Managing Financial Resource

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There are financial implications for individuals accessing and using services in health care services, Evaluate the impact of these financial implication on service users. (AC 4.3)

The pursuit of equity of access to health care is a central objective of many health care systems. Yet, financial incentives can influence patients because, although the UK system is essentially ‘free at the point of use’, there are charges for specific services including eye tests, dental check-ups, and dispensing of prescription medicines. Charges can act as a deterrent to patients and as a barrier to access. The impact of user charges affects different socio-economic groups in different ways. For some groups, access may not be compromised by a co-payment, while for others the charge may represent a significant deterrent. The impact depends on the size of the co-payment and crucially depends on the patient’s ability to pay (and therefore directly links with equity considerations). The insurance market (and social insurance-based schemes such as the UK) essentially removes most of the financial barriers to access so that patients do not face the full cost of care. This in itself, of course, creates an incentive, where patients may over-consume services. Where this occurs, other patients with more pressing needs may have problems accessing services (waiting times will become longer and patients who require urgent care may be displaced). Furthermore, it is argued that insurance-based systems create a further problem, which is known as ‘moral hazard’, whereby individuals fail to take full responsibility for their own health because they do not face the full costs of any ill health associated with their behaviour (for example, smokers might not smoke if they had to pay the full costs of cancer treatment). Thus, insurance systems take away barriers to access and this may lead to inappropriate utilisation of services, or may lead to excess demand for services and the subsequent problems this causes with respect to prioritising care.

The theoretical impact of user charges, or fees, levied on services is straightforward. It is hypothesised that if people have to pay for a service they will use less of it. The main impact of user charges is, therefore, on utilisation. The rationale behind user charges is that they can be used to deter frivolous utilisation of services, raise revenue for the health service, and act as a reminder to individuals of the value of the services they consume. There are, however, clear disadvantages in that user charges can have the negative impact of potentially excluding low-income individuals from consuming beneficial health care services.

The National Health Services (NHS) since its inception has aimed to make health care available to all regardless of income, at the same time assuring equitable distribution of resources regionally. Until the reforms introduced by the 1989 White Paper, the NHS was characterised by centralised financing and regulation. There are, however, two main areas where user charges are imposed: dental services and prescription charges. The impact of user charges in these two health care sectors has been examined in the UK.

Recent changes in the NHS General Dental Service have arguably led to a reduction in the availability of NHS dental care and increased charges. A study by Stoelwinder (1994) explored public and user views and experiences of NHS and private dental care in the light of these changes. The study employed a combination of quantitative and qualitative methods. The first phase involved a postal survey of a random sample of adults on the electoral registers in a county in Southern England. Follow-up face-to face interviews were carried out with sub-samples selected from survey respondents. The evidence shows greater satisfaction with certain aspects of private dental care than with NHS care and suggests that the decline in perceived quality of NHS care is less to do with the...
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