The judgment of the Court in Case C-372/04 Yvonne Watts deals with the scope of the EC Treaty provisions on the freedom to provide services and health care provided in a member State other than the one in which the patient resides normally.
The United Kingdom has this amazing national health care system called the National Health Service (NHS). It provides much medical treatment at little or no cost for the patient. Sounds great. Except that a lot of patients never get treated because of the considerable delays.
Mrs Watts, an English lady, suffered from arthritis of the hips and wanted surgery. But she had to wait a year for it in England. She got fed up with waiting (and anyone suffering from bad arthritis will sympathize with her) and wanted to go to France where you pay first, get reimbursed later but don't wait for the treatment. Before going, she applied to the British authorities for reimbursement of the costs she would incur in France. They refused. She challenged the refusal in the English High Court. Her state of health deteriorated so she went to France and had the operation anyway, paying £3,900 ($7,194) and claimed reimbursement from the NHS.
So, the High Court referred a series of questions to the Court of Justice on whether and in what circumstances an NHS patient is entitled under Article 49 EC to receive hospital treatment in another Member State at the expense of that national service.
The Court held that a situation such as Mrs. Watts' in which a person whose state of health requires hospital treatment goes to another member State and pays for treatment falls within the scope of the provisions of the EC Treaty on freedom to provide services. Those provisions of the freedom to receive services apply regardless of the way in which the national system with which that person is registered and from which reimbursement of those services is subsequently sought operates. The Court also held that the system of prior authorization which governs the reimbursement by the NHS of the cost of hospital treatment provided in another member State deters or even prevents patients from applying to providers of hospital services established in another member State and thus constitutes an obstacle to the exercise of the freedom to receive services.
The Court did find that there were circumstances in which the prior authorization system could be justified. But authorization could not be refused on the simple reason that while the waiting lists seemed very long, the treatment was provided free of charge. As a result, the NHS must provide mechanisms for the refund of the cost of hospital care in another member State to patients to whom that service is unable to provide adequate treatment within a reasonable period.
The Court also dealt with a question of interpretation of Regulation No 1408/71 of the Council of June 14th, 1971 on the application of social security schemes to employed persons and their families moving within the Community. It held that under the Regulation the competent institution issues prior authorization for reimbursement of the cost of the treatment provided abroad only if it cannot be provided within the time normally necessary for obtaining the treatment in question in the Member State of residence. But to refuse to grant authorization on the ground of waiting time, the competent institution must establish that the waiting time, arising from objectives relating to the planning and management of the supply of hospital care, does not exceed the period which is acceptable in the light of an objective medical assessment of the clinical needs of the patient.
On a general note dealing with the relationship between national legislation and secondary EC legislation and Treaty law, the Court pointed out that a national measure may be consistent with a provision of secondary EC legislation, (in this case Article 22 of Regulation No 1408/71), but that does not have the effect of removing that measure from the scope of the provisions of the Treaty (see, Case C-158/96 Raymond Kohll v. Union des caisses de maladie at paragraph 25).