The NHS Payment Scheme is a set of rules, prices and guidance that determine how providers of NHS-funded healthcare are paid for the services they provide. It is designed to ensure that funding flows fairly and efficiently across the healthcare system. It does not dictate the total amount of funding available.

The Payment Scheme mainly applies to secondary care services – this includes hospitals, community services, ambulance trusts, and mental health care. It does not cover primary care (GPs, dentists and pharmacies) or public health services like vaccinations. 

The 2025/26 NHS Payment Scheme is currently in effect.

The consultation on proposals for the 2026/27 NHS Payment Scheme is now open until the end of 16 December 2025. All responses to the consultation need to be submitted via the online survey.

Contents

• About the NHS Payment Scheme
• Consultation on amending the 2025/26 NHS Payment Scheme
• 2025/26 pay awards
• Keep informed about payment system development
• Applying for variations
• Nominating changes for the high cost drugs and devices lists
• Join our Futures workspace
• Access to past national tariffs

About the NHS Payment Scheme (NHSPS)

The 2025/26 NHSPS contains rules for four payment mechanisms:

• Aligned payment and incentive (API) – covers almost all NHS provider activity and comprises fixed and variable elements. Almost all elective activity is included in the variable element and paid for using 100% of NHSPS unit prices.
• Low volume activity (LVA) block payments – applies to almost all NHS provider/commissioner relationships with an annual value below £1.5m. Commissioners should pay providers the nationally set LVA value, based on a three-year rolling average, with no other transactions in-year.
• Activity-based payment – applies to all services with NHSPS unit prices delivered by non-NHS providers. Activity is paid for using 100% of NHSPS unit prices for each unit of activity delivered.
• Local payment arrangements – providers and commissioners locally agree an appropriate payment approach.

The NHSPS includes unit and guide prices (published in Annex A). Unit prices are mandated for use in the payment mechanisms above. Guide prices are non-mandatory and support local payment arrangements.

If you have any questions about the NHS Payment Scheme, please contact england.pricingenquiries@nhs.net.

Related resources

• Prescribed specialised services (PSS) manual
• Operational planning and contracting guidance
• NHS Standard Contract

Consultation on amending the 2025/26 NHS Payment Scheme

During the summer of 2025, we consulted on amending the 2025/26 NHS Payment Scheme by changing the prices for ophthalmology services, reducing prices for some cataract services and increasing them for all other ophthalmology services.

Following consideration of the feedback, NHS England has decided not to implement the amended prices during 2025/26. Instead, our consultation on the 2026/27 NHS Payment Scheme includes proposals to make changes to ophthalmology prices.

Contact england.pricingenquiries@nhs.net if you have any questions.

2025/26 pay awards

As set out in the 2025/26 pay award: revenue finance and contracting guidance, the cost uplift factor (CUF) has been updated to reflect the 2025/26 pay awards, increasing from 4.15% to 4.83%.

A set of pay award prices has been calculated using the updated CUF. The prices should be applied from 1 April 2025.

Keep informed about payment system developments

For more information about payment developments, please sign up for updates.

You can also join the Payment system support Futures workspace.

Contact england.pricingenquiries@nhs.net for more information.

Applying for variations

Providers and commissioners can apply for variations to the NHSPS. All applications should use the variations request template and need to be approved by the relevant NHS England regional team(s) before submission to the NHS England national team. Completed and approved templates should be sent to england.pricingenquiries@nhs.net.

Nominating changes to the high cost drugs and devices lists

Within the NHS Payment Scheme, some high cost drugs and devices are excluded from the calculation of unit prices and national prices. Funding for these items is then either included in a fixed payment or paid for in addition to the price for the related service. As medical practice changes and new drugs and devices are developed and adopted, the lists of high cost drugs and devices needs to be kept as current as practically possible.

To nominate a drug or device to be added or removed from the high cost lists, please complete the following form and submit it to england.pricingenquiries@nhs.net.

• High cost drugs and devices submission form

Nominations must be submitted by the end of May before the subsequent year’s Payment Scheme (ie, for nominations to be considered for 2027/28, the completed form needs to be submitted by 31 May 2026). We cannot guarantee that submissions received after that date will be considered until the following year. All submissions received before the deadline will be carefully reviewed and discussed with high cost steering groups.

Join our Futures workspace

Our Payment system support workspace on the Futures collaboration platform contains materials, tools and products to support people to implement the payment system.

Currently the workspace includes:

• ICS Cost Benchmarking Dashboard – a dashboard showing cost and activity data for a whole system, at an ICS level. It allows systems to identify service level spend and patient pathway patterns.
• Costed pathways (supported by GIRFT) – a methodology and worked example for systems to cost patient pathways, highlighting variation from clinical best practice guidelines in activity and costs.

We welcome your feedback on these products, and will continue to develop and update them based on the comments we receive.

Please contact england.pricingenquiries@nhs.net if you have any questions.

Access to past NHS Payment Schemes and national tariffs