (NPC, 2008) • Pharmacists are the experts on the uses and actions of medicines
  • 4. Rising prescription volume in England source: NHS Information Centre, Prescriptions Dispensed in the Community 1997-2007 (published July 2008) 800 700 600 500 Number of 400 prescription 300 items (million) 200 100 0 1997 1999 2001 2003 2005 2007
  • 5. Prescriptions volumes & charges - England • 796 million prescription items were dispensed in 2007 • Increase of 5.9% on 2006 and 59.2% increase from 1997 • Prescription charge is currently £7.10 • On April 1, 2009 it will rise to £7.20 • 11.4% of items attracted prescription charges in 2007 • (88.6% of prescribed items were dispensed free)
  • 6. Problems with the current system of prescription charges & exemptions • Widely perceived to be illogical and unfair • Current medical exemptions date back to 1968 when many treatments now available for LTCs did not exist • New conditions (e.g. AIDS) have emerged since • Some people with low incomes pay charges while others with higher incomes (e.g. better-off pensioners, pregnant women) do not
  • 7. Problems with current system cont./ • Clear evidence that charges deter essential use of medicines in people with LTCs • Switching the medical exemptions around would still leave some people with LTCs disadvantaged • Charges are not the best way of reducing impact of unnecessary prescribing (use measures to control prescribing)
  • 8. Current exemption categories • Are 60 or over • Are under 16 • Are 16-18 and in full time education • Are pregnant or have had a baby in the previous 12 months and have a valid exemption certificate • Have a listed medical condition and have a valid exemption certificate • Have a continuing physical disability which means you cannot go out without help from another person and have a valid exemption certificate • Hold a valid war pension exemption certificate and the prescription is for your accepted disablement • Are an NHS in-patient • Or your partner receive income support, income based Jobseekers Allowance, income related Employment and Support Allowance, Pension Credit Guarantee Credit or you are named on, or are entitled to an NHS tax credit exemption certificate • are a woman with a prescription for contraceptives.
  • 9. Medical exemptions •Permanent fistula •Hypoadrenalism (including Addison’s disease) •Diabetes mellitus •Hypoparathyroidism •Myasthenia gravis •Myxoedema •Epilepsy •Continuing physical disability that prevents the patient from leaving his/her residence without the help of another person
  • 10. RPSGB review on prescription charges • In 2005 RPSGB published an international review on prescription charges – Prescription charges – should they be abolished? (http://www.rpsgb.org/pdfs/prescriptcharges.pdf) • Cost sharing decreases use of prescription medicines by poor and chronically ill (Lexchin & Grootendorst, 2004) • 2/3 of people with LTCs have difficulty paying prescription charges (NACAB, 2001) • 750,000 people fail to make full use of prescription medicines due to cost (MORI, quoted in NACAB, 2001) • Charges may also affect the decision to consult (Doran et al 2004)
  • 11. Impact of deterring essential use of medicines • Deterrence results in preventable morbidity giving rise to additional costs elsewhere in the system (e.g. preventable hospital admissions) • American study of mentally ill patients living in the community faced with a cap on reimbursable drug expenditure: increase in hospital admissions led to cost increases of 17 times the drug costs saved (Soumerai et al 1994) • Canadian study on impact of charges introduced in 1996 found that use of essential medicines decreased and hospital admissions rose (Tamblyn et al 2001) • Abolition should therefore result in savings elsewhere in the health system
  • 12. RPSGB policy on prescription charges • There should be no financial barrier for patients to the use of prescribed medicines (long-held RPSGB policy) • Review findings implied either a move to abolition or major reform of the existing charging scheme with little/no deterrent effect to essential use of medicines • Abolition should be carefully planned & implemented (Italy – abrupt abolition destabilised GP & CP) • RPSGB called on government to review prescription charges and exemptions • And commission research on impact of charges on non-exempt people with LTCs
  • 13. Implications of charges for Government • Government has two interests: • As financier (Treasury) - wants to collect revenue • In 2007-08 prescription charges raised ~£450m and cost £50m to administer • If exemptions ceased to be total, easy to raise equivalent income e.g. if all except very poor paid up to £100 p.a. • Abolition would reduce need for government audit and counter-fraud activity re. fraudulent exemption claims •As health policy maker (Dept of Health) - wants to improve health outcomes Both have an interest in the most efficient use of funds
  • 14. Impact on government cont./ •The least cost effective medicine is one that is not used properly or at all •88.6% of prescriptions are dispensed free already •Cancer patients exempt from April 2009 for all their medication •If complete exemptions extended, current system would collapse as so few would pay
  • 15. Impact of abolition on community pharmacy role • End of ‘tax collector’ role (which many pharmacists dislike) • Better relationships with patients: - Some patients think pharmacists keep the charges (legitimately) - Some patients think pharmacists responsible for increasing charges - End to disputes about whether patients are genuinely exempt
  • 16. Impact of abolition cont./ • Reduced workload from collecting prescription charges and associated administration with reimbursement • Frees up more time for patient care → improved health outcomes • End of ‘switching errors’ (reimbursement claims) • Simpler staff training on prescription charges • Pharmacists often asked which medicines are essential (if patients can’t afford all the charges) – invidious
  • 17. Other potential impacts on pharmacy • Reduced OTC sales •UK OTC market = £2.3 billion p.a. •Potential impact of abolition on OTC sales and ‘counter prescribing’ workload if products prescribed instead of purchased
  • 18. Potential impacts on pharmacy cont./ • Impact on pharmacy cash flow • Fears that reformed exemption scheme could be administrative nightmare • Impact on minor ailment schemes (MAS) (diverts minor ailments to CP; exempt patients can access OTC treatment free) • http://www.rpsgb.org.uk/pdfs/bettmanminail.pdf
  • 19. Staged abolition in Scotland and Wales • Scotland • Wales • 2007 - £6.85 • 2001 - £6 • 2008-09 - £5 • 2004 - £5 • 2009-10 - £4 • 2005 - £4 • 2010-11 - £3 • 2006 - £3 • By 2011 - zero • 2007 – zero
  • 20. Impact of abolition in Scotland •GPs in Scotland - responsibility not to prescribe differently when charges abolished •Feared upsurge in OTCs being provided on the NHS has not happened (www.theherald.co.uk/misc/print.php?artid=2485067) •Impact on minor ailment schemes has not been assessed (one of 4 core services provided by all CPs) •No. of prepayment certificates has doubled
  • 21. Number of pre-payment certificates purchased in Scotland has doubled 800 700 600 500 Number of 400 prescription 300 items (million) 200 100 0 1997 1999 2001 2003 2005 2007
  • 22. Impact of abolition in Wales •Prescription items rose by 2.9 million (5%) in the first year •Anecdotally ‘there was…an initial blip when free prescriptions came in but then it settled down’ •Numbers of prescriptions per person are similar in England and Wales (OHE, 2009) •Welsh experience to date doesn’t show an increase in the volume of prescriptions (PSNC view) •Limited impact on prescription numbers (NPA view)
  • 23. Research on impact of abolition in Wales • Wales PREscription Fee Exemption Research Study (PREFERS) • Began 2006 • Funded by the Wales Office for Research and Development in Health and Social Care • Publication due shortly Aims: • Assess impact of abolition • Does abolition enhance access to medicines?
  • 24. Concluding remarks •Findings of evaluation in Wales and Scotland re. impact of abolition will be important •Particularly re. access to medicines and impacts on health •So far, indications are that a staged approach has avoided major negative impacts