King's Fund highlights possible post-Brexit health and social care issues

The King's Fund, a United Kingdom (UK) health charity and advisory think-tank, has published a report assessing the possible impact of the UK leaving the European Union (EU) on various key issues affecting the health and social care sectors, following the 52% vote in favour of departure in the referendum held on 23 June 2016. The report notes that the UK vote has triggered a period of economic and political uncertainty, at a time when the healthcare system faces major operational and financial pressures, and highlights five major issues for consideration. The report can be accessed here.

Staffing

Currently, many healthcare professionals working in the UK are from other EU countries, and have benefited from the EU's freedom of movement policy and mutual recognition of professional qualifications. This includes 55,000 out of 1.3 million National Health Service (NHS) workers and 80,000 out of 1.3 million in social care. The NHS has had much-publicised problems with recruiting and retaining permanent staff, particularly nurses, midwives and health visitors – with a stated shortfall in 2014 of 5.9%, or 50,000 full-time equivalents (FTEs). The social care sector has similar problems, with a 2015 vacancy rate of 5.4%, rising to 7% in domiciliary care, and a very high turnover rate of 25.4% (300,000 workers leaving per year).

The freedom of movement policy is still in place, but EU nationals need to be reassured by the government that their positions are safe in the longer term, or many are likely to decide to move to other EU countries. The report points out that the NHS England Medical Director Bruce Keogh and the Health Secretary Jeremy Hunt have both sought to reassure EU staff currently working in the NHS, but recommends further action to safeguard the ability of healthcare providers to recruit EU staff when there are not enough UK workers to fill vacancies.

Access to treatment in the UK and abroad

The report recognises that, while immigration has increased the overall population, and thus the number of potential NHS users, the average use of NHS services by immigrants and visitors has been lower than for UK citizens, perhaps partly because the immigrants/visitors tend to be younger.

Currently, EU citizens are entitled to a European Health Insurance Card (EHIC), giving access to state healthcare during a temporary stay in any European Economic Area (EEA) country, followed by reclamation of costs via reciprocal healthcare agreements. In addition, EU rules allow EU citizens living in the UK, or UK citizens living elsewhere in the EU, to have access to healthcare on the same basis as nationals of that country. It is estimated that 1.2 million UK migrants are resident in other EU countries, and around 3 million EU migrants are in the UK. The report cites concern that UK pensioners living elsewhere in the EU may return, increasing pressure on health and social care services. The report recommends that the government negotiates new reciprocal arrangements with the EU on access to healthcare services for UK citizens/visitors abroad and EU citizens/visitors in the UK, or seek to continue existing arrangements.

Regulation

In several important areas which impact on the health and social care sectors, current EU regulations will need to be reviewed, and decisions made on whether to maintain them in their current form or replace them with UK-drafted alternatives. These include:

1. The working time directive

The EU Working Time Directive limits the maximum amount of time that employees in any sector can work to 48 hours per week, and sets minimum requirements for rest periods and annual leave. There is an opt-out clause for doctors for the 48-hour limit. Repealing or amending the associated UK regulations would have significant implications for NHS employment contracts.

2. Procurement and competition law

Since relevant EU directives relating to procurement and competition have already been incorporated into UK law, this law would need to be repealed or amended to change current arrangements. However, the report states that it seems unlikely that leaving the EU would have a significant impact on NHS procurement and competition regulation.

3. Pharmaceutical regulation

Currently, the UK is part of the centralised EU drug authorisation system, operated by the European Medicines Agency (EMA), based in London. The EMA evaluates newly developed human and veterinary medicines for use in the EU, via a single application system for marketing authorisations valid in the EU, EEA, and European Free Trade Association (EFTA) countries. Following exit from the EU, the EMA premises would have to be moved to another EU country, although the UK could still make use of the EEA/EFTA inclusion to continue its relationship with the EMA. However, if the latter was not the case, pharmaceutical companies would have to apply separately to the UK's national regulatory authority, the Medicines and Healthcare products Regulatory Agency (MRHA), for approval of any drugs they wished to market in the UK.

4. Clinical trials

Currently, clinical trials are conducted on a national level, but planned regulations should harmonise arrangements across the EU to create a single entry point for companies conducting trials of new drugs in different countries. Concerns have already been expressed in the pharmaceutical industry that the UK's departure from the EU could result in losing out on some clinical trials that could otherwise benefit patients, since they would not be part of this scheme.

Cross-border co-operation

The report highlights important areas in which the EU facilitates cross-border collaboration on public health issues, including the European Centre for Disease Prevention and Control's surveillance and early warning systems for communicable diseases. In addition, the pooling of resources for research talent and sources of funding via the EU has been key in the advancement of the UK's scientific research agenda. For example, in 2007–13 the UK contributed EUR5.4 billion (USD6.0 billion) to EU research and development, but also received EUR8.8 billion for its own research and innovation. Other networks, for example those covering rare diseases with low numbers of patients in each country, may also be affected. The report recommends prioritisation of the topics of research funding and free movement of researchers across Europe in upcoming negotiations.

Funding and finance

A high-profile claim of the Vote Leave campaign was that the UK's EU membership fee of GBP350 million (USD453 million) could be spent on the NHS and other priorities, including a specific pledge to implement an additional GBP100 million per week cash injection. Leaders of the campaign have since distanced themselves from these claims.

With NHS leaders already facing significant financial pressures in 2016/17, and performance against key targets deteriorating, the report cites the performance of the UK economy as being the most important influence on NHS funding in the coming year. If the vote to leave the EU creates economic instability and uncertainty, cuts in public spending are likely. Also, a prolonged decline in the value of sterling would increase inflation, leading to higher prices for some drugs and other goods and services for the NHS. When the Prime Minister steps down in September 2016 and the new government issues an Autumn Statement and emergency budget, it appears likely that taxes may have to rise and public spending be cut further. Even if the health budget is protected, further cuts to social care funding would have a knock-on effect on the NHS.

The King's Fund recommends that the NHS needs additional funding over and above that announced in the last Spending Review, particularly covering the period 2018/19, and that additional funding is needed for social care, which has already experienced cuts affecting around 400,000 people.

Outlook and implications

The report highlights the major task faced by the DH in reviewing individual EU regulations and either repealing or replacing them with UK-drafted alternatives, and notes that the DH is also implementing a significant staff reduction programme. In addition, the DH will need to re-prioritise previous plans for policy announcements and publications, in the light of the Brexit vote. It concludes that, while the immediate focus will be on negotiating favourable terms with the EU for trade and work, the government should not neglect the health and social care sectors, or there could be profound implications for the UK population.

Many of the concerns cited in this report appear uncontroversial, and coincide with points raised in IHS's assessment of the potential impact of the Brexit vote on the UK pharmaceutical industry (see United Kingdom: 24 June 2016: Implications for pharma as Britain votes to exit EU). IHS will continue to monitor for evidence of any deterioration in health provision in the UK and/or regulatory changes, and has already adjusted its pharmaceutical industry forecasts for the UK and certain key trade partner markets downwards following the Brexit vote (see United Kingdom: 5 July 2016: IHS adjusts pharma industry forecasts post-Brexit).