Key Facts & Summary
- The National Insurance Act of 1911 formed the basis of health insurance in Britain and the UK.
- England was not the first European country to introduce health insurance. Germany had already introduced it by the time the National Act was being passed.
- It was mainly championed by the Liberal party of England.
Social Security in the United Kingdom was largely administered by the central government and is commonly called National Insurance. Some powers have been transferred since 1999 to decentralized governments1: the Scottish Government, the Welsh Government, and the Northern Ireland Executive.
National Insurance was financed by social contributions (salary and employer). It manages allowances, pensions and unemployment benefits.
National Insurance has its origins with the creation in 1911 of two systems: Health and pensions: managed by unions and approved funds
After the Second World War, the government of Clement Attlee extended the system while nationalizing it. With the creation of the Ministry of National Insurance, the management of the system passed to the State.
Liberal Party (United Kingdom)
Heir to the Whigs, the Liberal Party embodies classical liberalism in the United Kingdom: a supporter of laissez-faire, free trade, social reform, and individual liberties by reducing the powers of the Crown and the Anglican Church and the extension of the right to vote. But after 1885 the party began to favor the rise of the role of the state: we speak of “modern”, “progressive” or “new” liberalism. This “new” liberalism becomes “social liberalism” which tends to require the intervention of the state to ensure a minimum of social security. The welfare state was born with the government of Herbert Henry Asquith and David Lloyd George in the 1900s. Lloyd George even adopted a Keynesian program in 1929, when the party declines in the face of the rise of the Labour Party. The party will die out gradually after the Second World War.
The Liberal Party name appeared in 1839 with Lord John Russell, but it was a coalition of Whigs in the House of Lords and Radicals in the Commons. This radical current represents the industrial cities now represented with Richard Cobden, among others. His recruitment is, therefore, less aristocratic and more urban than that of the conservative party. From the religious point of view, he has the support of the non-conformists and the less dogmatic tendencies of the Anglican Church. Free trade will be the cement and the only point common to all Liberals. Until the First World War, liberals and conservatives regularly alternate in power.
The party was officially born with the formation of Lord Palmerston’s second government (1859). He joined some of the free-trade conservatives, the Peelites whose dominant figure is William Gladstone. The latter will become the first leader of the new party because of the death of Palmerston (1865) and the withdrawal of Lord John Russell (1868). For thirty years, Gladstone and liberalism will be synonymous terms. Gladstone made important reforms in England and Ireland, fully established free trade, pursued a peaceful policy, and endeavored to limit colonial expansion. The Irish question divides the party in 1885: the Unionists separate led by Joseph Chamberlain and get closer to the conservatives.
After the withdrawal of Gladstone (1894), the party declines and tears itself during the Second Boer War. The elections of 1906 nonetheless mark their greatest electoral triumph. The government of Sir Henry Campbell-Bannerman is dominated by the brilliant figures of Herbert Henry Asquith, Edward Gray, Richard Burdon Haldane, and David Lloyd George. Important socially inspired reforms undertaken following the “budget people” proposed by Lloyd George in 1909. After reducing the powers of the House of Lords (1911), they develop the insurance system against disease and unemployment (National insurance Act of 1911), set a minimum wage (1912) and are adopting a draft Irish Home Rule (1913), but fail to apply in time to avoid the 1916 Easter uprising.
The Great War challenges the beliefs of Liberal Party leaders who must carry out anti-liberal policies. By 1915, the Conservatives were associated with power and the party was torn apart again. The liberal-conservative coalition led by David Lloyd George further contributes to weakening the party. Partisans of Asquith and supporters of Lloyd George clashing undermining the unity of the party. In 1922, the Labor Party supplanted it as an opposition party on the left and tried to eliminate it. In the elections of 1935, the party has only 17 elected in the Commons and only six in 1951. The small liberal party supports entry into the EEC in the 1960s.
They are similar in the 1980s the Social Democratic Party founded by dissident Labor which will give birth in 1988 to a new party that takes the name of Liberal Democratic Party even if a liberal party still exists (1989) but with an influence reduced and purely local.
UK Health Insurance: Adding the State Social Security System and Private Health Insurance
The National Insurance Act of 1911 introduced a statutory and compulsory system to supplement the services offered by Friendly Societies, which continued to provide insurance coverage. to workers not covered by the 1911 Act.
In 1948, despite the opposition of certain categories of medical professions, the “National Health Service”, to which all residents can resort. It offers free of charge for patients general medical care, dental and eye care, specialist care in state hospitals, as well as medico-social services such as home care, ambulance transportation etc.
The NHS, which absorbs in the mid-1990s, about 40 billion pounds a year, derives 83% of its income from tax, 13% from the NHS share of contributions paid by employees, employers and the self-employed and 3% of the direct payment by the patients.
Several private insurance policies offered to the British:
– “medical expenses insurance” which covers medical expenses and includes the guarantees granted by the “Hospital Contributory Schemes”, more than a century old, which are non-profit entities (29 in total) financing of local private hospital facilities, as well as the benefits paid by the “Hospital Cash Plans”, which are insurance offered by 16 institutions (ie “Provident Associations”, that is to say, mutual benefit societies, or insurance companies) and whose object is the payment of lump-sum benefits during the periods of hospitalization (this insurance is taken out either for the benefit of the employees, or individually by 11% of the population and is practiced by the ” Provident Associations “or insurance companies);
The “Permanent Health Insurance” (long-term incapacity insurance) which covers the loss of income resulting from a long-term sickness or incapacity for work, proposed for a century by two insurance companies as well as by “Friendly Societies” (the total number of organizations promoting this insurance increased from 400 before 1948 to 30 after the creation of the all of which are now an integral part of the private health insurance sector);
Individual accident insurance which covers the loss of income following a short-term sickness or incapacity for work;
Critical illness insurance (“Critical illness”), which provides for the payment of a lump sum payment in the event of the diagnosis of certain serious diseases. The demand for private insurance, far from diminishing after the creation of the NHS, has grown steadily for fifty years.
Private medical insurance premiums vary according to the age and statistics of all individual contracts in the industry. As a result, they are calculated according to the size and cost of claims recorded for the entire community. Premiums increase with the age of the insured. The majority of insurers ask their future clients to complete a form of their medical history, which is carefully studied by the insurer. When they do not request a “history form”, this document is replaced by a moratorium indicating the care previously received by the applicant, who can not, therefore, receive benefits for treatment directly or indirectly related to his medical history (except at the end of a period of two consecutive years in principle).
A significant number of insured persons continue to occasionally use NHS partial care. About 15% of private sector patients are not covered by insurance and pay the full costs themselves.
Constrained since its inception by problems of financing and modernization of equipment, the NHS, which provides services of high quality, has been led to establish waiting lists. More than one million people wait on average for a period that can be several months. It was extensively reformed in the early 1990s: the functions of buyer and seller of medical services were dissociated to allow more efficient management.