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Health Act 2009

Part 1.Quality and Delivery of NHS Services in England

Chapter 3 - Direct payments

17.The Government made a commitment in High Quality Care for All to pilot personal health budgets, including piloting direct payments for health care where this would make most sense for particular patients in certain circumstances. Direct payments are monetary payments to patients with which they can procure health care services.

18.The Department published Personal Health Budgets: First Steps in January 2009, setting out its intentions for personal health budgets, including direct payments.(6)

19.Direct payments have been used in lieu of social care services for some time. Social care direct payments are payments for individuals to purchase services from various providers directly, to meet their social care needs. The Act allows for a similar model of direct payments to be used for health care.

20.Section 11 in Chapter 3 of Part 1 of the Act amends the National Health Service Act 2006 (NHS Act) to allow the Secretary of State to make monetary payments to patients in lieu of providing them with health care services. In practice the intention is to delegate this power to local NHS organisations, generally Primary Care Trusts (PCTs), though some Strategic Health Authorities or Special Health Authorities may also wish to use direct payments. Initially, the power will be available under regulations in pilot schemes only.

21.Direct payments for health care will allow patients to purchase health care services directly from a variety of providers, including private organisations and the voluntary sector.

22.The Act provides powers to allow the Secretary of State to make regulations to govern the operation of direct payments and direct payment pilot schemes. The regulations may make provision about the persons who might receive direct payments, potentially appropriate health conditions and the services in respect of which payments could be made. The regulations may also specify categories of patients who would not be able to access direct payments for health care, or services that could not be purchased. The regulations may provide for the necessary monitoring in order to ensure accountability and that direct payments are effective in meeting the health outcomes agreed between a patient and the NHS. Provision could also be made for money to be recouped in the event of a large surplus or misuse of direct payments.

23.The Government intends that every pilot scheme will be reviewed. The Government intends that the pilot programme as a whole should be reviewed by an independent person, the review should be published, and it should examine a range of issues. These include the administration of direct payments, the effect of direct payments on cost or quality of care, and the effect of direct payments on the behaviour of patients, carers or people providing services. Provision for review of a pilot scheme must be made in regulations.

24.Following a review there is an order making power, subject to approval by each House of Parliament under the affirmative resolution procedure, to remove the requirement that payments be made through a pilot scheme so that direct payments could become more generally available while still following rules in a framework established by regulations.


Department of Health (2007), Personal Health Budgets: First Steps, Department of Health, London. Available at: [1]

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