History of the UK Healthcare

A Civilized Society:

A Presentation of the United Kingdom’s Health Care System

Jean-Paul Puryear

Candace P. Forbes

Heath M. Perry

University of Texas at Tyler

1

Running head: A CIVILIZED SOCIETY

2

A CIVILIZED SOCIETY

Abstract

Executive Summary

Introduction

“No society can legitimately be called itself civilized if a sick person is denied medical because of a lack of means.” Aneurin Bevan

Background of Health Insurance in the United Kingdom

History of UK Healthcare

National Health Service

Population Coverage

Challenges

Future

Health Care Infrastructure

Aneurin Beven, the former miner who became a politician and the then Minister of Health, launched the NHS on July 5, 1948 in response to the aftermath of World War II. It was introduced to the British Parliament in the 1942 Beveridge Report on Social Insurance and Allied Services.

Social Philosophy and Vision

The NHS was made out of the archetype that healthcare should be available to everyone regardless of wealth. The NHS was founded under the principles of universality and based on three core principles: that it meets the needs of everyone, that it be free at the point of delivery, and that it be based on clinical need, not ability to pay. It was the first health system in any Western society to offer free medical care to the entire population. Furthermore, the NHS was the first comprehensive system to not be based on the insurance principle, with entitlement following contributions, but rather on the national provision of services available to everyone (Delamothe, 2008). Despite numerous political and organizational changes the NHS remains to date a service available universally that cares for people on the basis of need and not ability to pay, and which is funded by taxes and national insurance contributions.

While healthcare is “free” to British citizens at the point of delivery, it is certainly not “free”. The NHS is primarily funded from general taxation on its citizens and supplemented by National Insurance Contributions. Additionally, patients contribute toward the cost of selected services with exemptions in place for those under 16 years and over 60 years. Mental health services are also free but patients need a referral from their general practitioner to access most services. Exceptions for the referral requirement exist for drug and alcohol services as well as some psychological services. Furthermore, health care and social care are funded separately under the NHS.

Finance

Approximately 80.0 percent of funding for the NHS is derived from general taxation. National Insurance accounts for about 18.0 percent, which leaves 1.2 percent coming from user charges (The Kings Fund, 2017). Charges to the patient for prescriptions, dental treatments and eyeglasses account for this small proportion of NHS income. Interestingly, the NHS allows hospitals to charge inpatients for non-clinical services that do not affect health outcomes like the use of bedside entertainment systems. Additionally, the NHS charges for parking and land sales to help generate more income for the program. The level of NHS funding is set by the government through the Spending Review process which estimate how much income the NHS will receive from sources. If those sources raise less funding for the NHS than budgeted, funds from general taxation are used to ensure the appropriate level of funding is allocated. Private health insurance policies, most of which are employer-sponsored corporate subscriptions, are held by 10.6 percent of the population (McKenna, Dunn, Northern, & Buckley, 2017).

Even amidst a slowdown in funding, the UK is currently a relatively low spender on healthcare by many international comparisons. Applebee (2016) illustrates that “in 2000, current spending on healthcare in the UK was 6.3 percent of GDP and the ten Prime Minister Tony Blair committed his government to matching the average for health spending as a percentage of GDP in the 14 other countries of the European Union through increases in NHS spending.” Applebee (2016) further notes that “in 2013, the UK spent 8.5 percent of its GDP on public and private healthcare. This place the UK 13th out of the original 15 countries of the EU and 1.7 percent lower than the EU-14’ level of 10.1 percent of GDP.”

Applebee states that Prime Minster Blair’s commitment was to not only keep up with the other EU nations but “emphasized that spending more on health care was affordable.”

The relative contributions from each of these sources of finance – general taxation, National Insurance, and user charges – has fluctuated over the years (McKenna et al. 2017). Currently, the NHS is experiencing the longest and most severe slowdown in funding in its history which has raised questions about the sustainability of its funding model. As inflation of healthcare costs continue to rise over time, health services are consuming an increasing proportion of public spending. Governments can either divert monies from other areas of public spending or raise taxes. Both options constitute a high profile in politics and can be relatively unpopular decisions in an economic downturn. While this introduces a degree of accountability, this method can make budgets unpredictable from year to year.

Role of Government

Parliament, the Secretary of State for Health, and the Department of Health is responsible for policy making and any legislation that affect health care in England. In accordance with the Health Act of 2006, the Secretary of State has overall responsibility for the work of the Department of Health whom is responsible for strategic leadership and funding for both health and social care in the United Kingdom. The Department of Health is a parliamentary department, supported by twenty-three agencies and public bodies (National Health Service, 2016). Rights for those eligible for National Health Service (NHS) care are summarized in the NHS Constitution. The Department of Health provides guidance for the overall health care system, but day-to-day responsibility for running the NHS rests with a distinct public body called NHS England. NHS England is an autonomous body. Its mission of NHS England is to set the priorities and direction of the NHS. NHS England is the chief administrator for primary care services such as General Practitioners (GP), pharmacists and dentists, including military health services and some specialized services.

NHS England manages around £100 billion ($138.1 billion) of the NHS budget and ensures organizations are spending the budgeted funds effectively. Resources are allocated to Clinical Commissioning Groups, also known as CCGs (National Health Service, 2016). NHS England manages the budget, supervises 209 local CCGs and ensures that the objectives set out in an annual mandate by the Secretary of State for Health are met, including both efficiency and health goals according to the National Health Service (2016). Budgets for public health are held by local government authorities, which are required to host ‘health and well-being boards’ to improve coordination of local services and reduce health disparities (The Commonwealth Fund, 2017). The CCGs are clinically led statutory NHS bodies responsible for the planning and commissioning of healthcare services for their local area. CCG members include GPs and other clinicians, such as nurses and consultants. They are responsible for about 60% of the NHS budget according to The Commonwealth Fund (2017). The CCGs commission most secondary care services, are integral to the commissioning of GP services. CCGs have the authority to commission any provider that meets both NHS standards and costs. These providers can be hospitals, social enterprises, charities or private sector providers.  Both NHS England and CCGs have a duty to involve their patients, careers and the public in decisions about the services they commission.