NHS prescription charges need a major shake-up with reforms to help
the less well-off and protect everyone against huge bills, says a report
published today.
The problem with the system of drug prescribing is that advances in
medical technology have dramatically increased the cost of health care.
Public spending will have to be carefully controlled, in the next few
years, says the independent policy think tank, the Institute of Economic
Affairs.
It calls for all exemptions to be scrapped and replaced by a new
system of ''catastrophe insurance''. Those on income support could be
given a plastic Medicard to get their treatment.
According to authors David G. Green and David A. Lucas: ''Under the
current system, 48% of the population and fully 82% of prescriptions are
exempt from any charge.
''Only 8% of the total cost is collected in charges. Compared to other
European countries our exemptions are too wide and our charges are too
low.
''People who are exempt, such as diabetics, are not required to pay
for any medicines, whereas in other European countries free drugs are
usually only available if they are necessary to treat the exempt
condition.
''Yet some people, with a strong case for exemption, and who would be
exempt if they lived in other European countries, are required to pay.''
Government controls may have perverse effects on doctors' decisions,
with damaging results for patients. There is already evidence that
therapeutic advances are being withheld from NHS patients, not because
of doubts about safety, but to curb spending, says the report.
It may also restrict the ability of the drugs industry to keep
producing the technical advances needed to maintain progress in
conquering disease.
''What really matters is that the least well-off can still afford the
medicines they need, and that everyone is protected against exceptional
costs.
''Most people can afford to pay for most of their drugs most of the
time, and there is no reason to interfere with that.
''All exemptions should be abolished and replaced by a new system of
'catastrophe insurance'. If drugs are sold at market prices, as we
propose, the general rule should be that persons falling below the
income support level would qualify for free prescriptions for themselves
and their dependants.
''Other special conditions should no longer entitle people to free
drugs.
''Instead, the existing pre-payment or 'season ticket' system should
be extended so that it becomes a system of voluntary 'catastrophe
insurance' for all.
''Those on income support or buying a pre-payment certificate could be
given a plastic Medicard, like a credit card, which would be presented
to the pharmacist, who would dispense the prescribed medicine without
further charge.
''The pharmacist of course would not know whether the customer had
paid for the card or not, removing the stigma that can be attached to
those on social security.''
The amount of money raised would depend on how many people bought the
Medicard rather than pay for each prescription. It could be between #1
billion and #2.7 billion.
The institute's estimate based on 70% of pensioners and 20% of other
people buying the Medicard, is that about #1.5 billion would be raised
-- nearly six times the meagre #250m raised by prescription charges.
This would be a worthwhile contribution towards funding welfare
services in the current difficult financial climate, says the report.
* Medicard: A Better Way To Pay for Medicines? is available from the
IEA, 2 Lord North St,London SWlP 3LB at #5.45.
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