2025/26 NHS Payment Scheme released in England

On April 4, 2025, NHS England published the final NHS Payment Scheme (NHSPS) for the 2025/26 financial year (starting on April 1st), defining payment mechanisms for the provision of NHS-funded hospital and ambulatory care and some public health services. The previous scheme was set for two years. The NHSPS does not apply to primary care services (e.g., general practice, community pharmacy).

No significant changes were made to the general payment model. As in the previous year, four payment mechanisms apply:

• Aligned payment and incentives (API) remain the key approach, which applies to almost all NHS provider relationships with commissioners - NHS England or Integrated Care Boards. The payment mechanism comprises fixed (global budget) and variable (activity/quality-based) components. Elective care is covered as a variable component using HRG (DRG) tariffs. Non-elective (urgent) care is covered within a fixed component, with HRG tariffs serving as benchmarks. HRG tariffs are published in Annex A prices workbook;
• Low volume activity (LVA) block payments - nationally set values. In 2025/26, it applies to almost all NHS provider/commissioner relationships with an annual value of less than £1.5m;
• Activity-based payments for services delivered by non-NHS providers using HRG tariffs;
• Local payment arrangements - the payment approach is locally determined and applies to activities not covered by another payment mechanism.

Following feedback from the consultation on the 2025/26 NHSPS, it was decided not to introduce the proposed requirement for commissioners to set payment limits for elective services.

The key changes in 2025/26 NHSPS aimed to incentivize moving activity to less intensive healthcare settings:

Reimbursement for activities from Community Diagnostic Centres (CDCs)

• The national CDC programme is now in its third year and has approved 170 CDC sites across England. As described in the Elective Care Reform Plan, CDCs have a vital role in increasing access to diagnostic services, offering patients a wide range of tests closer to home and with a greater choice on where and how they are undertaken;
• Reimbursement was introduced to cover the activities of the CDCs. It applies to endoscopy, diagnostic imaging, physiology examinations, pathology (mostly POC tests), and some other tests;
• Tariffs for CDC activities can be seen in NHSPS Annex A prices workbook, tab 4a;
• Most CDC activities are mapped to existing HRGs. For example:
  • CCE (Colon Capsule Endoscopy) - HRG FE50A “Wireless Capsule Endoscopy, 19 years and over” - £982;
  • Diagnostic Hysteroscopy + Biopsy - HRG MA32Z “Diagnostic Hysteroscopy with Biopsy” - £554.
• Some activities have no relevant HRGs and are mapped directly to reimbursement tariffs (a fee-for-service mechanism). These include in-vitro diagnostic tests, including point-of-care tests (POCT) and certain procedures. For example:
  • Ambulatory BP Monitoring (monitored at home but started in CDC) - £109;
  • POCT EGFR - £20;
  • POCT Pro-BNP test - £36.

A new Best Practice Tariff (BPT)

• One new BPT was introduced, namely Right Procedure Right Place (RPRP), to incentivize moving activity to less intensive healthcare settings in line with the Elective Care Reform Plan;
• RPRP BPT aims to support the movement of suitable procedures from day case (or elective) to outpatient settings in order to drive efficiency and productivity and reduce costs;
• The BPT will apply to certain procedures in dermatology, ophthalmology, orthopedics, Men’s health, and gynecology areas.

No new devices were included in the High Cost Device List (add-on reimbursement). No new products were added to the MedTech Funding Mandate.

See the full details here.

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