The United Kingdom health care system
● Publicly financed
● Largely publicly provided
● Universal coverage for the population with a
zero price at the point of consumption for the
majority of treatment
● Dominated by the public sector
● Relatively small private sector → specializes in
non-emergency surgical procedures .
II. Health Care System ( = HCS )
A. Historical Development
● Comprehensive national health insurance
● NHS = National Health Service
=> Publicly financed and provided, largely from general
● Clinicians did not challenge the government's funding
● In exchange → maintained discretion in the use of
ressources within the fixed global budget .
B . Financing the UK NHS
● Funded largely from general taxation that covers
approximately 86% of the total cost
● National insurance contributions = proportional payroll
taxes to individuals and employers
→ 12% of expenditure and user charges
→ for dental care and prescribed pharmaceuticals
→ finances the remaining 2%
● Dentists now provide only private dental care
● Ophthalmic « privatized » over time
● NHS ressources : fell from 5,3% in 1949 to 0,6% in 1999.
● 1999 , UK spent :
- £61 billion on health care
- £52 billion on the NHS
- £4,4 billion on pharmaceuticals an other products without
C. What is purchased with the expenditures ?
● majority of services by the NHS are free at the point of
delivery → includes access to all hospital and primary
● patients’ access to the health care system tends to be
through the general practitioner ( GP )
● patients can also enter the hospital sector through
accident and emergency departments .
=> GPs provide the majority of primary care services ,
including practice nurses and sometimes other health
professionals such as physiotherapists and counselors
● Individuals pay for some NHS-provided
services ( dentistry and prescriptions )
● Prescription charges = £6.10 / item
Exemption = only 14% of prescriptions are
chargeable and so user charges cover only a
small proportion of overall NHS costs .
● Exempt people : children , the elderly , people
with certain chronic diseases, and people with
low incomes receiving state benefits
● Some prescribed items are exempt : oral
D. How do these expenditures reach the
● Government decides the total size of the UK
NHS budget for each of the four countries .
HCHS = Hospital and Community Health Service.
● Population is weighted by age and other
determinants of the “ need” for health care
● Primary care budget has demand determined
and cash-limited components : it is a function of
the number of general practitioners and their
prescribing behavior .
● Relatively low cost of the NHS = result of tight
control of expenditure by central government ,
in comparison to other HCS .
● Salary systems for remuneration of hospital
doctors reduce the incentives for overtreatment
and supplier-induces demand , which may exist
in fee-for-service systems .
● “ gatekeeper ” system = patients enter the
HCS via their family General Practitioners
(GP) , who care for approximately 90% of all
patient episodes in the community → may keep
overall costs down .
Remuneration of GPs :
- combines a capitation element , a basic practice
allowance and some fee-for-service elements .
- 60% is paid on a capitation basis and additional
payments are also made for individual services .
These additional payments include :
- Target payments for childhood immunizations
- Target payments for cervical cytology
- Additional payments for holding health promotion clinics
- Fee-for-service elements such as payments for minor
surgery and payments for provision of contraceptive
Remuneration of hospital doctors :
- paid on a salary basis , with fixed salary scales .
- majority of consultant also undertake some
private practice , with varying levels of
=> payments for medical examinations or other
requests from individuals , insurance companies ,
employers , which are thought to be outside
normal duties .
- consultants may receive a distinction award ,
paid in addition to their basic NHS salary .
III. The demand for health care : scarcity and
HC demands of individuals , groups, and society
axceed the available resources to fund these
Private HCS → rationing takes place on the basis
of ability to pay => price of health care determines
its allocation .
Waiting list :
- introduced in 1987
- Around 1 million people are on , waiting for
hospital therapy → but priority setting must take
- “urgent” , “soon” , and “routine” indicate priorities
within the waiting list .
=> The numbers of patients on waiting lists in the
UK do , however , attract a great deal of political
and media attention .
In general , doctors feel happier making clinical
rather than economic decisions .
Constraints on public funding in the NHS and the
gap between demand for HC and supply of HC
resources in the UK during 1980s created a public
perception of “underfunding” in the H service and
were the precursors to the radical NHS reforms of