Comments on the Daily Mail item - Millions of patients pay 40p a minute to phone their GP

The Daily Mail reports reports a claim by Network Europe Group that “Up to 200 doctors' practices have switched to the controversial 0844 numbers in the past six months”.

I have issued a briefing and media release in response to this news:

Government efforts to prevent NHS GPs ripping off patients through use of revenue sharing telephone numbers have failed - this must now change!

"Ban" on use of expensive (revenue sharing) telephone numbers - Briefing to all PCTs and SHAs

This posting is for a general briefing, however it contains the essence of a message distributed to the Chief Executives of ALL PCTs and SHAs in England.

An earlier message from me on this subject and the related briefing material covers, and provides more detail on, some of the points made below.

These comments are prepared in the light of recent comments published by

• the BMA
• and NEG Ltd
• and answers to questions in parliament given by the Minister of State (Health Services).

There could be a cloud of confusion that needs to be dispelled. I offer my assistance and urge verification of my comments.

The Directions to NHS bodies concerning the cost of telephone calls issued on 21 December 2009
must be considered, in effect, to represent
a ban on the use of 084 telephone numbers in the provision of NHS services.

As there is no general regulation of the cost of calling particular telephone number ranges, the Department of Health requires that attention be given to the actual costs incurred by patients. It has however (so far) failed to understand the effect that revenue sharing, which applies to all 084 numbers, has on unregulated charges in the market.

Regardless of undertakings by GP system providers and the perverse effects seen in some telephone tariffs (under some circumstances as a result of legacy regulations that apply only to BT), the cost of paying the revenue share that provides financial benefits to all users of 084 numbers is generally passed on to callers.

The Minister and the Department of Health are quite correct to declare that in a NHS "free at the point of need" NO PATIENT should be required to pay for access to NHS services, even if the money is collected, and the financial benefit is received, indirectly.

System providers to GPs and others can issue any personal undertaking they wish about the cost of calling, it has no meaning. The cost of a telephone call is set by whoever provides telephone service to the patient. Some may have been totally misled on this point, or led to accept a false belief that charges to callers are set by agreement with the called party.

This briefing document shows that those who pay more to call any 084 number than the equivalent cost of a call to a normal ("geographic") number include all users of:

Public Payphones, all Virgin Media landlines, all Contract and PAYG Mobiles.

If any NHS provider could be sure that no patient would call using these (or some other) services, then it could continue using a 084 number. Unlike 084x, 03xx numbers are subject to general regulation; this requires that the cost of calling may be no more than that of calling a geographic number.

I have invited recipients of my message to verify my comments with those having the relevant authority and let me know if they are challenged. I have also asked to be advised if there is any known situation where there are no patients who would call under the terms of the types of tariff listed above.

I must urge anyone reading this briefing who can identify any factual errors here, or in the any of the supportive material, to please submit a comment or contact me.

Advice to NHS Bodies 1 - Introduction and Summary

Advice to NHS Bodies concerning the cost of telephone calls

1 - Introduction and Summary

In support of the Directions to NHS bodies concerning the cost of telephone calls issued by the Department of Health on 21 December 2009, I offer some supportive advice.

The "Dear Colleague" letter accompanying the Directions makes it clear that these directions do not explicitly represent a prohibition on use of 084x numbers. Each NHS body is left to draw its own conclusions about which "contact telephone numbers have the effect of the patient paying a premium above the cost of a call to a geographical number". Given that telephone tariffs are set nationally, this means that the same work has to be done time and time again.

To perhaps help avoid some unnecessary effort and possible error I offer this advice to all NHS bodies. My authority to do so derives from many months of engagement in the issue and appropriate research and study. I must urge verification of all that I say with Ofcom and, as necessary, with all of the 200 or so registered providers of telephone service in the UK.

PLEASE ADVISE ME OF ANY ERRORS in the general comments I make or the detailed information I provide, as I seek to be wholly objective and would wish to immediately correct any false or misleading information.

The advice offered

Apart from the comments made below, I present this advice in two separate publications.

Firstly, I offer some general comments on a number of relevant issues.

These are intended to help correct some common false assumptions and misunderstandings.

Secondly, I address what is demanded of NHS bodies by the Directions.

The determination demanded by the DoH Directions requires knowledge of which telephone tariffs apply to patients who may call numbers used in the delivery of NHS services. Most tariffs pass on the cost of the revenue sharing associated with all 084x numbers to callers, thereby making these calls more expensive. There are however cases where calls to geographic numbers are subject to a greater premium charge (e.g. the penalty charge imposed for calling outside the time period during which an inclusive package is in effect), thereby exceptionally making an equivalent geographic call more expensive.

To comply with the Directions it would only be possible to use a 084x number if it could be established that the only tariffs applying to patients likely to call it were those which had this perverse effect in place.

To help with this determination, I therefore present lists of published current residential telephone tariffs classified according to the relative cost of weekday daytime calls to relevant types of number. If any patient could perhaps call under the terms of a tariff on the first of these lists then 084x numbers may not be used in the delivery of NHS services.

Conclusions

It may be noted that this first list list includes the tariff for BT Public Payphones, all tariffs offered by Virgin Media and all the Contract and PAYG tariffs offered by the major mobile providers.

As the inevitable conclusion would therefore appear to be that 084x numbers cannot be used in the provision of NHS services, it is perhaps strange that the Department of Health was unable to come to this conclusion itself and act accordingly, thereby saving a lot of possibly unnecessary work.

I must therefore urge anyone who can offer an alternative conclusion to contact me and point out the possible flaws in my information and thinking. Given the amount of time that the DoH has dedicated to this issue and the amount of good advice that it has received in the process, it is difficult to believe that it could have got things so wrong.

I would be delighted to hear of a situation where a NHS body has found that it can comply with the Directions and continue to use a 084x number.

(I have advised of this publication in a message published here)

Advice to NHS Bodies 2 - Useful information

Advice to NHS Bodies concerning the cost of telephone calls

2 - Useful information

To support advice being provided with reference to the recently published Directions to NHS bodies concerning the cost of telephone calls, I provide some useful additional general information that may help correct some common false assumptions.

I must urge verification of these comments to be made with Ofcom and all relevant telephone companies.

Contents 

Who sets charges?
What is revenue sharing?
What is "local" rate?
What is a geographic number?
What is premium rate?
Are calls to 084x numbers ever cheaper than calls to geographic numbers?

(Details in support of the final item may be found here)

Who sets charges?

The charge for calling a particular type of number is set by each provider of telephone service as part of their contract with their customer. There is nothing that the body renting the number, nor their telephone service provider, can do to change this. They can only select the type of number that best meets their needs, noting the relevant terms of the tariffs of the various companies providing telephone service to their callers.

Different ranges of non-geographic numbers have different charging characteristics.

• It is only the 03xx range that is subject to charge regulation for all providers. Charges must be no greater than that for calling a geographic number. This covers landlines, mobiles and payphones, extending to the terms associated with pre-paid and "unlimited" packages also.
• BT alone is subject to regulation of its charges for calling all other non-geographic (landline) numbers. Those who choose non-geographic numbers therefore can be assured of what BT will have to charge its customers.
• This control however only covers BT and it has no bearing on which calls are included in any packages, nor on call setup fees. Any influence that BT's rates may have on the market for calls from landlines does not apply to calls from mobiles as BT no longer participates in this market.
• BT is not regulated in its charges for calls to geographic numbers, nor its policy regarding inclusion in packages.
• Barring the perverse effect of the regulation on BT, and the impact this has on the market, one would expect telephone providers to pass the cost of the termination fees incurred on calls to 084x and other ranges, to callers. Indeed, this is generally what is found. In cases where these costs are not carried by callers to the numbers on which the fees are imposed, they will be reflected elsewhere in the overall charging structure.

What is revenue sharing?

Calls to all non-geographic numbers, including all 084x numbers, but excluding all 03xx and in reverse for 080x, are subject to revenue sharing. Part of the revenue earned by the "Originating Communications Provider" (OCP) is shared with the "Terminating Communications Provider" (TCP). This is achieved through the payment of a termination fee between the respective telephone companies. The rate of the termination fee is set (per call minute) according to the number called.

This mechanism is used for calls to mobiles, as addressed by the "Terminate the Rate" campaign. It provides the basis for the provision of Premium Rate Services and operates in the same way, although on a lesser scale, for all 084x numbers.

There is nothing that the caller can do to affect the way this operates. Neither can the call recipient effect any change to the arrangement, after having selected a number from a particular range.

It would normally be seen that where revenue sharing is in effect this would provide a financial benefit to the call recipient and cause a cost to be incurred by the caller.

In the case of Premium Rate Services the benefit is very clear, as it covers the cost of providing the service as well as a profit margin. It is generally assumed that mobile users benefit from the fact that their provider receives income from their incoming calls, so as to enable them to receive incoming calls at a minimal or zero cost. Users of 084x numbers benefit, perhaps in cash payments from incoming calls, but always from the fact that the charge for their service would (all things being equal) be greater were it not for the termination fee payments received by their provider.

The cost to callers is clearly visible in the first two cases. In the latter case there is confusion. Some of this is caused by the effect of the regulation on BT, which denies BT a proper margin when originating these calls, thereby artificially suppressing the relative total charge. As no other provider is subject to this constraint, any suggestion that BT charges are typical, whilst others "may" vary is clearly absurd. In some cases telephone companies fail to reflect the refinement of the many different categories of number, and charge an excessive premium based on the worst case. The fact that there is heavy competition based on the rates for calling geographic numbers tends to force these down, exacerbating the differential.

What is "local" rate?

Historically there was a distinction between the charges for "local" and "national" calls from landlines, although never from mobiles (which cannot have a locality by definition). Whilst the distinction between local and national calls does still exist, since 2004 the vast majority of residential tariffs have offered both at a common rate.

This change is recognised by the ASA and by most trading standards bodies, who have taken action against those using the term "local rate" when describing the cost of telephone calls.

There are a very small number of callers for whom the distinction makes a difference (e.g. subscribers to Kingston Communications, T/A Karoo, in Hull). It is however now generally accepted that the base point to use when referring to the cost of a telephone call is that of a call to a geographic number (Ofcom uses the term "UK rate").

The connection between the charge for calling 0845 numbers and "local rate" was once a key feature of the telephone calls market, but this no longer exists, neither in regulation nor in practice. It sadly remains as a suggestion in the naming of some rates, but this does not imply that the actual connection in charging remains.

The term "lo-call" has been coined to refer to those number ranges which are subject to relatively low premium charges. The phonetic similarity with "local" is perhaps deliberately misleading. This term is now, as it has always been, nothing more than marketing hype.

What is a geographic number?

With the exception of a few such numbers used by Internet Service Providers, a geographic number is any number commencing 01 or 02. Calls to numbers beginning 03 must (by regulation) be charged at the same or a lesser rate. Since the distinction between "local" and "national" rate was abolished, it is the rate for calling a geographic number that represents the base point for UK telephone call charging - a "normal" call.

What is premium rate?

Any rate that includes a premium charge, such as that applied to fund a revenue share, may fairly be referred to as a "premium rate". There is however the danger of confusion with a specific technical term defined in the Communications Act of 2003 - "Premium Rate Service" (PRS).

Those using numbers in ranges deemed by Ofcom as being for PRS are classified as providers of telecommunications services and thereby fall within the terms of special regulations administered on behalf of Ofcom by PhonePay Plus. Ofcom has recently extended the list of number ranges covered by the PRS regulations to include those beginning 0871/2/3.

One must be careful to understand that simply because a number is not classified as being for use in the provision of "Premium Rate Services", calls to it may nonetheless be subject to a "premium rate".

Ofcom will shortly be reviewing the situation regarding 084x numbers. One of many options open to it is to also add some or all of them to those covered by the formal classification of PRS.

Are calls to 084x numbers ever cheaper than calls to geographic numbers?

Every telephone service provider (OCP) must cover the cost of the revenue share incurred when placing calls to 084x number somehow. One would therefore expect such calls to always be more expensive than calls to geographic numbers. Whilst this is generally true, it is not always the case.

BT encourages its customers to subscribe to inclusive packages and markets its call plans on the basis that customers will select a plan to be in effect during the times when they make calls. Cheaper plans are offered for those who do not make calls during the working day or during the working week. Over recent years this has produced two interesting effects in respect of the differential. Both of these derive from the fact the regulation of BT's charges for calls to 084x numbers limit the margin it may take on such calls to deny any profit.

Firstly, BT has been steadily increasing the charge for calling geographic numbers, when outside the period covered by the inclusive package, at the rate of 30% per annum. This has led to the situation where the unregulated rate for calling geographic numbers (outside the terms of a package) has now overtaken even the highest regulated rate for calling 084x numbers. In effect, the penalty premium charge for calling outside the terms of a package exceeds the premium to cover the revenue share.

Secondly, because the rate of the termination fee on 0845 calls is relatively low and BT is limited to the most miniscule margin on these calls anyway, it has been able to make these (but not 0844, on which the termination fee is much greater) calls inclusive in packages whilst only making a relatively modest increase to the cost of the package.

As BT has to make a fair return on its business overall, it is perhaps reasonable to assume that the sharp increases in per minute rates for non-inclusive calls to geographic numbers and the now heavy "call set up fee" of 9.05 pence, which applies to all non-inclusive calls, are effectively cross-subsidising the cost of inclusive 0845 calls and the comparatively cheap rates charged for all 084x calls (0845 when non-inclusive, 0844 is never inclusive).

BT's strong market position in landline call provision has led some others to copy its structure. As their rates for 084x calls are not forced low by regulation, they can only match BT by cross-subsidy.

Details of the which tariffs this does and does not apply to are found here.

Comments

Please advise me if any of the information given above is found to be false or misleading.

David Hickson
Tuesday, 05 January 2010

Advice to NHS Bodies 3 - Telephone tariffs used by NHS Patients

Advice to NHS Bodies concerning the cost of telephone calls

3 - Telephone tariffs used by NHS Patients

The recently issued Directions to NHS bodies concerning the cost of telephone calls requires those bodies to determine whether "persons will not pay more ... than they would to make an equivalent call to a geographic number" if choosing to use a non-geographic telephone number for the delivery of NHS services.

As use of 087x, 09xx and 070x numbers has already been banned, and 03xx numbers are guaranteed to meet this condition by regulation, the point at issue is 084x numbers. As different telephone service providers operate different tariffs the necessary determination of whether "persons will not pay more" can only be made based on the tariffs applicable to those persons - "those to whom the health services are being or may be provided".

It appears therefore that the Department of Health requires NHS bodies to survey all current and potential recipients of their services to discover if a current or proposed 084x telephone number can be retained or newly adopted.

Assistance with resolution of this matter

I follow with three lists that classify a large number of current residential telephone tariffs with respect to the cost of calls to 0845 and 0844 (call type "g6") numbers relative to that for geographic numbers.

For simplicity I refer only to weekday daytime calls, as defined by the respective provider - those taking calls in the evening and weekends will find it less easy to use 084x numbers. As there are 34 different rates associated with the 0844 prefix I use that most commonly adopted - in general the same would be true of most other 0844 rates, however there may be a tiny number of exceptional cases.

The three lists

The first list identifies those on which a caller would pay more to call either a 0845 or 0844 number than an equivalent call to a geographic number.

The second is of those for which this applies to a 0844 but not a 0845 number.

If any "user of health services" could be expected to call under the terms of any one of these tariffs then use of the number must be considered to be prohibited.

The third list is offered for completeness to show the extent of my research and to place claims about the cost of calling 0845 and 0844 numbers in a proper context, as they may relate only to those tariffs. It lists those tariffs on which a caller would pay the same or less to call the 0845 or 0844 number. Those who promote use of 084x numbers are known to quote examples from these tariffs, under the false pretence that they are typical or even universal, to sustain the argument that use of 084x numbers is acceptable.

This would, of course, only be true if all callers were calling under the terms of these packages. I am not sure if it would be proper for an NHS body to urge or advise patients to change their telephone service provider or tariff so that it may comply with Department of Health directions!

Further considerations

The Directions demand consideration of "the arrangement as a whole", so it may be necessary to verify that the classification of tariffs on the second and third list would remain valid for the duration of the contract for supply of telephone service on a 084x number. In this regard it should be noted that Ofcom will shortly be considering whether or not to retain the regulatory control on BT pricing, which is the primary reason for there being any tariffs on these lists.

Given the nature of the principles of the NHS, I am sure that there could be no question of tolerating some patients paying for NHS services because others can gain access at a saving against the normal costs that they would be expected to incur.

Notes are appended below the lists.

List 1 - Telephone tariffs where the cost of a daytime call to a 0845 or 0844 number is greater than that of an equivalent call to a geographic number (see notes and comments).

• BT - Public Payphones
• Virgin Media - Talk Weekends
• Virgin Media - Talk Evenings and Weekends
• Virgin Media - Talk Anytime
• Vodafone - £10 - Contract
• Vodafone - £15 - Contract
• Vodafone - £20 - Contract
• Vodafone - £25 - Contract
• Vodafone - £30 - Contract
• Vodafone - £35 - Contract
• Vodafone - £40 - Contract
• Vodafone - £75 - Contract
• Vodafone - Simply - PAYG
• O2 - Pay Monthly
• O2 - Pay&Go
• Orange - Racoon - PAYG or Contract
• Orange - Dolphin - PAYG or Contract
• Orange - Panther - Contract
• Orange - Monkey - PAYG
• Orange - Canary - PAYG
• Orange - Camel - PAYG
• T-Mobile - Combi - Contract
• T-Mobile - Flext - Contract
• T-Mobile - Solo - Contract
• T-Mobile - PAYG
• 3 - Texter - Contract
• 3 - Internet Texter - Contract
• 3 - Mix & Match - Contract
• 3 - Pay as you go
• Virgin Mobile - Pay Monthly - Contract
• Virgin Mobile - Liberty SIM - Contract
• First: - Anytime
• First: - eve&weekend
• Phone co-op - Evenings & Weekends
• Phone co-op - Pay as you use
• Pipex - Anytime
• Pipex - Saver
• Pipex - Leisure
• Saga - Hourtime
• Saga - Standard
• Sky Talk - Unlimited
• Tesco - HomePhone - Talk 3

List 2 - Telephone tariffs where the cost of a daytime call to a 0844 number is greater than that of an equivalent call to a geographic number, whereas that to a 0845 is the same or less (see notes and comments).

• BT - Calling Plan - Unlimited Anytime Plan
• BT - Calls and Broadband package - Unlimited
• Karoo - KC Talk1
• Karoo - KC Talk2
• Karoo - KC Talk3
• Karoo - KC Talk4
• Talk Talk - UK Evening and Weekend
• Talk Talk - UK Anytime
• Pipex - Hometime
• Pipex - Everytime
• Post Office - Home Phone
• Tesco - HomePhone - Talk 1
• Tesco - HomePhone - Talk 2
• Utility Warehouse - Home Phone

List 3 - Telephone tariffs where the cost of a daytime call to a 0845 or 0844 number is the same as or less than that of an equivalent call a geographic number (see notes and comments).

• BT - Calling Plan - Unlimited Evenings and Weekends Plan
• BT - Calling Plan - UnlimitedWeekends Plan
• BT - Calls and Broadband package - Get Connected
• BT - Calls and Broadband package - Home & away
• BT - BT Basic
• Virgin Mobile - Addict - PAYG

Notes

• The tariffs listed are those currently available and with details published on the internet. Details of previous tariffs and others that may still be in use are not always published. It is imperative that the relevant information be confirmed with the companies listed here. I must urge confirmation of this information with all relevant providers. Published information is often obtuse and difficult to access.
  
• It may also be necessary to consult any other providers of telephone service to patients likely to call any 084x number that may be proposed for use in the provision of NHS services.
• The above classification takes account of the penalty charges applied to landline tariffs when calls are made outside the terms of an inclusive package, which is limited by time and day.
• The classification does not necessarily take account of the fact that some contract mobile tariffs apply a penalty on calls to geographic numbers when the number of inclusive minutes selected has been consumed. This may cause them to cease to be cheaper than calls to 0844 and / or 0845 numbers, under those circumstances. (I believe that this represents a fair approach. One could never be assured that calls to numbers used to provide NHS services would only be made after inclusive minutes had been consumed.)
• There are no business tariffs listed, as NHS services are only available to individuals.
  
• If anyone notices any significant errors in or omissions from any of the lists I would be most grateful to be advised, so that this information may be corrected as necessary.