Health Bill [HL]

My Lords, I will speak to Amendment 67 in my name. It is a classic transparency amendment: my argument is that the provision of information will alter conduct. I follow modestly in the footsteps of the noble Lord, Lord Palmer, who has been a doughty campaigner and persistent advocate on this matter for a number of years. He whetted my appetite in Committee, since when I, too, have carried out wide consultation. My amendment does not set a threshold, as does that of the noble Lord, Lord Palmer. His amendment is more practical; my objective is slightly different. I am trying to secure a more fundamental review of prescription-charging policy by provoking argument over the costs of generic medicines to the public in circumstances where generic drugs often cost but a few coppers, yet the patient can pay more than £7 for a prescription. To understand the impact of my amendment, we must go back to the complicated arrangements for remunerating pharmacists, and also consider what options are available to the patient who wants to avoid paying a high prescription charge where exemptions do not apply. As I understand it, pharmacists receive a dispensing fee of 90p per item from the Department of Health. They can receive a practice payment of about 70p from the PCT. There is a container allowance of about 3p and an establishment fee of approximately £25,000 a year. I understand that a few additional sums are available, and that reimbursement for the cost of drugs is made by the Department of Health through the PCTs. Item-purchasing costs to the pharmacists vary, but they fall into two broad groups; the costs of generic medicines under the tariff, and the costs of branded products under the PPRS. To defend the interests of NHS budgets and the taxpayer, the Department of Health exerts pressure on reimbursement costs by applying a discount system. This is published in the tariff, which I have studied in some detail. A cursory examination of the tariff quickly reveals the wide discrepancy between the price of some products and the prescription costs to non-exempt patients. Sometimes the cost is far higher than the prescription cost; sometimes it is far lower. Yet the cost of most generic prescriptions is lower. Doctors and pharmacists have devised different arrangements for lessening the impact of prescription costs on non-exempt patients. Some pharmacists stock a special category of medicines that substitute for prescribed drugs. These can be sold to the patient at a price that is less than the cost of a prescription as a sort of over-the-counter product. Some have tried to get round the prescription costs by simply selling the prescribed drugs to the patient at a tariff/branded product-plus price, but that has been stopped by the Department of Health on the basis that the prescription form used is for NHS prescription use only. Some doctors give their patients private prescriptions that bypass the NHS prescription arrangements. By using a private prescription, a patient can make substantial savings on the NHS prescription price, but only of course when the retail price is less than £7.20. What would my amendment do? It would amend the National Health Service (Pharmaceutical Services) Regulations 2005 by making it a requirement to include on the packaging of any drugs or appliances a label showing the reimbursement price. There would also need to be some further amendment in the schedule under the section dealing with terms of service for pharmaceutical contractors. By inserting the words in the amendment, we would add an additional line on information that is provided to the patient indicating reimbursement costs. That being the case, we would have to define within the interpretation provision what is meant by reimbursement price. Retail costs would be meaningless for the purposes of my amendment. For generic products the price would be the tariff price and for branded products it would be the manufacturer’s list price. In its report on Department of Health: Prescribing Costs in Primary Care of January 2008 the Public Accounts Committee recommended: ""The Department should do more to make patients aware of the costs of drugs, and hence the importance of not wasting them, for example by displaying on dispensed drugs information such as the cost of the specific items dispensed or an indication of the typical cost of items to the NHS"." I presume that that comment must have followed an investigation by the PAC, itself following a report by the National Audit Office. I hope that the department will take that into account. Is it practical to do all this? Yes, because the technology is there; it is already used on private prescriptions. What would the impact be? There would be greater transparency; it may well reduce the element of wastage; it would save the patient money; there would be some unquantifiable cost to the Department of Health, and perhaps Ministers can put a figure on that. However, that has to be set against the potential for reduced wastage. Since 1997, there has been a 59 per cent increase in the number of prescriptions issued by doctors. Some useful work has been done on wastage, sponsored by the Department of Health, by a joint team from York University and the School of Pharmacy in London. I understand that the report, which is due to be published later this year, will deal with the psychology and behavioural effect in medicine-taking. It should give us an insight into issues of wastage and, I hope, it might even point towards the scheme that I am advocating. Equally it might point the other way. On that point, I thank my noble friend Lord Darzi for the letter that he sent to the noble Lord, Lord Palmer, and me, prior to this debate, setting out the department’s position. In many ways, price labelling might have a far more interesting knock-on effect, particularly on sub-prescription-charge generic products. It could provoke a real discussion on the future of prescription charges. Is it fair to levy such a high cost on the non-exempt groups for low-cost generics? I suggest that it is not.