NHS fraud crackdown sees millions in fines dished out to elderly, sick and others eligible for free treatment

Cash-starved NHS running ‘haphazard’ anti-fraud programme which could increase mental health problems and put eligible people off seeking care

Vulnerable patients have been wrongly fined millions of pounds by the NHS for prescription fraud, the National Audit Office has found.

One in three fines handed to the elderly, disabled or people on benefits in the past five years has been overturned because recipients qualified for free treatment – meaning more than £188m in incorrect penalties.

Critics said the mistakes, affecting tens of thousands of patients, showed the government’s austerity measures have led to a system “built on the presumption of guilt”.

They say that since a crackdown starting in 2014, debt collectors have been sent to those caught out by needlessly complex eligibility rules surrounding prescriptions and dental charges.

“This report seems to show the NHS scrabbling ever more desperately for cash over the last few years, and inflicting needless distress on patients as it does so,” said John Kell, head of policy at the Patients Association.

He called the system “haphazard” and unjust, with 31p of every pound recovered spent chasing offenders and fighting appeals.

Receiving notice of a penalty of up to £100 could even worsen mental health among the vulnerable who may not have funds to pay or support to challenge it.

“Far too many members of the public are on the receiving end of distressing, threatening letters or fines which could impact their mental wellbeing,” said Dr Richard Vautrey, chair of the British Medical Association’s GP committee.

Sir Amyas Morse, head of the NAO, said it was “reasonable” for the health services to seek to reclaim funds and deter prescription fraud.

He added: “However, the NHS also needs to have due regard to people who simply fall foul of the confusing eligibility rules. It is not a good sign that so many penalty charge notices are successfully challenged.”

The NHS issues more than a billion prescription items each year and roughly nine out of 10 of these are given free because of exemptions.

Among the groups who are exempt from charges are children, over-60s, those with long term medical conditions, people on low incomes and those on certain benefits.

However, an estimated £212m was lost to the NHS last year from wrongly claimed exemptions, both fraudulent and accidental, the NAO report said.

The NHS Business Services Authority (BSA) was commissioned to ramp up checks on exemption claims and issue penalty charges to those who are ineligible.

Checks have risen from 750,000 in 2014-15 to 24 million last year. The value of penalties issued in the same period has risen from £12m to £126m a year for prescriptions, and from £38m to £72m for dental treatment.

But only around one in five of these notices issued since 2014 has been paid, with 30 per cent withdrawn after the person proved their eligibility, and many where the offender was never traced.

While the fraud bill has fallen by around £50m, medical leaders have warned the system could be doing much more damage to those who have made innocent mistakes, while missing the worst offenders.

The British Dental Association has warned of two million fewer free treatments among eligible people, a drop of 23 per cent since 2014-15, while fines have risen 100-fold in the past four years.

“There can be no excusing the fact innocent people, fully entitled to claim free care, have been slapped with over £180m in fines,” said Charlotte Waite of the British Dental Association.

In contrast to other UK nations, Ms Waite added that England “has a system built on a presumption of guilt, which offers few signposts, and has left vulnerable patients chased by debt collection agencies”.

Repeat offenders have now been passed to the police or debt collection agencies, but the NAO report says the BSA is well aware that “genuine mistakes and confusion happen”.

The report says matters have been complicated by the introduction of Universal Credit, which has included an income threshold for some benefits entitlements. Also confusing is the fact that not all claimants are automatically eligible for free dentistry and prescriptions.

Despite this, the NHS only began working to explain its fraud crackdown and develop eligibility checkers in 2017, the NAO report said.

Brendan Brown, director of citizen services at BSA, said they welcomed the report. “The rules around entitlement, which are set by the Department of Health, can be complicated to understand and we recognise that genuine mistakes and confusion happen.

“We strongly believe in educating patients and ultimately removing error, so we can efficiently tackle deliberate fraud.”

The Department of Health and Social Care was approached for comment.