The implications of the European Commission Draft Withdrawal Agreement text for health, part 1: patients and reciprocal healthcare.

Tamara K Hervey, Jean Monnet Professor of EU Law, University of Sheffield

Here is an early analysis of the implications of the European Commission’s draft legal text on the Withdrawal Agreement for some of the people-related aspects of health.

What I am focused on here is patients, and in particular reciprocal healthcare between the UK and the EU-27 post-Brexit. There are two key issues here:

-          The position of UK pensioners who have retired to another EU country, or will do so in the future;

-          The EHIC for emergency care when visiting another EU country, or when people from EU-27 countries visit the UK.

The question of Brexit, health, and ‘people’ of course also includes NHS and social care staffing. In that regard, the key concerns are about the EU-27 and EEA nationals who currently work in the UK’s NHS and social care.  Their position under the Withdrawal Agreement (WA) is the same as that of EU-27/EEA nationals who work in other sectors of the UK economy, and others have analysed their position already.

This is the first time we have had any legal text on withdrawal available for analysis, apart from the proposed clauses on the transitional (or implementation) period, which were analysed here. The text is complex, and like all legal texts, its full implications will take time to emerge. So this is only a first take, and I may well have got things wrong: if you spot anything I’ve missed or misunderstood, please be in touch.

I recognise, of course, that the process of the UK leaving the EU is a negotiation, that this text is yet to be adopted by the EU-27 Council, much less agreed between the EU and the UK, and that ‘nothing is agreed until everything is agreed’. It would be prudent, therefore, for us also to plan for a ‘no-deal’ Brexit, where we leave without any Withdrawal Agreement.

Finally, by way of introduction, I should say that I would love to be able to compare this analysis with the UK’s preferred legal text. Sadly none is currently available. And the Prime Minister’s latest speech, on 2 March 2018, does not cover reciprocal healthcare explicitly at all. There is one of the PM’s ‘five tests’ that is relevant though: ‘reaching an enduring solution’. What follows shows that, should the UK agree to the text as proposed by the European Commission, for at least some aspects of the EU-UK relationship relevant to health, the solution proposed will endure for much longer than some might fear (or hope for).

The timeline:

The text proposes three periods of time, each of which involves different legal rights and obligations:

-          now (while the UK is a Member State of the EU);

-          a transition period (which the UK government calls an ‘implementation’ period), which starts when the WA enters into force on 30 March 2019 (Article 168) and ends on 31 December 2020 (Article 121); and

-          thereafter. 

Whether the precise dates survive the negotiation or not, we are talking about at least three different timeframes, with the associated legal complexity.

It is not going to be easy for people to understand what their rights are, how to enforce them, or what obligations governments (the UK, and those of the EU-27) are under.

I want to suggest in what follows that, implicit in the text of the WA as proposed, is a fourth period of time – quite a long way into the future – where no further rights and obligations apply.

Where we are now:

To grossly oversimplify, patients currently enjoy rights to cross-border healthcare in the EU under four types of EU arrangements: S1 for residents in another EU country; S2 and the Patients Rights Directive for planned care; and EHIC for visitors.  Because access to the UK NHS works on the basis of residence, rather than having paid tax or social security into the UK system per se, EU-27/EEA nationals who meet the NHS ‘ordinary residence’ test in the UK de facto have a set of rights in domestic law too. (NB, the hyperlink is to the rules for England: they are different in Scotland, Wales and Northern Ireland.)

The EU law entitlements essentially work on the basis of coordination of the very different social security systems across the EU. They are part of EU law on free movement of people and EU citizenship, but they do not depend on harmonisation (or ‘regulatory alignment’) of national rules. Indeed the EU Treaties (in Article 168(7) TFEU) rule out such harmonisation, referring to Member States’ responsibilities for “the definition of their health policy and for the organisation and delivery of health services and medical care”, including “the management of health services and medical care and the allocation of the resources assigned to them.” Instead, the EU coordination rules operate to smooth the way for people who cross the EU’s internal borders – to work, to study, to retire, to visit. They protect people from the difficulties that would otherwise arise from the differences in the organisation of social security, and access to benefits, including access to healthcare within national health systems.

One way to think about it is to imagine an EU citizen, and her family, moving around the EU, working and paying into the social security system in each state. As she moves, she accrues a kind of ‘backpack’ full of the benefits they have earned, which she and her family can then put together and call upon if they need them, for instance, when they retire, or if they become too unwell to work, or otherwise unemployed. (That’s called the principle of ‘portability’ and of ‘aggregation’). Another way to think about it is to realise that when an EU citizen is in a different Member State from their ‘home’ Member State (who is responsible for protecting them from the life events that social security systems are there to help with), they are treated as if they were a national of the Member State they are in. (That’s called the principle of non-discrimination.)

Finally, to make sure that people are neither able to ‘double count’ benefits, nor fall through the gaps, for each person there is a single ‘competent state’, which is responsible for paying. That responsibility is irrespective of the country which provides the benefit, or in the case of healthcare, medical treatment. (That’s called the ‘single state rule’.)

So, the British pensioners who have retired to the south of Spain are able to access the Spanish health care system on the basis of the rights they have earned when they worked in the UK. The UK pays for that healthcare; it’s provided by Spain, and it’s provided on the same basis as for Spanish nationals.

All of this is supported – as you might imagine – by a complex set of administrative arrangements, supported by the EU. An Administrative Commission for the Coordination of Social Security Systems is made up of one representative of each of the Member States, plus the European Commission. It deals with administration and interpretation of the rules, and promoting collaboration (Regulation 883/2004, Articles 71 and 72).  In practice, it relies on a network of national competent authorities, which share information so that they can effectively coordinate their activities. There is an Electronic System which supports exchange of social security information. EU data protection law applies here.

Coordination of social security is also an area where there is a great deal of litigation: the rules are complex, and the CJEU is regularly called on to interpret what they mean.

What the Commission text proposes: who is covered?

Just to get this out of the way first. There is – rightly – a huge amount of attention being paid to the scope of the proposed provisions on citizens rights under Title I of Part Two of the draft WA. But what matters for this blog is that who is covered by those provisions is explicitly ‘without prejudice to Title III’ of this Part of the WA, which is on social security systems.

So, if the WA is agreed as proposed, there will be one group of people who have rights to reside (Articles 12-19), to be employed or self-employed (Articles 20, 22-27), and to be treated equally (with some significant exceptions) to nationals (Article 21). There will be a different group of people who have rights under the coordination of social security provisions. One human being might be in both groups.

Again, this will be complex, and it won’t necessarily be easy for people to know what their rights are.

Who will be covered? This is set out in Article 28. The text echoes the text of the key EU Regulation (883/2004), Article 2. The basic idea is to include people who ‘are or have been subject to the legislation of’ either the UK or an EU-27 Member State. The legislation here is the social security legislation covered by Regulation 883/2004. For the avoidance of doubt, Article 28 (3) says ‘ “legislation” means legislation as defined in Regulation 883/2004, Article 1 (l)’. That provision says ‘legislation’ means ‘laws [etc] relating to the social security branches covered by Article 3 (1)’. Those include ‘(a) sickness benefits (ie healthcare); maternity and equivalent paternity benefits; invalidity benefits; old age benefits (ie pensions) … unemployment benefits, and family benefits’. From the point of view of health, the key things that matter are that healthcare is covered, and also that pensions are covered.

Regulation 883/2004 covers EU citizens, stateless persons and refugees, members of their families, and survivors. It also covers nationals of other countries who are not already covered by the Regulation solely because of their nationality. What is important for cross-border health care is that you do not have to be or have been resident in another Member State to your home country to fall within the scope of the Regulation. It is enough that you are ‘subject to the legislation’ of any Member State. Everyone who meets the UK ordinary residence test for access to the NHS, for instance, is ‘subject to the legislation’ of the UK on this matter. Everyone across the EU, including in the UK, who is entitled to an EHIC card is ‘subject to the legislation’.

Unlike the general WA provisions on EU citizenship, which only give rights to those who have exercised their rights to free movement (for instance, by residing in a Member State of which they are not a national), these provisions give rights to everyone who is subject to social security legislation in either the EU27 or the UK.

What the Commission text proposes: what are their rights?

Article 28 (4) secures continued aggregation of rights accrued under periods of social security insurance for EUCs, UK nationals and others, who have worked or resided in an EU Member State or the UK before the end of the transition period.  This is reinforced by Article 29, which says that all the ‘rights and principles’ of Regulation 883/2004, and all the rest of EU social security coordination legislation, ‘shall apply’. It explicitly covers the principles of portability, aggregation, non-discrimination, and prevention of overlapping benefits/single state rule.

The logical consequence of this is that everyone who is within the scope of this part of the WA (ie who has accrued rights before the end of the transition period) will be able to continue to enjoy the rights they currently enjoy in EU law, even after the end of the transition period. It would mean that EU-27 nationals, and others, in the UK, would be able to rely on benefits that they have accrued when working in EU-27 Member States. Of course, they would need to be lawfully resident in the UK, and that is covered by the other parts of the WA.

It would mean that those people within the scope of this part of the WA would be able to continue to rely on the existing routes for planned cross-border healthcare (S2 and the Patients Rights Directive). For instance, UK pensioners in Spain would be able to continue to rely on the S1 system to receive healthcare in Spain. And – crucially for reciprocal healthcare – EU-27 visitors to the UK, and UK nationals when visiting EU-27, and others within the scope of this part of the WA, would be able to continue to rely on their EHIC cards for emergency, unplanned care.

In other words, for everyone who is now within the system of EU coordination of social security, this would continue. All of it.

However, this interpretation doesn’t seem to hold true for cross-border healthcare when we look at the rest of Article 29. For planned healthcare, where someone has begun a course of medical treatment in a Member State other than the one which is ‘competent’, before the end of the transition period, ‘that person shall have the right to continue the treatment until its end’ (Article 29 (4). ‘Until its end’ is presumably intended to include all phases of treatment, including follow up care. The text does not refer to planned healthcare under the Patients’ Rights Directive; only under Regulation 883/2004. And it implies (because otherwise it would not be necessary) that access to planned healthcare that begins after the end of the transition period will not continue.

There is nothing explicit in the text on EHIC healthcare.

But there is something on healthcare for pensioners. It’s in Article 29 (4), which is worth setting out in full.

“If, following the grant of a benefit based on the periods of insurance, employment, self-employment or residence in accordance with Article 28(3) of this Agreement, the United Kingdom becomes competent for the healthcare cover of a Union citizen, or a Union Member State becomes competent for the health care cover of a United Kingdom national, that Union citizen or United Kingdom national shall be entitled to healthcare cover as set out in Articles 24 to 30 of Regulation (EC) No 883/2004 and the corresponding reimbursement procedures shall apply between the United Kingdom and the Member State.”

Let’s unpack that. ‘Healthcare cover set out in Articles 24 to 30 of Regulation 883/2004’ is healthcare cover for pensioners. Essentially the rules are that if someone is entitled to a pension from at least one Member State, they are entitled to receive healthcare in another Member State in which they reside, on the same basis as the residents of that Member State. The costs of the healthcare are borne by the Member State responsible for the pension. This is the basis of the S1 scheme.

The word ‘becomes’ is a bit of a puzzle here. A Member State ‘becomes’ ‘competent for healthcare cover’ of someone whenever they fall within the national rules on who is covered by their national healthcare system. But Article 29 (4) is about when a Member State ‘becomes’ competent for healthcare because of (‘following’) the grant of another benefit – here, pensions.

And, on its face at least, the provision only applies when ‘the United Kingdom becomes competent for the healthcare cover of a Union citizen, or a Union Member State becomes competent for the health care cover of a United Kingdom national’. In other words, it does not cover the situation where a person, having worked in the UK all their life, retires to an EU-27 Member State. The UK has always been competent for that person’s healthcare cover; it hasn’t ‘become’ competent for it.

So Article 29 (4) only seems to deal with people who are in a cross-border situation in the sense that they are EU-27 nationals who move to the UK (and thus fall under the responsibility of the UK’s NHS) or are UK nationals who move to an EU-27 country (ditto and vice versa), and then subsequently retire, and seek health care, as if the EU law that applies now still applied. They would be entitled to the same rights as now. So the EU-27 nationals who come to the UK to work could then retire home, or to another EU Member State, and have healthcare paid for by the UK. And likewise UK nationals who go and work in an EU-27 Member State, and then retire to another EU-27 Member State, or to the UK, would also have healthcare paid for by that EU-27 Member State in which they worked. But Article 29 (4) doesn’t deal with the UK pensioners who have worked all their life in the UK, and then retired to Spain (or another EU country): the biggest group of recipients of cross-border health care who are concerned about the effects of Brexit.

So the question is: which applies – the implications of the general provisions of this part of the draft WA, or the implications of the text of the more specific provisions? In general, a more specific legal provision has priority over a more general one. But given that none of these provisions are explicitly dealing with the two groups of people with which we are most concerned here, and the conclusions I am drawing here are only by implication, it’s not at all clear to my mind what is intended by the draft text.

If the UK wanted to include the UK pensioners who have worked all their life in the UK, and then retired to Spain (or another EU country) within the provisions of this part of the WA, it should seek an amendment or addition to the text. This could be achieved by replacing the word ‘becomes’ and removing the cross-border element of Article 29 (4) as it currently stands. The text would then read:

“If, following the grant of a benefit based on the periods of insurance, employment, self-employment or residence in accordance with Article 28(3) of this Agreement, the United Kingdom or a Union Member State is competent for the healthcare cover of a Union citizen or a United Kingdom national, that Union citizen or United Kingdom national shall be entitled to healthcare cover as set out in Articles 24 to 30 of Regulation (EC) No 883/2004 and the corresponding reimbursement procedures shall apply between the United Kingdom and the Member State.”

If the UK wanted to be clear that the EHIC scheme continues after the end of the transition period, this would probably require a new provision in the WA. As I’ve argued above, Article 29 (1) can be read to imply that EHIC will continue: but if that is what is intended, why not make this explicit? Such a provision should be based on Regulation 883/2004, Article 19 (the source of the EHIC system). An additional Article 29 (5) could read:

“A person referred to in Article 28 of this Agreement, and the members of his/her family staying in a Union Member State or the United Kingdom shall be entitled to the benefits in kind which become necessary on medical grounds during their stay, taking into account the nature of the benefits and the expected length of the stay. These benefits shall be provided on behalf of the competent institution by the institution of the place of stay, in accordance with the legislation it applies, as though the persons concerned were insured under the said legislation.”

And if the UK (and the EU) want EHIC to continue, there is no reason not to continue with reciprocal arrangements on planned healthcare too. After all, under Regulation 883/2004 planned healthcare can only happen with the authorisation of the Member State which pays: the UK (along with every Member State) has always had control over this aspect of reciprocal healthcare in EU law. So Article 29 (3) would also need to be amended, to remove the words ‘before the end of the transitional period’.

What the Commission text proposes: the time frame

Most of the provisions in the WA have a tight temporal limitation: they cease at the end of the transition/implementation period. This is not so for the social security coordination provisions as proposed by the European Commission.

On the contrary, none of the Title seems to have any specific temporal element to it. Article 29 (2) says ‘contributions both before and after the end of the transition period’ and ‘rights flowing from such periods’ shall be aggregated. So this Title continues the coordination of social security systems between the UK and the EU for those people who fall within its personal scope in perpetuity - indeed as Article 35 explicitly says, for the lifetime of the person covered.

This is a very long time, if you consider that the personal scope of this Title includes not only everyone who falls within Regulation 883/2004 at the time the WA comes into effect, but also their survivors (widowers and widows) and their families. The last person to enjoy rights under this part of the WA will be the person who within its scope who lives the longest. That could be someone who just enters the workforce, or the baby last born to someone within the scope of this part of the WA, at the time the WA comes into force.

What the Commission text proposes: administrative and dispute settlement arrangements

The general rule in the proposed WA is that the UK will cease to participate in EU administrative bodies, committees or expert groups, from the start of the transition/implementation period, ‘unless otherwise provided in this Agreement’ (Article 6). But there is an explicit exception for the coordination of social security systems (Article 30).

Likewise, in general, UK access to EU databases, systems and networks ‘established on the basis of Union law’ (which includes the systems supporting coordination of social security) will cease at the end of the transition period. But the proposed WA makes an exception for those systems (Article 30). UK processing of personal data, both during and after transition/implementation must be in conformity with EU law (Article 67). That will cover data processing under coordination of social security.

The proposal is that administrative cooperation between the EU and the UK on the coordination of social security continues.  The UK will continue to bear its share of costs of the electronic system for exchange of social security information (Article 30 (2)). However, the UK will be an ‘observer’ in the Administrative Commission, rather than a full member (Article 30 (1)).

In terms of dispute settlement – and bear in mind that EU social security coordination involves a great deal of litigation – the proposal is that the CJEU will continue with its jurisdiction, including to hear preliminary references on interpretation of EU law, throughout transition/implementation (Article 82). CJEU cases decided during this period ‘shall have binding force in their entirely on and in the UK’ (Article 85). The CJEU would have jurisdiction over the WA in general during this period (Article 126). After this point, it would have more limited jurisdiction over citizens’ rights issues arising in the UK (including social security aspects) for eight years after the end of the transition/implementation period (Article 151), and its jurisdiction over the WA as regards UK citizens in the EU27 would continue indefinitely. It would also have jurisdiction relating to disputes on interpretation of the WA indefinitely (Article 162), if those disputes could not be settled politically. If the interpretation above is correct, and the temporal reach of this part of the WA is long after transition, this will mean oversight by the CJEU of one part of the EU-UK relationship well into the future. Furthermore, the powers of the independent authority tasked to help enforce the WA as regards EU citizens in the UK would continue indefinitely too (Article 152).

Summary and key implications

There are two key issues that people concerned about Brexit and cross-border healthcare want to resolve:

-          The position of UK pensioners who have retired to another EU country, or will do so in the future;

-          The EHIC for emergency care when visiting another EU country, or when people from EU-27 countries visit the UK.

The proposed legal text on the WA does not deal explicitly with either of these. By implication, some of its provisions can be read to guarantee existing EU law rights well into the future: for the lifetime of anyone who holds such a right at the end of the transition period.  But other provisions can be read to imply the opposite.

Whichever is the case, the proposal is to continue cooperation between the EU and UK over coordination of social security systems (though with the UK in an observer position), and oversight of the CJEU, well into the future, and certainly long beyond the end of the transition period.

Whether this lack of ‘taking back control’ is a price worth paying for the UK should depend on a range of considerations.  The Department of Health and Social Care should play a key role in making that determination; and parliamentary oversight of such decisions should be without question. The Lords EU Home Affairs Sub-Committee will report soon in its Brexit: Reciprocal Healthcare Inquiry. The Commons EU Scrutiny Committee has already suggested incorporating Regulation 883/2004 (with suitable amendments) into the WA. It warned that ‘no deal’ would have potentially devastating effects on the lives of many, particularly vulnerable people. This point was also noted by the Commons Health Committee, which concluded (paras 125-6):

“Far from being a drain on the public purse, the provision of care to UK insured persons in the 27 other member states represents excellent value to the British taxpayer. Moreover citizens across the EU can readily access vitally important, high quality healthcare without encountering financial or bureaucratic barriers. Just as this allows someone from the EU to work in the UK, it enables a British pensioner to retire to France, Spain or Italy.

It is in the interest of many hundreds of thousands of British people living across the EU to maintain simple and comprehensive reciprocal healthcare arrangements. The Government’s negotiating objective should be preservation of the existing system of reciprocal healthcare so that EU nationals in the UK and people insured by the UK in other EU countries can maintain their access to healthcare.”

Barnard & Peers: chapter 21, chapter 27

Photo credit: Daily Mirror