View original document

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

U. S. DEPARTM ENT OF LABOR

JAMES J. DAVIS, Secretary

BUREAU OF LABOR STATISTICS
ETHELBERT STEWART, Commissioner

BULLETIN OF THE UNITED STATES \
BUREAU OF LABOR STATISTICS/

No. 312

W O R K M E N ’ S I N S U R A N C E AND C O M P E N S A T I O N S E R I E S

NATIONAL HEALTH INSURANCE
IN GREAT BRITAIN, 1911 TO 1921




By HENRY J. HARRIS

APRIL, 1923

WASHINGTON
GOVERNMENT PRINTING OFFICE
1923




ADDITIONAL COPIES
OF THIS PUBLICATION M AT B E PROCURED FROM
TH E SUPERINTENDENT OF DOCUMENTS
GOVERNMENT PRINTING OFFICE
WASHINGTON, D . C.
*
AT

15 CENTS PER COPY

PURCHASER AGREES NOT TO RESELL OR DISTRIBUTE THIS
COPY FOR PROFIT.— PU B . R ES. 57, APPROVED MAY 11, 1922.

CONTENTS.

Page.

Introduction............................................................................................................................ 1-4
Summary statement of the system................................................................................... 4-12
Persons included......................................................................................................................12-14
Compulsory insurance......................................................... ..........- ............................12,13
Voluntary insurance..................................................................................................... 13,14
Deposit contributors..................................................................................................... 14
Dependents of insured persons.........................................................................
14
14
Persons granted exemption from compulsory insurance...................................
Industries and employments included............................................................................ 14,15
Disability provided for........................................................................................................ 15,16
Benefits..................................................................................................................................... 16-35
Medical benefit.................................................................................................................16-20
Qualifications.......................................................................................................... 16
General arrangements for medical service......................................................16,17
Allocation................................................................................................................ 17,18
Drugs and appliances...........................................................................................18,19
Kind of treatment provided............................................................................... 19
Certification...............................................................................................................19,20
Sanatorium benefit..........................................................................................................20-24
Prior to 1921.......................................................................................................... 20,21
After 1921................................................................................................................. 21-23
Finances of the sanatorium benefit........................................................... .. 23,24
Sickness benefit............................................................................................................... 24-28
Qualifications............................................................................................................24,25
Rates of benefit........................................................................................................ 25,26
Benefits while in arrears of contribution........................................................26,27
Behavior during sickness.................................................................................... 27,28
Disablement benefit...................................................................................... . . .
29
Qualifications......................................................................................... - - ............ 29
Rate of benefit..................................: ................................................................... 29
Maternity benefit.............................................................................................................29-32
General features....................................................................................................... 29,30
Waiting (or probationary) period and other qualifications........................30,31
Rate of benefit..........................................................................................................31, 32
Additional benefits..........................................................................................................32, 33
Miscellaneous benefit features......................................................................................33-35
Mercantile marine................................................................................................. 33
Married women......................................................................................................
34
T h e‘‘free year’s ” benefit................................................................................... 34
Inmates of institutions.........................................................................................34,35
Sources of income....................................................................................................................35-38
Government grants........................................................................................................ 35
Contributions.................................................................................................................... 36, 37
Ordinary rate.......................................................................................................... 36
Low-wage earners..................................................................................................
36
36
Weekly rates for low-wage earners prior to July 5, 1920.........................
Mercantile marine................................................................................................. 37
Special groups........................................................................................................
37
Arrears.................................................................................................................................37,38
Financial administration..................................................................................................... 38-53
Actuarial basis of the system........................................................................................38-40
Reserve values. ............................................................................................................... 40, 41
The contingencies fund..................................................................................................41,42
The central fund..............................................................................................................42,43
The women’s equalization fund.................................................................................. 43,44
The value of the benefits...............................................................................................44-46
Reserve suspense fund................................................................................................. 46
The actuarial valuation.........................................
46-53
Disposition of the surplus................................................................................
52
Amount of additional benefits........................................................................
52
Deficiencies^...................................................................
53




in

IV

CONTENTS.

General administration......................................................................
Ministry of Health..................... ................................................
National health insurance joint committee.........................
Consultative councils.................................................................
Insurance committees................................................................
Income of committees.......................................................
Approved societies. . . , ..............................................................
Membership......................................................................
Types of societies...............................................................
Transfers between societies............................................
Associations of societies.............................................................
The deposit contributors’ fund...............................................
Excessive sickness......................................................................
Operations of the system ..................................................................
Sources of information...............................................................
Number of persons insured......................................................
- Expenditure for pecuniary benefits......................................
Sanatorium benefit.....................................................................
Financial operations...................................................................
Summary of receipts and expenditures........................
Reserves on March 31,1920.............................................
Income in 1920...................................................................
National health insurance fund......................................
Ministry of Health..............................................................
Staff of insurance department.........................................
National health insurance joint committee.................
Receipts and expenditures of approved societies__
Receipts and expenditures of insurance committees.
Statistics of sickness..................................... ..........................
Operations of typical individual carriers.............................
Friendly societies................................................................
Establishment fund............................................................
Industrial assurance society.............................................
Association of small societies...........................................
Bibliography on national health insurance in Great Britain.




Page.

53-63
54.55
55
55.56
56-58
57,58
58-61
59.60
60.61
61
61, 62
62
63
63-95
63.64
64.65
65-68
68-74
74-88
74-76
76
77,78
78-81
81,82
82,83
83
84-86
87.88
88.89
89-95
89-91
91,92
93-95
96-103
q k

BULLETIN OF THE

U. S. BUREAU OF LABOR STATISTICS
NO. 312

WASHINGTON

NATIONAL HEALTH IN SU RAN CE IN
1911 TO 1921.

APRIL, 1923

GREAT BRITAIN ,

INTRODUCTION.

Great Britain placed in operation a compulsory system of health
and invalidity insurance in tne year 1912, when tne act of December
16, 1911* came into force. This sharp break with the traditional
policy of the Government of that country was made, according to
one critic, with dramatic suddenness, though also “with almost uni­
versal consent.”
The reasons for the introduction of the system came out fully in
the debates in Parliament on the bill. Emphasis was placed on the
fact that sickness was the cause of poverty to a large extent; a promi­
nent Government official had said that 30 per pent of the pauperism
was due to sickness; that pauperism was a serious problem had been
demonstrated by the old age pension law of 1906. This act had
revealed a mass of destitution and suffering in the age period 70 years
and over, and the same condition undoubtedly existed for the ages
prior to 70.
Considerable provision had already been made against distress
due to death, sickness, and unemployment. There was hardly a
household in the country where there was not some form of insurance
against death, which had always been one of the main activities of
the mutual and commercial organizations for providing insurance.
The plan for State insurance, therefore, omitted any burial benefits.
There was also a widespread system of provision against distress
due to sickness by the voluntary organizations; there were perhaps
between six and seven million persons who had secured- such pro­
vision, but most of it was inadequate, and, worst of all, it was fre­
quently allowed to lapse, mostly for reasons beyond the control of the
wage earner. In very many cases the purchase of such insurance
was beyond the means of the wage earner, and in 1911 it was esti­
mated that only about one-half of them were in possession of such
protection.
It was estimated at the time that there would be about 9,200,000
men and 3,900,000 women who would be subject to the health in­
surance system. The actual experience later showed that these
estimates were approximately correct, as the number of men insured
in 1914 was about 9,680,000 and the number of women was about
4,077,000, or a total of about 13,757,000. As shown in the table
following, the number of occupied persons over 10 years of age in
England and Wales in 1911 was about 16,300,000; since 85 per cent



1

2

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

of the insured population is resident in these two countries, a com­
parison of the occupied with the insured population will give a fair
idea of the extent of the insurance. The number of insured persons
in England and Wales in 1913 was about 11,211,000; this number is
about 70 per cent of the persons engaged in occupations in 1911.
At the time the insurance bill was placed before Parliament the
total population of England and Wales was 45,221,615; the number
of persons 10 years of age or over who were reported by the 1911
census as having an occupation was 16,286,919. The following
table shows the data for 1911 and the three preceding censuses:

NUMBER OF OCCUPIED AND OF UNOCCUPIED PERSONS 10 YEARS OF AGE AND OVER
IN ENGLAND AND WALES AND PROPORTION IN EACH CLASS, 1881,1891,1901, AND 1911.
[Source: Census of England and Wales, 1911. Vol. X, Part 1, London, 1914. Cd. 7018. Pp. 552, 553;
Statistical abstract for the United Kingdom, 65th number. London, 1919. Cmd. 491. P. 383.]
Year.
Number:
1881.......................................................
1891.......................................................
1901.......................................................
1911.......................................................
Proportion per million of population 10
years of age and over:,
1881.......................................................
1891.....................*.................................
1901.......................................................
1911............................ :........................

Total occupied Retired or
and
unoccupied. unoccupied.

Total
Engaged in population of
occupations. United King­
dom.

19,306,179
22,053,857
25,323,844
28,519,313

8,144,463
9,301,862
10,995,117
12,232,394

11,161,716
12,751,995
14,328,727
16,286,919

1,000,000
1,000,000
1,000,000
1,000,000

421,858
421,779
434,180
428,916

578,142
578,221
565,820
571,084

34,884,848
37,732,922
41,458,721
45,221*615

According to these returns, about 57 per cent of the population 10
years of age and over were gainfully employed at the time the re­
spective census figures were collected, the proportion showing a
slight decrease in the last two censuses as compared with the earner
censuses.
The principal occupations in which these persons in the gainfully
employed population were engaged in 1911 were the following:
PRINCIPAL OCCUPATIONS, ENGLAND AND WALES, 1911.
[Source: Census of England and Wales, 1911, Vol. X, Occupations and Industries. Part I, London, 1914.
Cd. 7018. P .5 .]
Industry or service.

Net total in industry or
service.

Number classified in occupa­
tion census.

Males. Females. Total.

Males. Females. Total.

Domestic indoor service................................ 41,765
Agriculture (on farms, woods, and gardens) 1,134,714
Coalmining..................................................... 968,051
Building.......................................................... 814,989
Cotton manufacture................. . ................... 250,991
Local government (including police and
poor-law services)....................................... 412,501
Railway companies’ service......................... 535,799
Engineering and machine making, iron
founding and boiler making..................... 502,942
Dressmaking.................................................... 3,826
Teaching.......................................................... 89,648
Inn, hotel service........................................... 178,550
Grocery......................... .................................. 210,387
Tailoring..................... ..................................... 127,301
Printing, bookbinding, and stationery — 161,856
National Government.................................... 215,110
Woolen and worsted manufacture.............. 105,552
Boot, shoe, etc., making................................ 172,000
Drapery........................................................... 93,171




1,260,673
94,841
3,185
2,953
372,834
176,450
7,170
7,284
333,129
211,183
110,506
58,935
127,527
87,609
34,089
127,637
45,986
110,955

1,302,438
1,229,555
971,236
817,942
623,825
588,951
542,969
510,226
336,955
300,831
289,056
269,322
254,828
249,465
249,199
233,189
217,986
204,126

54,260
1,140,515
884,530
872,963
233,380
107,810
397,990
516,353
2,815
76,428
156,389
165,981
132,352
155.170
140,814
95,531
169.171
66,362

1,335,358 1,389,618
94,722 1,235,237
2,856 887,386
572 873,535
371,797 605,177
19,437 127,247
2,636 400,626
4,571 520,924
339,240 342,055
187,283 263,711
89,497 245,886
53,638 219,619
127,115 249,467
89,680 244,850
31,538 172,352
127,148 222,679
44,523 213,694
84,606 150,968

INTRODUCTION.

s

The foregoing table shows, first, the total number of persons
employed in each of the industries having more than 200,000 persons
employed in th&n and, second, the number for which occupational
details were reported.

These data snow that the country has a wide variety of industries,
including agriculture, mining, construction, manufacturing, and com­
merce, and also that the professions, such as teaching, are well repre­
sented.

One problem in providing a system of health insurance for this
population was to decide whether it should be organized by industries
or by other groups. The German plan was to use the industry as a
principal basis of organization, but as early as 1908 the leader of the
Government had said in the House of Commons that the German
plan was unsuited to British needs; by disregarding the occupational
or industrial lines it was believed that a solution could be found
which would appeal more strongly to the traditional individualism of
the British wage earners.
The plan adopted made use of a wide variety of existing voluntary
organizations as carriers, some of which were based on occupational
lines, but the greater part consisted of a membership selected without
regard to industry or occupation.
These societies had used a contributory system of insurance, and
this helped to make the operation of the system easier, as the ma­
chinery of collecting contributions was already in existence or
familiar to most of the persons to be insured. During the discussions
on the bill the suggestion was made that the State should bear the
entire cost of the insurance, as was the case with the old-age pension
system. It was easy to prove that the amount necessary to cover
the cost of such a plan was so heavy that the question practically
resolved itself into deciding in favor of a contributory system or
of having no State insurance at all.

From the very start it was recognized that the plan would have to
be modified from time to time to adjust it to conditions not foreseen
when the plan was prepared, or to improve it as experience showed
the necessity for such change. The principal amending laws have
been those of 1913, 1918, ana 1920. The first two of these provided
for simplifying the administration and correcting certain abuses; the
1920 amending act increased the contributions and benefits and pro­
vided for the eventual transfer of the sanatorium (tuberculosis)
benefit to a new service in order to supply a more comprehensive
course of treatment. Since the establishment of the system, two
investigating committees have made exhaustive surveys of its work­
ings. It is interesting to note that these committees, composed of
members of different parties and representing different points of view,
all seem to join in stating that the actual working of the plan was of
distinct value to the persons insured. All of their recommendations
were in the direction of extending and improving the system. The
only change which has the appearance of lack of success in the system
is the removal of the sanatorium benefit. The author of this change,
the first minister of health, has stated that it was made for the pur­
pose of introducing a nation-wide, intensive system of treatment
which would be beyond the scope of a health insurance system.




4

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

The history of health insurance in Great Britain is in some detail in
the twenty-fourth annual report of the United States Commissioner of
Labor, in which the latest information given is for the year 1909.
It is now known that the British Government at that time had its
experts at work preparing plans for the system here described* and
the present report therefore may be said to take up the subject where
the former study ceased.
SUMMARY STATEMENT OF THE SYSTEM.

By the act of December 16, 1911, which came into operation on
July 15, 1912, a system of compulsory health and invalidity insurance
was introduced into Great Britain. The following pages summarize
the provisions of this act as amended by the legislation of 1913, 1918,
1919, and 1920,
INDUSTRIES AND OCCUPATIONS INCLUDED.

The general rule is that the insurance includes all persons, men and
women, 16 years of age or Over, under any contract of service for
which remuneration is paid. The most important limitation on this
general rule relates to nonmanual employments. Persons employed
at other than manual labor whose annual remuneration exceeds £250
($1,217; par) are not included. Prior to July 1, 1919, this limitation
was £160 ($779, par).

The official Handbook of Approved Societies (1915) sums up the
groups eligible for insurance as follows:

1. Persons in employment by way of manual labor, regardless of earnings.
2. Persons in any employment at a rate of remuneration not exceeding in value
£160 [now £250]. '
'
3. One who has been an insured person for two years or upward.
4. One who has been an employed contributor and being of the age of 60 or upward,
who shows to the satisfaction of the insurance commissioners [now the Ministry of
Health] that he or she has ceased to be insurable as an employed contributor.

It will be noted that there is now practically no age limit, though
pecuniary benefits are not paid after the age of 70 is reached. The
employments include agriculture, mining, industry, commerce, trans­
portation, and public service.
The persons exempt from the insurance are those who have rights
to sickness and other benefits from certain specified sources, such as
railway employees, school-teachers, etc., who are entitled to such
benefits from existing funds. Casual employments are exempt unless
the employment is in the regular line of the employees trade or busi­
ness.

If the person employed within the general terms of the law can
prove that (1) he is in receipt of any pension or income of the annual
value of £26 ($127, par) or more and not dependent on his personal
exertions, or (2) that he is ordinarily and mainly dependent on some
other person for his livelihood, or (3) that he is dependent for his liveli­
hood on earnings derived from an occupation which is not employ­
ment as already defined, then he may be granted exemption by the
authorities.
Voluntary insurance is permissible only for persons who have been
insured for two years or more.




SUMM ARY STATEMENT OF TH E SYSTEM.

5

DISABILITY PROVIDED FOR.

The insurance is intended to provide for inability to work due to
some specific disease or bodily or mental disablement. The pecuniary
relief commences with the fourth day of such incapacity, while the
medical relief is available from the beginning of sickness. There are
two types of disability recognized by the law: First, that usually known
as temporary disability; second, that usually termed invalidity. The
first is expected to include cases lasting less than six months in a year,
and the second, cases of longer duration or even permanent total disbility. The system is therefore a combined sickness and invalidity
insurance system. The presence of the invalidity feature is respon­
sible for the complicated financial arrangements of the system.
Accidental injuries which receive benefits under the workmen’s com­
pensation act are not usually included, but disability due to
accidents not covered by the compensation act does entitle to bene­
fits, unless by some legal process compensation or damages equal to
or in excess of the regular benefits are secured. The carriers of the
insurance may themselves take steps to secure such compensation
or damage. Venereal diseases, even if due to misconduct, must re­
ceive medical benefits and may receive pecuniary benefits.
For the women included in the insurance, provision is made for
inability to work on account of childbirth. The uninsured wife of
an insured man also receives this benefit.
THE BENEFITS.

The Denefits provided by the insurance are divided into two

froups—those administered by the‘insurance committees and those
y the “ approved societies.”

The insurance committees have charge of (1) medical benefits,
(2) sanatorium benefit (discontinued in 1921, except in Ireland),
(3) sickness benefit, (4) disablement benefit, (5) maternity benefit,
(6) additional benefits. It will be noted that there is no funeral
benefit.
Medical benefit.—This consists of such medical treatment as can
consistently, with the best interests of the patient, be properly under­
taken by a general practitioner of the usual professional skill. It also
includes the provision of medicines and of such medical and surgical
appliances as are approved by the regulations issued by the insurance
authorities; that is, by the Ministry of Health or the Scottish Board
of Health. As soon as a person is accepted as a member by an ap­
proved society, this benefit becomes available without any waiting
period. The benefit must be provided immediately on the beginning
of the disability.
Voluntary contributors are entitled to medical benefit in the same
manner as the regular contributors, but if their annual income exceeds
£250 ($1,217, par), no right to this benefit exists. Their dues, how­
ever, are reduced 2 pence (4 cents, par) weekly.
In the rare cases where the insurance authorities are satisfied that
the insured persons in any area are not receiving adequate medical
service, they may make special arrangements to provide such ser­
vice, or they may allow the beneficiaries to provide themselves with
service and pay them for the cost of it.



6

ST TIOHAL H EALTH m atJBAHCE
a

m

GREAT BRITAIN.

Sanatorium benefit.—Prior to 1921 this benefit consisted of treat­
ment in a sanatorium or similar institution, or at home, provided for
insured suffering from tuberculosis, or such other diseases as might
be designated by the minister of health (formerly by the local
government board). No diseases other than, tuberculosis have ever
received treatment under the law providing for this benefit, so that
it has always been, a tuberculosis benefit. Under the provisions of
the public health (tuberculosis) act of 1921 (11 and 12 Geo.V, ch. 12)
a general tuberculosis service for the entire population (insured and
uninsured) was instituted; the insurance system acts as a cooperating
service under the law and by complying with certain conditions has
representation on the governing bodies which administer the new
tuberculosis service. The new act does not apply to Ireland.

Sickness benefit.—This consists of a periodical payment to insured
persons rendered incapable of work by some specific disease or by
bodily or mental disablement of which notice has been given, com­
mencing on the fourth day of such incapacity and continuing for a
period not exceeding 26 weeks. If the disability continues longer
than 26 weeks, the disablement benefit (described below) begins.
These two benefits cease when the age of 70 is reached, as the old-age
pension begins at that age. Sickness benefit is not paid in maternity
cases. As some supervision of the beneficiary is required, the sick­
ness benefit is not paid while the patient resides outside of the United
Kingdom.
*
If this benefit is drawn for a period of 26 weeks, application for

benefit for another case of sickness will.be approved only when at
least 12 months have elapsed from the date of last receipt of benefit.
The societies are authorized to refuse or suspend the benefit if the
sickness was caused by miscondubt or if recovery is delayed by failure
to observe the rules.
The “ ordinary” rate of sickness benefit is 15 shillings ($3.65, par)
per week for men and 12 shillings ($2.92, par) per week for women.

The sickness benefit is payable only after the contributor has been
insured 26 weeks and has paid 26 contributions. If a person ceases
to be insured and then later again becomes an employed contributor,
a waiting period (or what may be termed a probationary period) is
again required; as the law expresses it, “he shall be treated as if
he had not previously been an insured person.”
Disablement benefit.—This consists of a periodical payment in, case
of a disease or disablement which has exhausted the sickness benefit.
The rateis 7 shillings 6 pence ($1.83, par) per week for men and women
alike and continues for the duration of tne disablement. A waiting
period (or probationary period) of 104 weeks, for which a like number
of contributions has been paid, is required. The benefit begins on
the day after sickness benefit has been exhausted, but only after
104 weeks of insurance.
Maternity benefit.—This consists of a sum of money payable after
contributors have been insured 42 weeks (formerly 26 weeks). An
insured man is entitled, on the confinement of his wife, to receive
from the society the sum of 40 shillings ($9.73, par), the benefit being
the wife’s property. If the wife is also insured, she is entitled to
receive from her society a further sum of 40 shillings, making in all
80 shillings ($19.47, par). In order not to place in an unfavorable
position the insured woman whose husband is not insured, the double



summary statement oe the system.

1

benefit of 80 shillings is paid to her also, in this case the whole amount
coming from her society. An unmarried woman is entitled, on con­
finement, to a benefit of 40 shillings.
The maternity benefit does not carry with it the right to any med­
ical attendance or medicines, nor may the insured woman receive
any sickness benefit for four weeks after the date of confinement,
unless there is some disease or disablement not connected directly or
indirectly with the confinement. However, the model rules issued
by the commissioners state “ a woman in respect of whom this benefit
is payable must be attended in her confinement by a duly qualified
medical practitioner or by a midwife possessing the prescribed quali­
fications.”
The 40 shillings benefit paid in respect of a wife’s insurance carries
with it the obligation to abstain from remunerative employment for
four weeks after the confinement.
In order to make sure that the maternity benefit reaches the widest
possible group of insured women, it is payable even though the woman
nas already exhausted her 26 weeks of sickness benefit or even if she
has been suspended from sickness benefit on account of arrears.
Similarly, when the husband is in arrears or is otherwise disqualified,
the wife’s society must pay the 80 shillings benefit.
An additional aid in maternity cases is provided by section 10 (4)b
of the act of 1911, under which no regard is to be taken of arrears of
contributions during the two weeks before and four weeks after con­
finement in the case of an insured married woman. This is equivalent
to exemption from contributions for these six weeks.
Additional benefits.—Section 37 of the 1911 act provides that where
the actuarial valuation of an approved society shows that there is a
surplus over liabilities, the society may provide for its members and
their dependents certain additional benefits. The fourth schedule
appended to the 1911 act gives a list of the permissible extensions
oi benefits. These may be summed up as consisting of increases in
the ordinary benefits, expecially in cases where a member has de­
pendents, an addition to the old-age pension provided by the act of
1908, grants to Members in distress, etc., but such additional bene­
fits may not include a funeral benefit.
These additional benefits are to be paid when the periodical valua­
tion of a society shows the presence of a surplus. Because of war
conditions, it was not feasible to make such an actuarial valuation
until the arrival of peace.
SOURCES OF INCOME.

The funds of the insurance system are derived from three sources:
(1) The contributions of the insured person; (2) the contributions of
the employer; (3) grants from the national treasury.
Contributions.—The so-called “ employed rate” is as follows: The
contributions for men are 10 pence (20.3 cents, par) weekly; for
women, 9 pence (18.3 cents, par) weekly. This is divided as follows:
The man pays 5 pence (10.1 cents, par), the employer 5 pence; the
woman pays 4 pence (8.1 cents, par), the employer 5 pence. These
rates, it will be noted, are “flat” rates, being uniform for the whole
class of “ employed contributors.”



8

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

“ Employed contributors” form the great majority of the insured
>ersons, but there are special groups of so-called “ low-wage earners”
or whom special provision is made.
Arrears .—Arrears due to sickness or disablement and, in the case
of woman members, due to maternity, are disregarded in making up
the accounts. The general principle is that any loss which a society
suffers by the nonpayment of a member's dues in one year shall be
inade good to the society by the reduction of his benefits in the
following year. The arrears of one year are canceled in the next
year, even if no benefit is claimed, so that the member in arrears
makes, as it were, a fresh start each year.

J

FINANCIAL ADMINISTRATION.

The finances of the system are based on a plan of level premiums;
that is, the contributions are uniform for all ages regardless of the
higher sickness and disablement rates in the older age groups. As
this plan provides both sickness and validity insurance, the accu­
mulation of a reserve is necessary. This combination makes the
plan? extremely involved.

The weekly dues of 5 pence (10.1 cents, par) for men and 4 pence
(8.1 cents, par) for women are paid by deductions from wages; the
employer adds 5 pence to each of these amounts and affixes special
stamps of the proper value to the card of the employee on the dates
when wages are paid. The stamps are purchased from the post
office, which deposits the receipts in the national health insurance
fund. From this fund the money is drawn for the payment of
benefits and for expenses of administration.

The portion of the expense defrayed bv the National: Government
was, at the start, two-ninths of the cost of benefits and of administra­
tion for the men, and one-fourth of these expenditures for the women.
At present it is two-ninths for men and women alike.
The cost of administration in the societies may not exceed 41 pence
(83.1 cents, par) per member annually. If there is a deficiency in
the administration account, an assessment must be levied on the
members.
The rates of dues and the schedule of benefits of the system were
computed on the basis of being self-sustaining for a person who
entered the insurance at the age of 16; but for a person who entered
at a later age the contributions were not considered to be sufficient
to provide the benefits. The system thus began with a liability
which was estimated as being £87,000,000 ($423,385,500, par). To
cover this amount each person entering the insurance has credited
to him a theoretical credit—called a “ reserve valuer” At the start
this amount was to be made up by setting aside as a sinking fund a
portion of the weekly dues of each contributor, as follows: For the
men, I f pence (2.4 cents, par); for the women, If pence (3 cents, par).
By the act of 1918 the deduction in the case of women was made
If pence (3.2 cents, par). It was originally estimated that these
deductions would cancel the “ reserve values” at the end of a period
of about 18 years; it is now believed that this period will be somewhat
longer than that.

A special committee appointed in 1916 to make a study of the
finances of the system reported that the funds available for women's



SUMM ARY STATEMENT OF TH E SYSTEM.

9

benefits were inadequate, and recommended that part of the deduc­
tions just described should be devoted to current expenses. The
1918 law provided (sec. 1) that part of the sums should be applied
to the accumulation of two special funds—the central fund and the
contingencies fund. The central fund is to receive one-eighth and
the contingencies fund seven-eighths of a sum representing in the
case of men two-thirds of a penny (1.4 cents, par) and in the case
of women one-half of a penny (1 cent, par) for each weekly contribu­
tion paid in respect of a member of a society.
The central fund is intended to meet any deficit arising out of an
abnormal rate of sickness. It receives in addition to the abovementioned sum, and the interest which has accumulated on it, a
sum of £150,000 ($729,975, par) annually from Parliament.
In general it may be said that the purpose of the contingencies fund
is to meet any deficit which appears wnen an actuarial valuation is
made; however, the amounts apportioned to any one society belong
to the credit of that society only and may not be used to meet a
deficit in any other society.
Besides these two funds, the 1918 act also creates a women’s
equalization fund, to be used in assisting societies in meeting their
liabilities arising out of the sickness claims of women. It is distrib­
uted to the societies pro rata on the basis of the number of married
woman members. In general it may be said that this fund is to
meet the disabilities due to childbearing.
GENERAL ADMINISTRATION.
Ministry o f Health.—The Ministry of Health act of June 3, 1919,
made a number of important changes in the administration of the
insurance svstem. This act, as far as it applies to health insurance,
came into force July 1, 1919, and other powers are being added to
it from time to time. The powers and duties of the new ministry
include the supervision and administration of the entire insurance
system.
National Health Insurance Joint Committee.—Prior to June, 1919,
the system was in charge of four bodies known as insurance com­
missioners, there being one each for England, Scotland, Wales, and
Ireland. Over these lour boards was an organization composed of
representatives of each, called the National Health Insurance Joint
Committee, a federated body whose principal function was to take
charge of all matters common to the four boards, especially the
actuarial problems.
By the terms of the Ministry of Health act, the joint committee
is composed of the Minister of Health as chairman, the secretary for
Scotland, the chief secretary for Ireland, and one other person apointed
S by the minister to represent the Welsh insurance system.

ixcept for this change of personnel, the previous constitution of the
joint committee and its rights and duties are unchanged. All of
the powers and duties formerly belonging to two of these bodies, the
insurance commissioners for England and the insurance commis­
sioners for Wales, are henceforth to be exercised by the Ministry
of Health, and all their employees are transferred to the new min­
istry.




10

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

The most important work carried on by the joint committee is
that relating to the actuarial features of the insurance; this includes,
for instance, the calculation of the rates of contributions, reserve
values, etc. An actuarial advisory committee has aided the joint
committed since the commencement of the act.
Until the passage of the Ministry of Health act, there was attached
to the joint committee a special committee on medical research, to
make special investigations on matters relating to any disease to
which the insured persons are subject. The expense of these inves­
tigations is provided for by special appropriations by Parliament,
the amount of 1 penny (2 cents, par) per insured person being granted.
In the future tms research committee is to be entirely independent
of the insurance system.
Insurance commissioners.—In the future, the administration will be
divided into three parts, one for England and Wales and one each
for Scotland and Ireland.
The former insurance commissioners are now the insurance de­
partment of the Ministry of Health, and may be used as typical in
describing the scope and organization of these bodies. The ministry
may appoint such officers, inspectors, and other employees as they
see fit, subject to certain supervision of the treasury authorities; they
may sue and be sued and nold property. They nave authority to
issue regulations authorized by the insurance laws; they approve
the statutes and supervise the administration of the approved
societies.
The ministry have an advisory committee to give advice and
assistance in making regulations for the administration of the laws;
this committee consists of representatives of the employers, of the
approved societies, and of the medical profession, ana of such other
persons as the ministry may appoint, of whom at least two must be
women.
Approved societies.—When the plans for the health insurance
system were formulated, the United Kingdom was covered by a
network of friendly societies, trade-unions, commercial insurance
companies, sick clubs, establishment iunds, and similar voluntary
organizations which provided a variety of benefits for sickness,
accidental injury, superannuation, etc. Many of these organizations
had a long history of Usefulness in providing relief for distress from
these causes, and it was decided to use the societies as the carriers
of the pecuniary benefits. The insurance laws therefore provide
that the insured persons shall group themselves into self-governing
bodies—the organizations just named—which shall be responsible
for the administration to their members of the pecuniary benefits
provided by the system. These societies, if they meet the require­
ments of the law, are recognized by the insurance commissioners as
“ approved societies.” The general requirements are that the
society shall be self-governing, not conducted for profit, and generally
be in a position to carry out the provisions of the law. In order to
permit any organization to continue such activities as are not cov­
ered by the law, the societies may have a special section for admin­
istering the provisions of the insurance acts, whose accounts must be
kept separate from other activities. Special arrangements are made
for federating societies whose membership is not large enough to
provide an adequate basis to carry the risks of an influenza epidemic



SUMM ARY STATEMENT OF TH E SYSTEM.

11

or similar tax on their resources. These societies were required to
enact by-laws which were submitted to the commissioners for ap­
proval and which complied with the general scheme of administra­
tion. They could accept such members as they saw fit, except that
they could not reject an applicant solely on account of age.

A person may not be a member of more than one society for the
purpose of State insurance.
The principal functions of the approved societies are the payment
of cash benefits, the keeping of records of the members, and the
supervision of beneficiaries.

Insurance committees.—For each county and county borough of
the United Kingdom there is a body called an insurance committee,
which has charge of the medical and (formerly) sanatorium bene­
fits. The members of these committees in England and Wales are
appointed by the Ministry of Health. The committees must be
composed of not less than 40 nor more than 80 members, consisting
of representatives of the insured persons, of the county govern­
ment, and of the medical profession, and other persons appointed by
the Ministry of Health.
Each committee must make such arrangements with duly quali­
fied medical practitioners in the county as will assure to the in­
sured persons adequate medical attendance and treatment. The
committee prepares a list of doctors who are willing to attend in­
sured persons, and this list, called the “panel,” must be duly pub­
lished. Usually it is displayed in each post office as well as dis­
tributed among the insured persons. Each of the latter may select
from the panel the doctor whom he desires for his physician.
The committee must also prepare and publish lists of persons or
firms who are willing to supply drugs, medicines, and appliances to
insured persons in accordance with regulations made by the authori­
ties. The committee must make in advance an agreement with
the druggists (“chemists”) as to the schedule of prices for drugs,
etc., subject to the approval of the authorities.
The administration of the sanatorium benefit was originally in
the hands of the committees entirely; later, special grants were
made by Parliament to various local organizations engaged in com­
bating tuberculosis; but since the enactment of the Ministry of
Health law, all this work has been placed in charge of the ministry,
and under the act of 1920 was removed from the insurance system
and placed under a special health-service system of the Ministry of
Health.

DEPOSIT CONTRIBUTORS’ FUND.

As the societies could reject an applicant for any reason except
age, it was expected that there would be a number of persons who,
on account of ill health or other reason, could not obtain member­
ship. For this group a special organization, “ the deposit con­
tributors’ fund” (originally called the post-office fund), was created.
It was expected that this fund would have close to a million mem­
bers, but at the close of the year 1919 the number was estimated to
be 450,000.
The deposit contributors are entitled to such benefits as the sum
to their credit will provide. They may, for instance, draw sickness



12

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

benefit only until they have exhausted the amount standing to their
credit. Such contributors are in a distinctly less favorable position
than the regular contributors.
PERSONS INCLUDED.

COMPULSORY INSURANCE.

The fundamental rule is that every person, man or woman, who
is engaged in manual employment m the United Kingdom under
any contract of service or apprenticeship, or in nonmanual employ­
ment and earning less than £250 ($1,217, par) annually, is included
within the terms of the insurance as a compulsory member—usu­
ally referred to as an “ employed contributor.
Under the act of 1911 the limit of remuneration was £160 ($779,
par); because of the increase of wages during and following the war
the act of 1919 raised the exemption limit in order to prevent the
loss of the insurance rights of persons who desired to continue their
insurance.

By far the greatest number of persons included in the insurance
have become members of one oi the “ approved societies” which
administer the pecuniary benefits. The official Handbook of Ap­
proved Societies (August, 1915, and Supplement, 1918) thus describes
the groups of persons eligible for membership in these societies:

1. Persons in employment by way of manual labor:
2. Persons in any employment at a rate of remuneration not exceeding in value
£250 [$1;217, par] a year.
3. Persons engaged in some regular occupation and wholly or mainly dependent
for their livelihood on the earnings derived from that occupation, and who have a
total^ income, including earnings, of not exceeding £250 a year. [The act of 1918
provided that no new admissions to this group should be made after July 1, 1918.]
4. One who has been an insured person for two years or more.
5. One who has been an employed contributor and, being of the age of 60 or up­
ward, who shows to the satisfaction of the insurance commissioners that he or she
has ceased to be insurable as an employed contributor.

One of the difficulties experienced in the administration of the
original act arose from the large number of classes of membership
provided for; under the 1911 act there were 23 classes. This was
reduced somewhat by the 1913 act and finally the 1918 act brought
the number down to 8. As there are also two classes of deposit
contributors, the total number of membership classes is now 10.
The names and symbols used in designating the 8 classes are as
follows:
Cl a s se s of M e m b e b s , 1918.
A. —Men employed contributors.
A (M).—Men employed on foreign trade ships.
B. —Men in Navy, Army, or air forces.
C. —Men voluntary contributors.
E. —Women employed contributors.
E (M).—Women employed on foreign trade ships.
F. —Women voluntary contributors.
K.—Women entitled to special benefits on or after marriage.

To this schedule should be added those persons, men ancl women,
who do not become members of approved societies and who join the
so-called deposit contributors' fund.




PERSONS INCLUDED.

13

If a question arises as to whether an employment or a person is
included within the insurance, the matter is to be decided by the
minister, with the right of appeal to a judge of the high court selected
to hear such cases, whose decision is final. As such a hearing in­
volves an elaborate procedure, efforts are" usually made to decide
the matter without recourse to the courts. That these efforts have
met with considerable success is shown by the fact that in the years
1917 to 1919, inclusive, only two cases were appealed to the courts.
VOLUNTARY INSURANCE.

When the plan of the British system was prepared, it was considered
necessary to justify the State contribution to those who were com­
pulsorily insured, by offering an equal grant to the same economic
group of the population to whom the compulsory feature did not
apply because it chanced that they were working on their own ac­
count instead of being in the service of some employer. ^Accordingly
a plan of voluntary insurance was prepared for the benefit of per­
sons who were engaged in some regular occupation on which they
were wh 11
• 1 1
1 from which they derived an
persons required to insure.
income
The plan devised and adopted m tne act of 1911 was rather compli­
cated and demanded a large amount of administrative labor to carry it
out. The number of persons who took advantage of this opportunity
proved to be much smaller than had been expected. The depart­
mental committee which reported in 1916 found that there were only
28,000 persons at that time who had taken advantage of the oppor­
tunity m the four years that it had been open. After considering
the various aspects of the problem, the committee recommended that
the class of voluntary contributors be discontinued, mainly on acT
count of the high cost of administration, but partly because of the
small numbers who had accepted the offer. The act of 1918 adopted
the recommendations of the committee by abolishing voluntary in­
surance, but leaving it open to those who had been insured as volun­
tary contributors at the time and to those described in the next
paragraph.
At the present time the right to voluntary insurance is restricted
to persons who have been compulsory members in full standing, but
who have ceased to be included within the groups covered by the com­
pulsory provisions, but not including married women, for the reason
stated below. Section 7 of the act of 1918 provides that those per­
sons who had been employed contributors for 104 weeks, that isf
who had reached the status of full benefits, should thereafter have
the right to voluntary insurance. Voluntary insurance at the present
time is intended merely to protect the interests of persons who have
been employed contributors and who pass to a noninsurable; status!
It was pointed out that poor health was very frequently the reason for
a person leaving employment and setting up in business in a small way
for himself jit woulatherefore be an injustice to suchpersons to abolish
voluntary, insurance altogether, as many society .officials had urged.
Women employed contributors who give up employment on mar­
riage may not continue as voluntary contributors. This exclusion
was adopted on the advice of the friendly societies, who pointed out
that supervision in such; cases was practically impossible/that the
104936°—23—Bull. 312— 2'




14

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

test of ability to work could hardly be applied and that the sickness
rate of married women was known to behiffh. A married woman in
employment is, of course, not affected by this ruling.
DEPOSIT CONTRIBUTORS.

Persons who are in poor health and clearly substandard risks for
any insurance system were provided for by organizing the deposit
contributors’ fund, into which they are admitted on application.
The societies which act as carriers of the insurance have aided mate­
rially in settling this question by waiving any right to medical ex­
amination, so that the person in poor health has had practically no
difficulty in securing admission to a society.
In the future new entrants will, as a rule, come into insurance at
the age of 16, when poor health or serious disease is least frequent,
and the problem will be one of diminishing importance.
DEPENDENTS OF INSURED PERSONS.

The only member (not insured) of the family of an insured man
who is entitled to benefit at present is the wife of an employed con­
tributor, who receives maternity benefit. If after a valuation a
society is shown to have a surplus over the capital sum necessary to
rovide the statutory (or minimum) benefits, then certain specified
enefits may be provided for the dependents of an insured person.

E

PERSONS GRANTED EXEMPTION FROM COMPULSORY INSURANCE.

Ordinarily a person subject to the compulsory provisions of the.
law must become a member either of an approved society or of the
deposit contributors’ fund. On application, however, a person may
be granted a certificate of exemption from insurance. At present
this certificate may be issued on any one of four grounds:
1. That the applicant is in receipt of income or pension of the an­
nual value of £26 ($126.53 par) or upward, not dependent upon his
personal exertions.
2. That he is ordinarily and mainly dependent for his livelihood
upon some other person.
3. That he is ordinarily and mainly dependent for his livelihood
on the earnings derived by hijn from an occupation which is not em­
ployment within the meaning of the insurance acts.
4. That he is intermittently employed.
The first three of the foregoing grounds for exemption can be de­
termined from the personal history of the applicant. The question
of intermittent eihployment is now defined by regulations issued
under authority 6f section 8 of the 1918 act; the applicant must no#
prove that he has been employed less than 13 weeks in each of two
successive contribution years.
INDUSTRIES AND EMPLOYMENTS INCLUDED.

The industries and occupations subject to compulsory insurance
can be stated in brief form. The general rule is that the law covers
all those occupations where therefis a contract of service, first, if
"the occupation is manual, regardless of the amount of remuneration,
and, second, if the occupation is nonmanual, if the remuneration is
less than £2$Q ($1,217, par) annually. This includes agriculture,



DISABILITY PROVIDED FOR.

15

forestry, quarrying, mining, manufacturing, commerce, transporta­
tion by land and water, banking, insurance, building trades, “ out­
workers,” domestic service, etc. Persons employed in the navy,
army, and air forces are also included, as are the civil employees
of the various Government offices (if they are not otherwise insured).
There is a long list of exceptions to this general statement of the
occupations covered; most of these exceptions relate to employments
in which equivalent benefits are provided under some other arrange­
ment. Thus employment by the Crown, by a local authority, by a
railway company where equal provision in case of sickness or dis­
ablement is made, are exempt employments. Similarly, casual
employment otherwise than for the purposes of the employer’s
trade or business and subsidiary employment which is not the prin­
cipal means of livelihood are exempt. This brief summary is not
complete, but it serves to show the basis on which employments are
excluded from the insurance.
DISABILITY PROVIDED FOR.

The purpose of the insurance is, first, to restore the insured person
to health if possible, and, second, to afford some measure of pecuniary
relief for the loss of wages. According to the phraseology of the law,
its benefits are to be provided for inability to work, due to some
specific disease or bodily or mental disablement. The law recognizes
two types of disability: First, temporary disability lasting not more
than 26 weeks, and, second, prolonged disability, or invalidity, con­
tinuing after the 26 weeks’ period just referred to and covering a life­
time if necessary. The system is therefore a combined sickness and
invalidity insurance organization.

For the women included among the insured persons, pecuniary
benefit is paid for inability to work on account o f childbearing; this
includes benefit during both pregnancy and confinement. This
benefit is also provided for the uninsured wife of an insured man.

As sickness and disablement benefits are paid for inability to work,
they must be paid for accident cases as well as illness. When the
injured person has a claim for compensation or for damages the
society has the right to recover the amounts it advances from the
person liable for compensation or damages. The laws carefully
prescribe the procedure to be followed in such cases. It will be
recalled that the British workmen’s compensation act also includes
certain occupational diseases, thus relieving the health insurance
system of this burden. Judicial decisions have established the right
of the approved society to bring action, in the name of the injured
person, to recover compensation or damages.
The disability due to sickness caused by misconduct, especially
disobedience of rules, is not ground for receiving any pecuniary
benefit, though medical and sanatorium benefit must be provided.
Prior to the enactment of the act of 1918, the societies could exclude
persons from pecuniary benefit in the case of venereal disease, on
the ground of misconduct. Under section 46 of the 1918 act, the
executive body of a society was authorized to make amendments
to the society’s rules, specifically providing for such payment pending
its adoption by the society. The first report of the Ministry of Health
states that such action was generally taken by the societies,



16

-NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

An unmarried woman may not be refused sickness or disablement
benefit on the ground that disability due to pregnancy was caused by
misconduct (act of 1918, section 12-3). The welfare of the child is
of course the reason for this provision.
BENEFITS.

The benefits provided by the system are the following:
1. Medical benefit.
2. Sanatorium benefit (transferred to other authorities during
1921).
3. Sickness benefit.
4. Disablement benefit.
5. Maternity benefit.
6. Additional benefits.
These benefits are listed in the order in which they appear in the
law. They provide first for medical aid for the return to health of
the insured person if possible, a pecuniary benefit to replace in a
measure the wage loss, the grant of a sum of money on the occasion
of childbirth and, if the financial status of the earner will permit, an
extension of these benefits. There is no funeral benefit, such as
most compulsory systems of health insurance provide.
The benefits are described in the order here given.
MEDICAL BENEFIT.

The medical benefit, in brief, consists of the provision of doctor’s
services and of medicines, appliances, etc. As in any given area
there would probably be a large number of approved societies
administering the pecuniary benefits, it was necessary* to create a
special body to provide and supervise the medical benefit. This
organization is called the “ insurance committee,” and all features
of this benefit, including such as may be provided under “ additional”
benefits, must be administered by and through this committee.
As a rule a committee is appointed for each county and county
borough; if the Ministry of Health so orders, certam committees
may be combined.
Qualifications.—K person is qualified for medical benefit as soon
as he becomes a member; there is no waiting period and the law
makes no mention of any specific number of contributions to be paid,
though a person of 65 or oyer on entering must have 26 contributions
to his credit before he is entitled to this benefit. Under the 1920
act, the minister is authorized to make regulations under which the
funds of approved societies will be debited with such a sum as
represents the estimated cost of medical benefit in respect of each
member who attains the age of 70. The fact that a member’s
contributions are in arrears does not affect his right to medical
benefit; as long as he remains in insurance, the benefit must be
provided.
,
General arrangements for medical service.—The insurance com­
mittee, after consultation with the local medical committee and the
panel committee, must prepare and publish a statement of the
terms upon which doctors are to furnish medical service; alb such
statements must have the approval of the minister and must con­
form to the general regulations issued by him. The insurance com­
mittee must likewise publish a “ medical list” (i. e., the “ panel”)



BENEFITS.

17

containing the names of the physicians who have accepted service,
as well as their residence and office addresses, office hours, etc. This
list must be made available for insured persons in a convenient
manner, and copies must be furnished to the panel and to the
pharmaceutical committees, as well as to the parties furnishing
drugs, medicines, etc.
If the minister is satisfied that the insured persons in any area
are not receiving satisfactory medical treatment under the panel
system, he may authorize the insurance committee to make such
other arrangements as will secure better service, with due regard
to the funds available. He may also allow the insured persons in
such cases to make their own arrangements.
Rather elaborate arrangements are provided under the medical
benefit regulations to permit certain insured persons to provide
their own medical service, and a slight reduction in the contribution
is allowed in such cases. As these cases are exceptional, it is only
necessary to state that an account of the arrangements will be
found in the fourth schedule of the Medical Benefit Regulations of
1920. The act of 1920 provides that no voluntary contributor
whose income exceeds £250 ($1,217, par) may have medical benefit;
in addition, the insurance committee may exclude those insured
persons whose income exceeds a specified limit.
Allocation.—Each insured person is supplied with a “medical
card,” which must be used for purposes of identification whenever
he applies for treatment. From the “medical list” he selects the
physician by whom he wishes to be treated and either brings or
sends the card to the doctor’s office for acceptance; the latter of
course may decline to accept the applicant, in which case he either
selects another doctor or, if he fails to do this, is assigned to another.
The insurance committee and the panel committee must jointly
draw up a plan for the allocation of insured persons among the
doctors on the panel. It has been found that a large number of
insured persons have no special preference for a particular doctor
and are entirely willing to have their medical adviser assigned. The
plan just referred to must also provide for other details of medical
service, the feature most often referred to being the limitation of
the number of insured persons on the list of one physician. The
1920 regulations restrict the number of names on the list of a doctor
who practices without an assistant or partner to 3,000, though it
frequently occurs that many more than this number of persons
apply to one doctor for acceptance. The plan must make provisions
for distributing the excess, either by removing names or by securing
an assistant or partner for the practitioner.
The insurance committee and the panel committee are required to
agree to a limit for each area, subject to this maximum of 3,000, and
in one-third of the areas the maximum is fixed at 2,500; in some
areas it is 2,000. These large lists, however, are not at all general,
as may be seen from the fact that on January 1, 1921, about 34 per
cent of the doctors had less than 600 persons on their lists; another
30 per cent had between 600 and 1,200; about 22 per cent had between
1,200 and 2,000; and only 14 per cent had above 2,000. The num­
ber of practitioners with 3,000 names or more on their lists was less
than 300.1 The number of names on a list, of course, should be care­
1 Second annual report of the Ministry of Health, 1920-21. Cmd. 1446. P. 43.



18

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

fully distinguished from the number of patients given treatment. It
is estimated that about 60 per cent of the insured persons apply for
treatment each year.
If an insured person so desires, he may change his doctor on the
last day of June or of December in any year by giving notice in writing
to the insurance committee; the change may also be made by mutual
agreement between the insured person and the doctor who has been
treating him, in which case the cnange must be reported to the insur­
ance committee by the new doctor within seven days. As there is
a large amount of clerical work involved in the listing of these
changes, the aim of the insurance committee is to discourage them
as much as possible.
Drugs and appliances.—The insurance committee proceeds in a
similar manner m regard to the supply of drugs, medicines, appli­
ances, etc. After consulting with the local pharmaceutical commit­
tee, the insurance committee prepares and publishes a list of persons
or firms, also with the approval of, and under the regulations pre­
scribed by, the minister. This list must be made available to the
various committees affected, to the panel doctors, and to the insured
persons. Arrangements must be made to have one or more places
of supply open at all reasonable times, and where such a place is not
reasonably accessible, arrangements must be made to have a panel
doctor furnish medicines, etc.
The minister is required to prepare a list of drugs, etc., called the
“ drug tariff,” which gives the prices at which articles are ordinarily
to be supplied by the pharmacists. The prices must be varied from time
to time to meet changes that may occur. The drug tariff includes
the medicines, etc., usually called for by the doctors and specifies the
method by which the prices of unusual drugs are to be ascertained.
Besides the drug tariff, the minister specifies the appliances which
must be supplied. As given in the second schedule of the 1920
Medical Benefit Regulations, the “list of appliances” is as follows:
L ist of A ppl ia n c e s .

Adhesive plaster.
Bandages, rolled:
Calico.
Cr6pe.
Domette.
Elastic-web.
Flannel.
India-rubber.
Muslin.
Open-wove.
Plaster of Paris.
Catheters:
Gum-elastic.
Soft rubber.
Cotton wools, absorbent:
Boric.
Sai-alembroth.
Unmedicated.
Gauzes:
Boric.
Carbolic.
Double cyanide.
Iodoform.^Picric.
Sal-alembroth.



Gauzes—Concluded.
Sublimate.
Unmedicated.
Gauze and cotton wool tissue.
Ice bags:
Check sheeting.
India-rubber.
Lints:
Boric.
Sal-alembroth.
Unmedicated.
Protectives:
Gutta-percha tissue.
Jaconet.
Oiled cambric.
Oiled paper.
Oiled silk.
Splints.
Suspensory bandages:
Cotton.
Tows:
Carbolized.
Unmedicated.
Wood wool.

H
The 1920-21 report of the Ministry of Health refers (p. 41) to the
criticism sometimes made, that the insured persons do not get the
“proper and sufficient medicines’7 to which they are entitled because
the doctors, it is said, hesitate to prescribe expensive medicines which
they think necessary, since the regulations penalize doctors for exces­
sive prescribing. The answer made to this criticism is that no doctor
can be penalized in any way for prescribing particular drugs or appli­
ances unless it be found after an investigation “ that by reason of the
character or quantity of the drugs or appliances so ordered or sup­
plied, the cost is in excess of what may reasonably be necessary for
the adequate treatment” of the insured person. This provision is
necessary as otherwise doctors could prescribe medicines at public
cost without any restriction whatever. The body to which is in­
trusted the duty of investigating these questions of prescription is
the panel committee of the area, consisting entirely of medical practi­
tioners; it is intrusted with the duty not only of investigating the
facts, but also of recommending the amount, if any, to be assessed
against the doctor, in any case brought before the committee. This
method was adopted at the request of the doctors themselves, who
have undertaken that the work shall be fairly performed.
Kind of treatment provided.—The treatment which a practitioner is
required to give to his patients comprises such treatment as is of a
kind which can, consistently with the best interests of the patient,
be properly undertaken by a general practitioner of ordinary pro­
fessional competence and skill. When necessary he shall indicate
to the patient how special or unusual service may be secured. The
practitioner must have proper and sufficient surgery and waiting
room accommodation for his patients, and must have regular days
and hours of consultation. He is required to visit and treat a
patient whose condition so requires, at any place where the patient
may be, if it is within the district previously agreed upon with the
insurance committee. The practitioner must fill out such prescrip­
tions as are necessary, on the forms provided for the purpose, though
under certain circumstances he must provide drugs or appliances
himself, especially in emergency cases. He must also fill out the
medical certificates for his patients, and must keep such records of
the diseases of his patients and of the treatment prescribed as the
Ministry of Health may require. A practitioner may not demand
from an insured person on his list any fee for the service or for any
drug he is expected to provide.
The law specifically excludes the provision of medical benefit in
respect of a confinement.
Certification.—The insured person who is incapable of work by
reason of some specific disease or bodily or mental disablement must
be given a certificate to that effect by the panel doctor. These cer­
tificates are made out on blank forms supplied by the insurance
committee for this purpose and no other kind of certificate is per­
mitted. They are of three kinds: The first certificate, given when
the incapacity is first determined; the second or intermediate certi­
ficate, given after eight days of incapacity have passed, with renewals
week by week during incapacity; and the final certificate, given
when the patient is able to resume work. The certificate must be
dated, must state the cause of the incapacity, and must be signed
by the doctor personally. These certificates must be presented by



fefcSTKFlTS.

20

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

the insured person to his society when he submits a claim for the
pecuniary benefits.
In addition to the certificates above mentioned, several special
forms are used, but in the main these three are all that are used m the
great majority of cases. As this feature is of considerable impor­
tance, the forms used are given below, being reproduced from Statutory
Rules and Orders, 1921, Kk). 1780, dated hTovember 22, 1921.
F

orms op

C e r t if ic a t e .

FIRST CERTIFICATE OF INCAPACITY FOR W ORK.

T o ...........................................................................................
I hereby certify that I have examined you on the undermentioned date, and that
in my opinion you were at the time of examination incapable of work by reason
of* ... . .
......................... . . .
............................. ................................... ..
tYou should come to see me again o n .......................day next.

Doctor’s signature.......................................................................
%Dateof examination..................................................................
%Ddte of signing..........................................................................
Any other remarks hy doctor......................................— ............
INTERM EDIATE CERTIFICATE.

T o ........................... ............................................................
I hereby certify that I have examined you on the undermentioned date, and that in
my opinion you have remained incapable of work up to and including that date by
reason of *...............................................................................- ...........................................................
tYou should come to see me again o n .......................day next.

Doctor’s signature...........................................•-.........................
%Date of examination.................................................................
%Date of signing......................................................................
Any other remarks hy doctor........................................................
FINAL CERTIFICATE.

To..........................................................................................
I hereby certify that I have this day examined you, and that in my opinion you
have remained incapable of work up to and including to-day by reason of *...................
and are fit to resume work after to-day.

Doctor’s signature.............................
Date of signing........................................
Any other remarks hy doctor....................

SANATORIUM BENEFIT.

Prior to 1921.—The benefit before 1921 was administered by the
insurance committees, who were required to make arrangements to
provide insured persons suffering from tuberculosis or “ any other
such disease ” with treatment in a sanatorium or a similar institution.
These arrangements could be made with any persons or with any
local authorities (except poor-law authorities) having the manage­

* Here insert the name of the specific disease or bodily or mental disablement which renders the insured
person incapable of work.
t To be filled up at doctor's discretion, where not obligatory under rules.
t These dates should ordinarily coincide, and both lines may in that case be bracketed together and the
one date inserted.




BENEFITS.

21

ment of such institutions, which must have received the approval of
the Ministry of Health. Authority was expressly conferred on local
authorities to make such contracts with insurance committees.
As a matter of fact, the benefit has been restricted to cases of tuber­
culosis.
To secure this benefit, a member had to be recommended for treat­
ment by the insurance committee. The number of beds available
in sanatoriums has always been insufficient and the purpose of
requiring the assent of the committee was to use the facilities first for
cases where there was prospect of recovery and then for other cases.
A member became qualified for benefit just as soon as he was
insured (without any waiting period) and the right to benefit did not
cease at the age of 70.
After 1921.—Under the provisions of the act of 1920, the sana­
torium benefit is removed from the insurance system, though
domiciliary treatment for tuberculosis is continued. According
to the law approved May 12,1921, entitled “ Public health (tuber­
culosis) act, 1921” (11 and 12, Geo. V, ch. 12), this feature is to be a
cooperative service jointly with the local authorities. The subtitle
of the measure reads u An act to make further provision with respect
to arrangements by local authorities for the treatment of tubercu­
losis.” Under the terms of the act, where the council of any county
or of any county borough has made arrangements for the treatment
of persons suffering from tuberculosis, including persons insured
under the insurance acts, these arrangements are to be considered
adequate and are to continue to receive the parliamentary grant in
aid for that purpose. But where any such council fails.to make
adequate arrangements for the treatment of tuberculosis at or in
dispensaries, sanatoriums, or other institutions approved by the
Minister of Health, then the minister may make such arrangements
as he may consider necessary for this purpose, though the council
must first have an opportunity to be heard. In instituting such
arrangements any expense incurred by the minister may be paid
in the first instance out of moneys appropriated by Parliament;
on demand the council shall later repay these expenditures, which
are specifically stated to be recoverable as a debt due the Crown.
The act also definitely authorizes the local authorities to include
“ aftercare” in the arrangements for the treatment of tuberculosis
cases.
The powers of the local councils may be exercised by a committee
of its members, and this committee or subcommittee may include
persons, such as members of insurance committees, who are quali­
fied by training and experience in matters relating to the treatment
of tuberculosis. At least two-thirds of such a committee or sub­
committee must be members of the council.
The expenses of the county councils incurred under the act are to
be treated as expenses for general county purposes. Several county
councils may form joint committees under the supervision of the
Minister of Health in order to cooperate in this field.
The change in the administration of this benefit occurred on
May 1, 1921. As stated above, a part of the tuberculosis treatment
still remains under the insurance authorities; if the insured person
can be given treatment in his home (domiciliary treatment), it is
provided by the insurance practitioner under agreements made



22

NATIONAL H EALTH IHSURAtfCE Itf GREAT B R lTA ltf.

between the latter and the particular insurance committee, because
section 4(3) of the act of 1920 specifically includes in the medical
benefit such attendance and treatment for tuberculosis. The cost
of the service is defrayed by allotting an amount equal to that
portion of the sanatorium benefit fund which was previously devoted
to the remuneration of those practitioners for the domiciliary treat­
ment of tuberculosis. The essential change is in regard to the
provision of institutional treatment. Under the revised scheme of
contributions instituted by the act of 1920, insured persons and their
employers no longer contribute toward the cost of this treatment,
ana the insurance committees no longer have the duty of making
arrangements for the institutional treatment of insured persons
suffering from tuberculosis. The county and county borough
councils will provide institutional treatment for insured persons
direct, as well as for noninsured persons. Special measures have
been taken to provide for close cooperation between the insurance
ractitioners
E also beenand thetotuberculosis officers oftothe councils; provision
as
made enable the councils supply extra nourish­
ment to tuberculous persons (insured and noninsured) in* their
homes, in continuation of the service previously provided by the
insurance committees.
In Wales, the provision for tuberculosis treatment is to be con­
tinued in cooperation with institutions conducted by the King
Edward VII Welsh National Memorial Association. The act does
not apply to Scotland or Ireland. In Ireland the sanatorium
benefit is to be continued. In Scotland the Scottish Board of Health,
by Statutory Rules and Orders, 1920, No. 2181-S.108, terminated
’ the sanatorium benefit on January 1, 1921, and transferred the
care of tuberculosis patients in institutions to the local authorities,
together with such surplus funds, records, etc., as belonged to this
work.
The reasons for the removal of the sanatorium benefit from the
insurance system were set forth by the Minister of Health at the time
of the discussion of the act of 1920. According to the minister,
there has not been a failure to secure results under the insurance
benefit, but in order to secure effective results for the whole popu­
lation there is needed a more comprehensive plan of attack than is
ossible under an insurance system. In the House of Commons
debates for May, 1920, page 221, occurs the following discussion, led
by Doctor Addison, theMinister of Health:

E

Doctor A d d iso n . The purpose of taking sanatorium treatment out of the bill is
because we contemplate a health service which will make use of all the general
health services which are assisting in the treatment of tuberculosis in one form or
another, including a considerable amount of work done in respect of tuberculosis
in, say, poor-law infirmaries. Any improved health system must be sufficiently
comprehensive; and as experience nas gone on we see more and more that you have
to have a considerable organization and set up a service beyond the sanatorium
and before it. There is, for example, the tuberculosis dispensary which is pro­
vided and maintained by the various local authorities. Then sanatoriums have,
with few exceptions, been provided by the great local authorities—the county
councils, etc.—and these, with few exceptions, have made arrangements for the
reception of their cases into the institutions.
We have found more and more as the result of the war that a great deal of the expendi­
ture incurred in sending people to sanatoriums was wasted. A large percentage went
back to their trades, which perhaps imposed heavy burdens beyond their powers; the
result was they relapsed, and came again into the hands of the insurance committees.
In some districts a very large percentage have relapsed. It is clear that a good deal




BENEFITS.

23

of this money has been wasted. This is true if we contemplate, at all events, the
large number of patients who have gone back again into their ordinary life and their
previous occupations. Many live in unsuitable homes, and work at occupations
which put a great strain upon them. At the end of last year we obtained grants from
the treasury to enable the authorities to provide apparatus and workshops, and the
rest of it for training purposes as an adjunct to the sanatorium treatment, because a
great many of these cases can not expect to be able again to follow their former occu­
pations; they can not stand the stress of industrial competition, at least for some
years. Whilst there are the sanatoriums we have also provided opportunities for
training in alternative occupations.
This is a very important ingredient in the treatment, because when a large number
of patients have been in the sanatoriums for some time, they want to go home, because,
as they say, “ they have got fed up.” One of the reasons is that they have had no
occupation sufficient ^to interest them. Where you have a well-developed and
properly arranged training system established, it is of enormous benefit in its effect,
and more than that. Where you can have a system whereby men who live in decent
conditions can pursue an alternative occupation, as they are doing in two or three
places now very successfully, in a colony village, there you can get a large percentage
of cases as permanently cured. They help, too, to contribute to their own mainte­
nance. This applies especially to a number of ex-service men who are now under
treatment and training in this form. It is perfectly clear you can not deal with this
question unless you have an authority competent to deal with the whole lot of it. It
is a mistake, I may say in passing, to divide responsibility. Whatever authority you
may set up—and we are working at it now—it will have to be an authority that will
take over the charge of the different parts of the health service, certainly including
that now ordinarily conducted, for the most part, under the poor law.
A further point here is that members of the insurance committees have gathered,
as we know, a great mass of experience, and any committee or authority which adminis­
ters these services will have to call to its aid a number of expert persons from outside,
and to be able to coopt a certain number of persons. We apply that principle in the
housing bill, and we shall certainly have to apply it in respect to the health services.
It is a perfectly reasonable thing that when that time comes we should provide that
members of insurance committees shall be specially nominated and coopted. How­
ever that may be, I accept the principle of securing cooptation on the insurance
committees.
Sir J ohn B u tc h er . I take it this will be a mandatory duty under the new body.
It will not be optional?
Doctor A d d iso n . I can not at present give the precise form, but we stall provide
for the committees acting upon the principle of cooptation. I would not pledge
myself to the words to be proposed hereafter; but the principle I accept. It will be
effectively secured in some way. The insurance committees will have a great deal
to do besides this. The administration of the medical benefit will form a very large
proportion of the work. There is no question at all of insurance committees going
out of existence. It is clear that to transfer this obligation of the societies to the
local authorities we shall require further legislation—which is already in draft; but
it is also clear—and this I should like to say here and now—that that legislation must
involve that the local authorities should not be losers by this transference of respon­
sibility.

Finances of the sanatorium benefit.—Under the 1911 act the in­
surance committees, under the supervision of the commissioners,
handled all the funds of the sanatorium benefit; later a system of
special grants far tuberculosis aid was made by Parliament to the
local authorities and in 1919 the Ministry of Health law placed all
State sanatorium work for tuberculosis in the control of that office.
Under the 1911 act the insurance committees were provided annually
with 15 pence (30.5 cents, par) for each insured person in their
area out of the benefit moneys of the societies, to which was added
1 penny (2 cents, par) out of funds provided by Parliament. Later
the treasury grants were increased and given to the local authorities
for all tuberculosis cases, including the insured persons (the Hobhouse grants). In 1920, therefore, the Ministry of Health had
available for sanatorium benefit of insured persons the 15 pence




24

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

from the national health insurance fund, a grant from the national
treasury, and a grant from the local authorities in each area.
The third report on the insurance system, for 1914-1917, stated
that up to the end of the year 1917, in 32 out of the 49 counties
(excluding London) and in 55 out of the 78 county boroughs of
England, comprehensive agreements were in force Between insur­
ance committees and the local authorities, under which were pro­
vided treatment in approved institutions (residential treatment)
and the services of a dispensary organization for persons in their
homes, the latter including dispensary treatment, the services of a
tuberculosis health officer for examining and reporting on cases, for
giving expert advice as to treatment, etc. Many of the agreements
also provided for the services of a visiting nurse. Progress has
been made in providing institutional facilities in spite of the diffi­
culties which were caused by the war; thus in England in 1914 thenumber of approved dispensaries was 255 and the number of beds
in approved residential institutions was 9,200; in August, 1917, the
dispensaries numbered 370 and the beds 11,700. The progress in
London has been more rapid than that for the rest of the country
because greater facilities were available.
At the time of the enactment of the 1911 law, a special appropria­
tion was inserted in the 1911 finance act, which authorized the ex­
penditure of £1,500,000 ($7,299,750, par) for the construction of
tuberculosis sanatoriums in the four countries, the amount to be
apportioned on the basis of population. It was stated at the time
that similar appropriations for the same purpose would be made
later, but the outbreak of the war postponed such action.
SICKNESS BENEFIT.

This benefit is a cash payment provided while the insured person
is incapable of work by reason of some specific disease or of bodily
or mental disablement, of which notice has been given. The pay­
ments are made, it will be noted, for inability to work, and not
because the member has some illness. The disability must be
proved by the doctor’s certificate, and the benefit is paid until the
doctor certifies that the member is able to resume work. The
maximum period of benefit is 26 weeks, beginning with the fourth
day of incapacity. After the 26 weeks are exhausted, the right to
disablement benefit begins.
When a member has received benefit for one illness, and falls ill
again within 12 months of his recovery, the second illness is regarded
as a continuation of the first; sickness benefit then begins on the
first day of the second illness and may continue until 26 weeks’
benefit ^including those in the first illness) has been paid.
Qualifications.—A person becomes eligible foi4 this benefit when
he has been a member of an approved society (or a deposit contribu­
tor) for 26 weeks and 26 contributions have been paid in respect of
his insurance. As stated later, a lower rate of benefit is paid during
the first two years of membership. Because a certain amount of
supervision of the beneficiary is necessary, no benefit is paid while
the beneficiary is outside of the United Kingdom.
Under certain circumstances even though these conditions have
been fulfilled, sickness benefit may be withheld in whole or in part;
these circumstances include:



25

BENEFITS.

L When the member is in arrears.
2. When the member is in receipt of compensation or damages
in respect of the injury or disease causing the incapacity.
3. When the member is a discharged sailor or soldier in receipt
of a pension for disablement in the highest degree.
4. When the member is an inmate of a workhouse, hospital, etc.
5. When the member has ceased temporarily or permanently to
be insured.
6. When the member is suspended from benefits as a penalty
under the rules of the society.
Rates of benefit—A higher rate of sickness benefit is paid to men
than to women in order to make the benefit approximate the wage
loss of the two groups. A circular of the Ministry of Health, issued
in 1920, gives the following statement of benefits to be paid after
July 5, 1920:
[Shilling at par=24.3 cents; penny=2.03 cents.]

Men.
s. d.

Ordinary rate of sickness benefit................................................................15
Sickness benefit until lapse of 104 weeks from entry into insurance,
and payment of 104 contributions (see section 12 (1) of act of 1918). 9

Women,

0
0

8. d.

12 0
7 6

To show fully the difference in the rates of benefit made by the 1920
act, the following table compares the old rates with those in force
after July 5, 1920:

CHANGES IN RATES OF BENEFIT AND OF CONTRIBUTION INTRODUCED BY THE
ACT OF 1920.
[Source: Ministry of Health. Report by the Government actuary upon the financial provisions of the
national health insurance bill of 1920. London, 1920. Cmd. 612, p. 3. Shilling at par=24.3 cents;
penny=2.03 cents.]
Men.
Item.

Women.

Before After In­ Before After In­
July 5, July 5, crease.
July 5, crease.
1920. 1920.
*
1920.

s. d.
s. d.
s. d.
«. d. a. d.
Benefits:
Sickness, per week....................................................... 10 0 15 0 5 0 7 6 12 0
Disablement, per week................................................ 5 0 7 6 2 6 5 0 7 6
Maternity....................................................................... 30 0 40 0 10 0 30 0 40 0
Annual charge upon insurance funds toward the cost
of:
Medical benefit............................................................. 6 6 9 6 3 0 6 6 9 6
9
9
Sanatorium benefit1...................................................
Weekly contribution:
2
Employer.......................................................................
3
5
3
5
1
4
4
5
3
Insured person............................................................
7
3
9
10
Total........................................................... .............
6

s. d.
4 6
2 6
10 0
3 0
2
1
3

1 The withdrawal of the sanatorium benefit from the act is equivalent to the reduction of liabilities by
9d. (18.3 cents, par) per annum for each insured person.

The benefits provided by the 1920 act represent an increase in the
ordinary rate of 50; per cent for men and 60 per cent for women.
This increase is even greater than these ratios would indicate, because
the contribution rate nas not been increased to quite the same extent.
The total contribution of the employer and employee was increased
from 7d. to lOd. (43 per cent) for men and from 6d. to 9d. (50 per
cent) for women.



2 6

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

At the time the 1920 law was passed a plea was presented for placing
the women’s benefits at the same rate as the men’s. The Minister of
Health stated that this matter had been considered, but as such an
increase of benefit would have to be accompanied by a corresponding
increase of contribution, it was finally decided to maintain the differ­
ence in rates.
What might be regarded as a supplementary benefit is the provision
that no contributions need be paid while the member is in receipt of
sickness or disablement benefit.
Benefits while in arrears of contribution.—It frequently happens that
an employed contributor, on account of unemployment, falls m arrears
of payment of his dues. In such case th& right to benefit does hot
cease at once but the benefits are gradually reduced. As a general
rule 48 weeks of contribution are treated as a full year’s contribution,
so that an insured person always has a leeway of four weeks in each
year. If the unpaid contributions exceed this, then the weekly^sick­
ness benefit is reduced by Is. (24.3 cents, par) for each four weeks of
arrears, with some variation in the case of women’s benefits. As
already stated, arrears do not accumulate while the member is in
receipt of sickness benefit.
In Statutory Rules and Orders No. 1300 of 1921 is given the follow­
ing schedule of reductions in sickness and disablement benefit for the
various stages of arrears, as well as the “penalty rate,” or “ appro­
priate sum, the payment of which will enable an insured person to
keep himself in full standing. It will be recalled that the ordinary
rates for employed contributors are: Sickness benefit, men 15s. ($3.65,
women
disablement benefit, 7£s. ($1.83,par)
f>ar),men and 12s. ($2.92, par); The arrears reduction- schedule is as
or
women alike.
follows:
SCHEDULE OF REDUCTIONS IN BENEFIT FOR ARREARS OF CONTRIBUTIONS: EM­
PLOYED CONTRIBUTORS.
[Source: Statutory Rules and Orders, 1921, No. 1300, national health insurance. Arrears regulations, 1921
dated Aug. 10,1921, p. 14.]
*
Sickness benefit.
Men.
Number of contributions (in­
cluding weeks of sickness).

Reduc­
tion of
Reduc­ rate Reduc­
tion of during tion of
ordinary first 2 ordinary
years
rate.
rate.
of insur­
ance.

45 to 47...........................................
42 to 4 4 ............ ..........................
39 to 41.........................................
36 to 38....... ....I ......................
33 to 3 5 ................. ....................
30 to 3 2 ............................
26 to 2 9 .......................................
i Usually called “arrears penalty,”




Women.

1
2 00
3 0
4 0
5 0
6 00 I
7

s. d.

0 d.60
1
1
2 606
2
3 0

s.

3 6

s. d.
1 0

20
3 0
4
4
5
5

0
0
0
0

Reduc­
tion of
rate
during
first 2
years
of insur­
ance.

0 60
1
1
2 60
2*6
3 0

8. d.

3 6

Disable­
ment
benefit.
Reduc­
tion of
rate of
benefit,
men
and
women.

06
1 60
10
2
2 06
3

s. d.

3 .6

The appropriate
sums to secure full
benefits.!

Men.

1
2 00
3 0
4 0
5 0
6 00
7

Women.

8 . d.

1 00
20

8. d .

f

3
4
4
5
5

0
0
0
0

BENEFITS.

27

SCHEDULE OF REDUCTIONS IN BENEFIT FOR ARREARS OF CONTRIBUTIONS: VOL­
UNTARY CONTRIBUTORS.
[Source: Statutory Rules and Orders, 1921, No. 1300, national health insurance. Arrears regulations. 1921,
dated Aug. 10,1921, p. 15.]
Reduction of rate Reducof sickness bene­ tion-of
fit.
rate of
disable-'
Number of contributions (in­
ment
cluding weeks of sickness).
benefit,
Men. Women. men
and
women.
48 to 49........................................
46 to 47........................................
44 to 45........................................
42 to 43........................................
39 to 41........................................

1 06
6
66
0

s. d.

3
4
7

s.
1 6 0 d.
6
20 26
16
4 0
5 0
6 0 3 06
3

s. d.

In the case of an employed contributor, if the number of contribu­
tions paid is 25 or less, he is suspended from sickness, disablement,
and maternity benefits during the succeeding benefit year.
Behavior during sickness.—^The latest available regulations for the
members who are in receipt of sickness or disablement benefit, those
of April 15, 1919, contain the following provisions:
(1) A member who is incapable of work and is, or may become, entitled to sickness
or disablement benefit in respect of the incapacity—
(а ) Shall obey the instructions of the doctor in attendance and shall answer any
reasonable inquiries by the society as to the instructions given by the doctor;
(б ) Shall not be absent from his place of residence for the time being between the
hours [insert such hours of the evening and morning as may be desired. Different
hours should be inserted for summer and winter], and shall not be absent at any time
without leaving word where he may be found, provided that the society may, if they
think fit, exempt the member from the operation of this rule upon such conditions,
if any, as they may impose;
(c) Shall not leave the locality where he resides without requesting the consent
of the society, which consent shall not be unreasonably withheld and shall be deemed
to have been given unless written notice of objection is given to the member as soon
as possible after receipt of a notification of his intention to leave the locality;
(d ) Shall not be guilty of conduct which is likely to retard his recovery; and
(e) Shall not do any kind of work, domestic or other, unless it be light work for which
no remuneration is, or would ordinarily be payable, or work undertaken primarily
as a definite part of the member’s medical treatment in a hospital, sanatorium, or other
similar institution.
(2) The society may exempt a member from the operation of rule (e) of paragraph
(1) for such time as they may determine in a case where the member has become
incapable of following his usual occupation and is undergoing a course of training with
a view to fitting himself to take up some other occupation.

Sickness and disablement benefits are paid by the approved society
of which the beneficiary is a member; in the case of a deposit con­
tributor, they are paid to him by the insurance committee. On the
production of the doctor’s certificate with the member’s notice of
sickness, an entry in the books of the society is made by its officials.
Within eight days thereafter a second certificate must be filed by the
member and sickness benefit then becomes payable. Each society
must arrange for a sick visiting service, and usually such a visitor is
sent to the member on the production of the notice of sickness. The
benefit is paid at such times as the rules of the society provide and
in many cases the visitors are used to carry the cash to the benefici­
ary. The benefit must be for fractions of a week and usually these




28

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

fractions are one-sixth of the weekly benefit. If the member usually
works on Sundays as well as weekdays, the rules of the society must
specify the method to be followed; as the law fixes the rate of bene­
fit per week, this point is of minor importance. The benefit is con­
tinued until the doctor gives the so-called final certificate, on which
the member must fill out the space for “ declaring off.”
The question .of malingering is one which always arises under a
system of health insurance and one of the duties of the insurance
authorities is to take steps to correct this evil. The 1914-1917 re­
port of the National Health Insurance Joint Committee (Cd. 8890)
contains a statement of the methods used by the Scottish commis­
sion. The report (pi 116) states:

The “ claims experience ” of societies in Scotland is kept under constant observation.
As soon as the necessary information is available for each year, the rates of expenditure
are worked out, and inquiry is made in any case in which these rates appear to be ex­
cessive. In addition, each society, when applying for funds, is required to furnish a
statement showing its expenditure on cash benefits and on administration up to the
last possible date, and from the information thus supplied the commission judge
' whether the society’s rate of expenditure during the year then current is abnormal.
If a society is found to be experiencing an exceptionally heavy drain on its benefit
funds, special inquiry is made into the circumstances. These special inquiries have
generally been followed by a meeting with the executive and officials of the society
concerned, when their methods of administration were fully discussed and suggestions
made'for preventing depletion of the funds by improper claims. The principal sug­
gestions made at these meetings might be grouped under three heads, viz: (1) Careful
scrutiny of claims and of medical certificates; (2) sick visitation; and (3) use of
medical referees.

In most cases the reports of the sick visitors are considered a
sufficient check on the validity of the claim for sickness and disable­
ment benefits. Where the officials of the society have reason to be­
lieve that the period of benefit is being unduly prolonged, the services
of a “ medical referee ” are called for, to prevent malingering. These
referees are usually paid out of the society’s administration expense
account;
i
Some of the societies have made agreements to provide a joint
service of sick visitors and medical referees. In certain areas, such
as London, medical referees have been appointed with the coopera­
tion of the insurance committee, each case examined being paid for
on a fee basis; in London the examination costs 7s. 6d. ($1.88, par)
per case, one-third of which is charged to the society and the remainder
is paid for by the committee. In Bristol the medical practitioners
made it a condition of accepting service under the act that a medical
adviser should be appointed whose sole duty should be to pass on
doubtful cases of incapacity for work. The plan of having ihedical
advisers for the various regions has been under discussion since 1914,
and it is tjie intention o l the Ministry of Health to appoint5such
officers as rapidly as conditions permit. These officers are to be
full-time medical officers, whose duty is principally that of acting
as referee in doubtful cases; they also advise on courses of treatment,
etc., when requested by the practitioners themselves. Their cooper­
ation with the insurance doctors is expected to aid in the maintenance
of an efficient medical service for insured persons.
The appointment of the regional medical staff and other measures
are evidence that the administrative officials are alive to the need of
watchfulness in regard to malingering, always present in both State
and private insurance.




BENEFITS.

29

DISABLEMENT BENEFIT.

The disablement benefit is payable in case of incapacity which
continues after the 26 weeks of sickness benefit are exhausted and
continues as long as the incapacity lasts, but ceases at the age of 70.
It is, therefore, an allowance for invalidity following the sickness
benefit, and if necessary is continued until the old-age pension
begins.
Qualifications.—The number of weeks which must have elapsed
since the member’s entry into insurance is 104, and 104 contributions*
must have been paid.
As in the case of sickness benefit, it is open to an insured person,
who is unemployed or ill, to qualify for disablement benefit by paying
up the necessary arrears himself. The rate at which these contribu­
tions should be paid is the same as in the qualification for sickness
benefit. This qualification is, however, not retrospective in its effect;
that is, the payment of contributions making up the number neces­
sary for qualification will not entitle an insured person to sickness or
disablement benefit for a period prior to the date of such payment.
Thus if a person has paid no contributions for 13 weeks he may secure
full benefits for the 13 weeks by paying the arrears penalty (see p. 26),
but he may secure sicknesgior disablement benefit after the date of
his payment.
: '
In general, the other details of right to disablement benefit are the
same as for sickness benefit.
Rate of benefit.—The benefit is the same amount for men and women
alike. Payment begins the day after sickness benefit is exhausted
and continues as long as the member is rendered incapable of work
by a specific disease or bodily or mental disablement. It is a weekly
payment of 7s. 6d. ($1.83, par)—that is, one-half of the maximum
sickness benefit.
In case of arrears of contribution, the benefit is reduced by 6d.
(12.2 cents, par) for each four weeks of arrears. The table on page 26
shows the benefit rates and the arrears penalty rates for men and
for women.
The rates just given are those provided by the act of 1920; before
the passage of that act the rates were 5s. ($1.22, par) per week for
men and women alike. The new law thus increases the benefit by
50 per cent.
MATERNITY BENEFIT.

General features.—One of the most involved features of the insur­
ance system is the maternity benefit. Briefly stated, it is a lump­
sum payment of either 40 or 80 shillings ($9.73 or $19.47, par) on
the birth of a child. Prior to 1920 the amount of benefit was 30 or
60 shillings ($7.30 or $14.60, par). The 40-shilling benefit is paid in
respect oi a man’s insurance, the benefit being the property of his
wife. The 80-shilling benefit is paid to an insured married woman,
though this statement is not entirely complete, as will be explained
later. The benefit does not include medical attendance, and sick­
ness benefit may not be paid for the four weeks following the date of
childbirth unless the sickness is due to a cause not connected, directly
or indirectly, with the confinement.

104936°—23—Bull. 312-----3




30

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

In explaining the reason for including the maternity benefit, Mr.
Lloyd George made the following statement:

We have, a provision for maternity, an allowance of 30 shillings, which I think is
one of the most valuable provisions in the bill, and We are going to see that the money
is spent for the purpose for which it is designed, in spite of one or two protests we have
had from friendly societies. The money is meant for the mothef, to help her in dis­
charging the sacred function of motherhood by proper treatment, fair play, so as to
put an end to the disgraceful infantile mortality of this country.2

Great Britain, like a number of the States of the United States,
had prohibited the employment of women in industrial establishments
for a period of four weeks after childbirth, and this law, enacted in
1891, is still in force. One of the main arguments against such a
law is the fact that it prevents a wage^eaming mother from securing
an income at a period when her expenses are higher thaiv usual, and
does this in her own and the child’s interest, but at the same time it
offers no substitute. It was hoped to ameliorate this condition by
the provision of the maternity benefit and by making its payment
conditional on the beneficiary abstaining from remunerative employ­
ment for a period of four weeks.
The law originally intended that the* mother should have the
woman’s sickness benefit of 7s. 6d. ($1.83, par) for a period of four
weeks following confinement, making 30s. ($7.30, par) for the period.

This amount had been used.as a childbirth benefit for a long period
of years by the Hearts of Oak Friendly Society, and was therefore a
benefit to which the members of friendly societies were accustomed.
The amount of 30s* benefit is smaller that that provided by the
German insurance code of 1911 {half wages for eight weeks, with
additional nursing benefit) and the French law of 1913 (one-half to
1£ francs (9.7 to 29 cents, par) daily for eight weeks, with additional
nursing benefit), but this comparison is of course no longer valid in
view of the increase in benefit to a possible 80 shillings ($19.47, par).

Waiting period and other qualifications.—Prior to July 1, 1918, the
maternity benefit’became available after awaiting period of 26 weeks,
but the law of 1918 changed this to 42 weeks, or approximately 10
months. The departmental committee on approved society finance
and administration in its report of 1916 (Cd. 8396) had recommended
that the period be made 52 weeks for both male and female members,
in order to prevent any exploitation of this feature of the insurance,
but Parliament reduced this term to 42 weeks.

The insured woman’s benefit carries with it the obligation to abstain
from remunerative work for a period of four weeks after the date of
childbirth, with the penalty of a fine for infraction of this rule.
Every approved society and insurance committee is required to estab­
lish rules on this subject, arid these rules must be ratified by the
higher insurance authorities.

The second 40-shilling benefit, paid by the wife’s society, is not
subject to the qualifications attached to the payment of the sickness
benefit; that is, it may be payable even though trie woman member
has been suspended froin sickness benefit on account of arrears or
has already exhausted: the full 26 weeks for which sickness benefit
is payable. Similarly, the payment of the second maternity benefit*
will not count as the payment of four weeks’ sickness benefit for the
purpose of determining when the right to 26 weeks’ sickness benefit
——“ “

1 f;

11." ■■

* The People’s Insurance, by bavid Lloyd George. London, 1912, p. 183.




;

C

..................”

-», 4 ,

BENEFITS.

31

is exhausted. In the same manner, if the father dies before the
child is born, his insurance is regarded as having continued up to the
date of confinement and the fact that his dues have not been paid
after his death is disregarded.
As the insured married woman generally receives 40s. of the 80s.
benefit from her husband’s society, it was necessary to make pro­
vision that the maternity benefit should be paid even if the husband
was in arrears or for other reasons disqualified in his membership
rights; otherwise the wife would be in a less favorable position than
if her husband was not insured at all. It was provided, therefore,
that when the insured husband is disqualified, the wife’s society
must pay the entire 80s.
To obtain the maternity benefit in respect of the husband’s
insurance, proof of marriage in the form or a marriage certificate
must be produced, and in the same way the wife’s society must have
similar proof before paying the second 40s. benefit. One benefit may
be paid by the wife’s society without the certificate, since an insured
woman is entitled to the benefit even if not married. These certifi­
cates are supplied by the registrar at a cost of Is. (24.3 cents, par).
If an insured woman gives up her employment on marriage, she
retains her right to the maternity benefit for two years from the date
of ceasing to oe an employed contributor.
An insured woman is required to give formal notice of her mar­
riage, to her society within eight weeks of the date thereof; if the
society has not been so notified and pays to her benefits to which she
is not entitled, it may deduct the excess amount so paid from the
amount of any benefit subsequently payable to her.
Rate of benefit.—The basic amount of the maternity benefit, prior
to July, 1920, was 30s. ($7.30, par); the act of 1920 raised this to
40s. ($9.73, par). It is paid in respect of a man’s insurance and is
the wife’s property. If the wife is also an employed contributor,
then her insurance entitles her to another lump-sum payment of 40s.
from her society, making 80s. ($19.47, par) in all. Husband and
wife may, and often do, belong to the same society.
As a rule, the husband of an insured wage-earning woman will
also be an insured person; to simplify the'matter, the law provides
that an insured married woman shall have 80s. regardless of whether
her husband is insured; if he is not insured, or if insured is not quali­
fied for some reason (arrears, etc.), the wife’s society pays the entire
80s.
An unmarried insured woman is entitled to a maternity benefit
of 40s. ($9.73, par) from her society.
What may be regarded as a supplementary benefit is the provision
of section 10 (4) of the act of 1911, under which no account is taken
of arrears of contributions accruing during the two weeks before and
the four weeks after the date of childbirth in the case of a married
woman who is herself insured. Such a member is therefore exempt
from the payment of dues for a period of six weeks.
To show the relation of the husband’s society and the wife’s
society in respect to the payment of the maternity benefit, the official
Handbook for Approved Societies gives the following schedule.
This volume was published in 1915 and the rates therefore are not
now in use, but the schedule illustrates the relation between the two
societies.



32

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN,

SCHEDULE OF OBLIGATIONS OF APPROVED SOCIETIES OF GREAT BRITAIN FOR
BENEFITS UNDER NATIONAL INSURANCE ACTS, IN RESPECT OF INSURED MAR­
RIED MEMBERS.
!
[Source: Great Britain, national insurance acts. Handbook for the Use of Approved Societies. English
edition, London, 1915, pp. Ill, 112. The benefits shown in this schedule are not now in use.]

Part I. For use by husband’s society.

Husband’s society pays 30s. ($7.30) if husband is a
British subject, or if wife was before marriage a
British subject; £1 3s. 4d. ($5.68) if he is an
alien aiid his wife was before marriage an alien.
B. Husband insured, but not qualified for benefit.. Husband’s society pays nothing.

A. Husband insured, and qualified for benefit

Part II. For use by wife's society.
A.
B.
*

Wife an employed contributor, but not qualified Wife’s society pays nothing.
:for benefit.
Wife an employed contributor and qualified for
benefit.
Then,if—
(1) Husband is also insured, and qualified.. Wife’s society pays 30s. ($7.30), or 18s. ($4.38) if
husband is an alien and Wife was an alien before
marriage.
(2) Husband is alsa insured, but not quali­ Wife’s society pays 60s! ($14.60), or 36s. ($8.76) if
fied.
husband is, an alien and wife was an alien before
marriage.
(3) Husband is not an insured person......... Wife’s society pays 60s. ($14.60), or 36s. ($8.76) if
husband is an alien and wife was an mien before
marriage.
(4) Husband is a deposit contributor, but Wife’s society pays—
the amount standing to his credit is If the husband is a British subject, or if the wife
not enough to provide full benefit;
was before marriage a British subject, 30s.
i. e.. 30s. ($7.30) or £1 3s. 4d. ($5.68),
($7.30) at once, and, when they know the sum
as above.
available from the husband’s credit, so much
more as will, together with that sum, make up
a further 30s. ($7.30).
If the husband is an alien, and the wife was be­
fore marriage an alien, 18s. ($4.38) at once, and,
when they know the sum available from the
husband’s credit, so much more (if any) as is
required, together with that sum, to make up
a further 18s. ($4.38).

ADDITIONAL BENEFITS.

With the approval of the Ministry of Health, the benefits just
described may he increased or certain other benefits, called “ addi­
tional” benefits, may be provided by an approved society. This
approval is conditional on the financial status of the society, and as
the results of the first valuation have not yet been completely deter­
mined these additional benefits have not yet been provided. For
such societies as show a surplus, authority is given to provide the
benefits specified.
The list of these benefits is given in the fourth schedule of the act
of 1911. Section 37 of that act provides that no surplus or part of a
surplus of a society shall be used for a death benefit and that only
the benefits indicated in the following list shall be provided :

1. Medical treatment and attendance for any persons dependent upon the labor
of a member.
2. The payment of the whole or any part of the cost of dental treatment.
3. An increase of sickness benefit or disablement benefit in the case either of all
members of the society or of such of them as have any children or any specified number
of children wholly or impart dependent upon them.
4. Payment of sickness benefit from the first, second, or third day after the com­
mencement of the disease or disablement.
5. The payment of a disablement allowance to members though not totally incapable
of work.




BENEFITS.

33

6. An increase of maternity benefit.
7. Allowances to a member during convalescence from some disease or disablement
in respect of which sickness benefit or disablement benefit has been payable.
8. The building or leasing of premises suitable for convalescent homes and the
maintenance of such homes.
9. The payment of pensions or superannuation allowances whether by way of addi­
tion to old-age pensions under the old age pensions act, 1908, or otherwise.
10. The payment, subject to the prescribed conditions, of contributions to superan­
nuation funds in which the members are interested.
11. Payments to members who are in want or distress, including the remission of
arrears whenever such arrears may have become due.
12. Payments for the personal use of a member who, by reason of being an inmate
of a hospital or other institution, is not in receipt of sickness benefit or disablement
benefit.
13. Payments to members not allowed to attend work on account of infection.
14. Repayment of the whole or any part of contributions thereafter payable under
Part I of this act by members of the society or any class thereof.
15. Such other additional benefits being of the same character as any of those
hereinbefore mentioned as may be prescribed.

Section 15 of the act of 1920 authorized the National Health
Insurance Joint Committee to specify the form of the benefits to be
allowed under the terms of clause 15 above. In February, 1921, the
following draft of an order was published as indicating the views of
the insurance authorities. Under this order the schedule quoted
above would have added to it the following:

15. The payment of the whole or any part of the cost of maintenance and treatment
of members in a hospital or convalescent home, and the payment of part of the travel­
ing expenses incurred by members in traveling to or from the hospital or convalescent
home.
16. The payment of the whole or part of the cost of medical and surgical appli­
ances, other than those provided as part of medical benefit.
17. The payment of the whole or any part of the cost of optical treatment and
appliances.
18. The payment of the whole or any part of the cost of the provision of nurses for
members.

The preliminary report on the first valuation, referred to later in
the description of the actuarial aspects of the system, states that “in
the case of a large number of insured persons the disposable surplus
permits of an additional sickness benefit of 5s. [$1.22, par] a week
with corresponding additions to the other money benefits/7 It
seems clear, therefore, that in the near future the great majority of
insured persons will receive additional* benefits under one or more
of the clauses given above.
MISCELLANEOUS BENEFIT FEATURES.

Mercantile marine.—Because of special conditions prevailing in
certain industries only reduced benefits are paid and correspondingly
lower contributions required. Thus a seaman must be maintained
by the shipowner while the man is disabled, and medical attendance
must be provided. During such incapacity the society of which the
seaman is a member pays him no sickness benefit; the society also
does not count any such sickness in computing the 26 weeks for which
benefit may be paid. The contributions are 8d. and 7d. (16.2 cents
and 14.2 cents, par) for men and women, respectively.
If, however, the seaman has dependents and his employer is not
liable for wages, the society may pay the sick benefit in whole or in
part to the dependents.




34

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

Married women.—The provisions relating to an insured woman
who marries and gives up her employment are rather involved and
arise .partly from the fact that her contributions have established a
certain credit to her account and partly from the desire of the law­
makers to give her special advantages. The woman member must
give notice of her marriage within eight weeks and her society will
then provide her with a special circulai* specifying her rights. The
general rule is that as soon as a married woman has been out of em­
ployment for eight weeks in the year following the date of her mar­
riage she is automatically transferred to the special married women’s
class, “ Class K.” When an insured woman keeps on with her
remunerative employment for a year after marriage, hut then
becomes “unemployed” within the terms of the law, she is treated
as the usual contributor and is given the “free year” described
below.

The special benefits to which “ Class K ” women are entitled are
as follows:
”
1. ■Sibkhess benefit, subject to th6 norm&l conditions as to proof of
inability to work, for six weeks during the year following the date of
giving'up work. The 1920 &ct tis&s tlie words “ sickness or disable­
ment benefit” and the rate is made 7s. 6d. ($1.83, par) weekly
instead of the 5s. ($1.22, par) provided by the 1918 act. If the
member is entitled to disablement benefit, she may therefore receive
it for the full six weeks even if she has already exhausted her right
to sickness benefit.
2. Maternity benefit of 40s. ($9.73, par) on her first confinement
after marriage, if it occurs within two years after the date of mar­
riage; this is additional to any benefit she may receive in respect of
her husband’s insurance.
3. Medical benefit for one year from the date of her transfer to
“Class K” plus the period up to either June 30 or December 31
following the end of the year, whichever comes first.
The “free year’s ” benefit.—Under the 1918 act the position of k
person who,has ceased to be insured is as follows: He will remain an
insured parson in exactly the same position as he was at the titne he
ceased to be insured for a period of one year. If he was in full stand­
ing, all the benefits must be paid him; if he was in arrears, the
reduced benefits must be paid him, though of course he is entitled
to medical benefit in full. This is usually referred to as the “free
year’s insurance.” It is applicable regardless of the cause of ceasing
to be an employed contributor, whether it is due to inability to find
work, increase of income beyond the £250 ($1,217, par) limit, takihg
up employment not included under the laws, etc.
After this year has expired anyone who later desires or is required
to enter insurance again is treated as if he were an entirely new
applicant—e. g., his benefits are smaller for the first 104 weeks, he
must comply with new waiting periods, etc.
The voluntary contributor whose employment is not manual and
whose income exceeds £250 ($1,217, par) is not entitled to medical
benefit.
Inmates of institutions—A person who is an inmate of any workhouse, hospital, asylum, convalescent home, sanatorium, or similar
institution, supported by public funds or by charitable contributions,




SOURCES OF INCOME.

35

may not receive benefits directly. Instead, these may be paid to his
dependents, or if he so authorizes, be paid for his benefit, as for the
rent of his house, or be paid with his consent to the institution. If
there is a balance after these possible payments have been made,
it is paid to him on leaving the institution.
SOURCES OF INCOME.
The means for defraying the cost of the insurance system are
secured from three sources—first, contributions of the insured
person; second, contributions of the employer of the insured person;
third, grants from the national treasury.
For the great majority of the insured persons, the “ employed
contributors,” the weekly rate of contribution is now lOd. (20.3
cents, par) for men and 9d. (18.3 cents, par) for women. In the case
of-men the insured person and his employer each pays half; in the
case of women the insured person pays four-ninths and her employer
pays five-ninths. The employer thus pays the same amount in both
cases, so that as far as the insurance is concerned there is no reason
for the employer to prefer women as against men. In the case of
insured persons receiving low wages—less than 4s. (97.3 cents,
par) per day—the employer’s proportion is even higher.
When the act of 1911 came into force the men’s rate at that time
of 3d. (6.1 cents, par) for the employer might be taken, on a rough
approximation, as 1 per cent of wages. Thus the Abstract of Labor
Statistics, seventeenth issue, published in 1915, gives on pages 48
to 63* a large number of rates of wages ranging from 20s. to 50s.
($4.87 to $12.17, par) per week. If 25s. ($6.08, par) be rather
arbitrarily assumed to be one of the most frequent rates, this would
make the proportion about 1 per cent of wages for the employer
and 1£ per cent for the insured man.
GOVERNMENT GRANTS.

The amounts provided by the National Government fall under two
heads. In the first place, the Government adds, two-ninths to each
contribution paid in respect of an insured person, men and women
alike. Secondly, the Government makes a number of appropriations
for specific purposes, which will be described later. The proportion
of the total income which the Government pays is very difficult to
state; but if one is permitted to make a very crude estimate, it may
be placed at 25 per cent, though even this statement is made with
many reservations.
.
The second group of grants from the national treasury will be
described in connection with the financial administration of the
system. In general these are: For purposes of the medical benefit,
about £3,100,000 ($15,086,150, par) in 1919; for the women’s
equalization fund, to defray extra expenditure caused by disability
due to childbearing, etc., about £280,000 ($1,362,620, par); for the
central fund, to meet abnormal rates of sickness, £150,000 ($729,975,
par). The actuaries.who prepared the estimates of expenditure for
benefits under the 1920 act expressed the opinion that the national
appropriations would defray slightly over 25 per cent of this expendi­
ture, without including any sums for sanatorium benefit.



36

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

CONTRIBUTIONS.

The contributions are weekly dues paid jointly by the employer
and the insured person. By far the greater part of the insured popu­
lation pay at the so-called ordinary employed rate; in the effort
to adjust the system to the conditions prevailing in certain occupa­
tions or industries special rates of contribution are provided for
these groups. Except in the case of the merchant marine these
rates are of minor importance as far as the number of persons insured
under them is concerned.
Contributions are not paid during the receipt of sickness or disable­
ment benefit and, in the case of women, during receipt of maternity
benefit.

If, however, an employee holds a certificate of exemption-from
insurance, his employer must nevertheless pay the contribution which
would have fallen to his share had the employee not been exempt.
Ordinary mte.—Under the act of 1920,the total ordinary employed
rate of weekly contribution for both employer and employee is lOd.
(20.3 cents, par) for men and 9d. (18.3 cents, par) for women, the
employer paying 5d. (10.1 cents, par) of these amounts in each case,
the male employees 5d., and the female employees, 4d. (8.1 cents, par) .
Low-wage earners —In certain employments, where the rate of
wages is lower than that of the great majority of insured persons, a
special system of contributions is provided. As the law states it:

In the case of employed contributors of either sex, of the age of 18 or upward,
whose remuneration does not include the provision of board and lodging by their
employer, and the rate of Whose remuneration does not exceed 4s. (97.3 cents/par)
a working day, the following shall be the rates of contribution:
V
Where the rate of r e m u n e r a t i o n does not exceed 3s. (73 cents, par) a working day—
To be paid by.the employer—for men, lOd. (20.3 cents, par) a week; for women,
9d. (18.3 cents, par) a week.
,
Where the rate of remuneration exceeds 3s. but does not exceed 4s. (97.3 cents, par)
a working day—
To be paid by the employer, 6d. (12.2 cents, par) a week.
To be paid by the contributor—men, 4d. (8.1 cents, par) a week; women, 3d.
(6.1 cents, par) a-week. ;
; .
f .

These rates for low-wage earners are a distinct modification erf: the
rates existing prior tp July 5, 1920. Under the act^of 1911 the low-*
Wage earners were men earning 2s. 6d. (60.8 cents, par) per day or less
and women earning 2s. (48.7 cents, par) a day or less-^both being
21 years of age or over. The rates for these groups were:
j Weekly rates for low-wage earners 'prior to July -5, 1920.-r-Group
I (Wage not exceeding Is. 6d. (36.5 cents, par) per working day):
The employer paid 6d. (12.2 cents, par) for men, 5d. (10.1cents, par)
for women, and Parliament provided Id. (2 cents, par) in each case.
The insured paid nothing.
i ;
Group II (remuneration over Is. 6d. but not exceeding 2s.j (48.7
cents, par) per working day): The employer paid 5d. for nien and 4d.
(8.1 cents, par) for women, the insured paid Id. in each case,' and
Parliament provided Id. in each case.
t
Group III (remuneration over 2s., but not exceeding 2s. 6d.
(60.8 cents, par) per working day): The employer paid 4d. (8.1
cento, par) for men, 3d. (6.1 cents, par) for women, while the insured
paid 3d. in each case. For the women these rates were the same as
the ordinary employed rates.




fcotracES o p m c o M E .

37

Mercantile marine.—The position of men and women employed in
the mercantile marine (seamen) is affected by the navigation laws,
which require the shipowner to provide sickness care and maintenance
during service on board ship. The contributions to be paid in the
case of “foreign-going” seamen are 2d. (4.1 cents, par) less than the
rates for the usual employed contributors—that is, the employer and
the seaman each pay Id. (2 cents, par) less.
The men and women employed in coastwise trade (“ home trade ”)
are practically in the position of regular contributors.
Special groups.—Persons who are in the service of more than one
employer m any calendar week have their contributions paid by the
first employer of the week. In the case of persons who take home
work to be done (“ outworkers”), the insurance authorities may per­
mit contributions to be paid on the basis of work actually done, and
for this purpose they have issued a long series of regulations applying
to specific trades and to particular localities. The usual method is
for the employer to fill out a blank form giving information as to the
industry, the employee, etc. ; if this statement is satisfactory permis­
sion is granted to pay contributions for each “ unit of work” instead
of for each week of employment.
Persons intermittently employed must have employment for at
least 40 weeks a year for every two successive years m order to main­
tain their status as employed contributors. They may not retain
their membership by paying the ordinary “ arrears penalty,” but must
have themselves enrolled as voluntary contributors and pay the full
rate if their employment is less than the 40 weeks because of such
intermittent employment.
It will be noted that the rates of contribution are level or “flat”
rates—that is, uniform for all persons in a group regardless of their
ages. The plan used in some insurance systems of making the rates
a percentage of wages was not adopted for the British system.

ARREARS.

The schedule on page 26 shows the rate of reduction of sickness
and disablement benefit while the member is in arrears of contribu­
tion. The system provides for a special plan of payments by the
member to restore himself to full benefit; this plan, however, restricts
the right to temporary periods of genuine unemployment, and a mem­
ber who is in an intermittent employment, or who frequently takes
up temporary employment, may not receive the advantage of this
special rate.
The original plan for extinguishing arrears permitted the insured
person to retain his full rights by paying his own share (but not his
employer's) of the regular contribution. Under the act of 1918 this
right was withdrawn, and since 1918 a system of lump-sum payments,
entitled “ arrears penalty,” has been in use. The amount of these
cash payments is given in the table on page 26. These payments
amount in the case of men to Is. (24.3 cents, par) for each four weeks
of arrears; as the man's contribution is 5d. (10.1 cents, par) per week,
four weeks'payments would be 20d. (40.6 cents, par), so that the Is.
payment means a substantial reduction in such cases. For women,
the arrears penalty is 6d. (12.2 cents, par) for each four weeks, mak­
ing the advantage even greater.



38

NATIONAL HEALTH INSURANCE IN. GREAT BRITAIN.

The arrears for any contribution year are extinguished in the cor­
responding benefit year, even though no benefit is paid, so that the
member makes a fresh start each year. Each member’s account is
made up at the end of each contribution year; contribution cards are
issued the first part of January and the first part of July, and each
year begins with the first Monday in July. As stated before, full
benefits are payable if not less than 48 contributions are credited for
the contribution year. When the number paid falls short of 48, the
member is liable to suffer reduction or suspension of benefits for the
whole of the following benefit year unless he pays within the so-called
“ period of grace ” the arrears penalty already referred to. The period
of grace ordinarily runs to the end of October after the close of the
contribution year.
FINANCIAL ADMINISTRATION.

ACTUARIAL BASIS OF THE SYSTEM.

The basis used in computing the rates of contribution for defraying
the cost of the sickness and disablement benefit was the experience
of the Manchester Unity of Odd Fellows, 1893-1897. This is the
largest of the English friendly societies, and includes a wide variety
of occupations among its members. The actuaries employed by the
Government weighted the data of this body of experience to make it
conform to the characteristics of the general population; the factors
requiring adjustment were the occupational, the age distribution, the
marriage rate, the birth rate, etc. The Manchester Unity experience,
as tabulated, included only male lives, and in the absence of any
reliable information as to women’s experience, the actuaries decided
to use the figures for male lives in establishing the women’s rates of
contribution, though the men’s rates were “loaded” to protect the
funds. Later experience proved, however, that the loading had not
been sufficient to carry the higher cost of women’s benefits.
To verify the elaborate tables of the Manchester Unity experience
the following comparison was made of the sickness rates of a number
of friendly societies for periods prior to the year 1900.
COMPARISON OF RATES OF SICKNESS AMONG MALES AS SHOWN BY VARIOUS
EXPERIENCES.
[Source: Report of the actuaries in relation to the scheme of insurance against sickness, disablement, etc.,
embodied in the national insurance bill, 1911. London, 1911. Cd. 5681, p. 15.]
Weeks of sickness per annum per member.
Age group.

Manchester
Unity,
1866-1870.

Ancient
Order of
Foresters,
1871-1875.

Friendly
societies,
1876-1880.

Manchester
Unity,
1893-1897.

16 to 19.......................
20 to 24.......................
25 to 29.......................
30 to 34.......................
35 to 39.......................
40 to 44.......................
45 to 49.......................
50 to 54.......................
55 to 59.......................
60 to 64.......................
65 to 69.......................

0.54
.75
.81
.93
1.06
1.26
1.64
2.22
3.05
4.72
7.24

1.04
.82
.85
.97
1.15
1.37
1.71
2.27
3.21
4.59
7.97

0.88
.85
.87
1.02
1.24
1.47
1.89
2.39
3.36
5.17
8.73

0.92
.90
.95
1.06
1.27
1.58
1.99
2.75
4.02
6.31
10.59




FINANCIAL ADMINISTRATION.

39

The actuaries place special emphasis on the fact that for practically
the whole period for which information is available, there had been
a steady increase in the average rate of sickness. As their report
expresses the matter:

An important result of this investigation was to show that a steady increase in the
average rate of sickness among male fives at all ages had been taking pl&ce for many
years previously. (Cd. 5681, p. 15.)

In the report of the operations of the system for 1913-14 (Cd.
7496, p. 60) this point is again referred to in another aspect:

It would appear from statements that have been made that the rate of sickness
among the older friendly societies has risen considerably since the act came into
operation, and that material excess over the provision made for the sickness claims
in the voluntary contributions and reserves of the societies is being experienced. On
the act side, however, the claims on the majority of these societies appear on the
whole to fee within the actuarial provision.

Apparently any system of health insurance, whether State or pri­
vate, must include this factor as an element of cost in computing its
income. According to the latter of the above quotations, the private
insurance system had experienced the usual increase in cost, while in
the State system it had not yet come into operation.
On the basis of the Manchester Unity tables, a system of flat rates
or level premiums was worked Out and was applied to the whole
insured membership. If such a flat-rate schedule of charges is placed
on the whole number of insured persons, the inequalities of occupa­
tional, age, sex, etc., risks will be of slight importance because of the
operation of the law of average; the favorable and the unfavorable
factors together will produce an aggregate result which in a large
number of cases can be readily approximated. The essential point
to be emphasized is that such a flat-rate system needs as carriers
organizations containing large numbers of persons with a wide
variety of risks in order to equalize these variations.
^
> The plan adopted for the organization of the carriers of the British
system, howeverdid not comply with this requirement. The in­
sured persons were permitted, and in fact encouraged, to segregate
themselves into societies which in many cases were comparatively
small in numbers and which did not contain a variety of risks—many
of them even concentrated good or poor risks in one group, as in the
case of certain 'trade-unions. Thus it was well known that certain
groups df agricultural workers had rates of sickness much lower than
the average, while other groups, such as miners, had rates in excess
of the computed average. The trade-union societies, for instance,
have recommended that plans be prepared for the nationalization of
assets and liabilities “ to secure for unhealthy and. dangerous occupa­
tions the full benefits of national health insurance.”3
Under this system of flat-rate contributions, with the membership
divided into groups which do not afford an equal distribution of risks,
there are four factors to be provided for, m order to secure some
measure of equalization:
1. The age distribution of the membership; this is eared for by the
system of “ reserve values.”
!f
2. The probability of an excess of liabilities;3or deficiency on valua­
tion, of a society due to expenditures for benefit being in excess
of the expected; this is provided for by the contingencies fund.
3 The National Insurance Gazette. London. February 7, 1920, p. 68.




40

NATIONAL HEALTH INSURANCE IN GREAT BRITAIN.

3. The probability of a deficiency on valuation caused by abnormal
rates of sickness due to the nature of the occupation of the members,
or the environment in which they live, or an epidemic such as in­
fluenza, or some other cause beyond the controf of the society; this
is provided-for by the central fund.
4<f Th§ fapt’^ a t women, especially married women, have a high
rate of disability, principally on account of childbearing. This is
oared for by the women’s equalization fund.
RESERVE VALUES.

The earliest age of admission to the insurance is 16, and as all
persons dyer this age pay the same contributions, there is danger
either of loss to the system or of making the younger ages pay the
benefits of the older. To obviate this danger, the system called
“ reserve values ” has been created and a set of tables prepared to
show the capital sum which must be provided to meet the loss on
the .benefits of the ages over 16.
:Whenever a person of the age of 17 or over joins a,society ttm min­
istry at once makes to that society a theoretical loan—in other
words, gives it a credit—of an, amount equal to the capital sum
stated in the reserve values table to be necessary to offset thedoss
caused by the higher age of that member. This credit involves the
payment by the society of 3 per cent interest. >
The credit is to be redeemed by having the authorities withhold
from each weekly contribution a certain sum which will pay the inter­
est and eventually cancel the capital sum., Originally it was expected
that the reserve values would be repaid by 1932,. but later changes
have postponed this date to about 1955.
'
r
o
Under the act of 1920 the amount of the weekly contributions to
be applied to the reserve values fund (or sinking fund, as it is frer
quently called) will be ljd. *(2.7 cents, par) in the case of men and
1-^d. (2.9 cents, pax) in the case of women. It is estimated: that these?
deductions will be sufficient to Complete the redemption M about 35
years from 1920. In 1912 the amount of the reserve values to be re­
deemed was placed at £87,000,000 ($423,38-5,500, par)i in July/ 1920,
the unredeemed reserve values were about ^65>900y0QOd[$316,3^2^500,
par). The law of 1920 added about £45,000,000 ($21%B92^00,» par),
to the reserve values, making the total: about £11G$W,OO0 ($635,?
315,000, par) , Under the rates of deductions provided by the 1920
law, the aggregate income available in the first yean wifi amount to
about £4,800,000 ($23,359,200, par), of which £3,300,000 ($16,059,^
450, par) will be required for interest, leaving £1,500*000 ($7,299,750,
par) for reduction of the principal.
,
The history pf these deductions is of interest. The act of 1911
provided that thexates of deduction should be, in the case of mem
lid. (3.2 cents, par)*; in the case of women, lid.?(3 cents, par)^
These deductions it had been estimated would redeem the reserve
values in about .18 years. _ The departmental committee of 1916
recommended, since the contributions seemed inadequate in certain
respects, that a part sof these deductions should be diverted to the
two special funds described below* This meant a diversion of sinking
fund moneys for more or less immediate purposes, and a delay in the
final cancellation of the reserve values from 1932 to 1938. The de­



41

FINANCIAL ADMINISTRATION.

ductions made for the two special funds left the amount as follows:
In the case of men, l|d. (2.3 cents, par); in the case of women,
l£d. (2,4 cents, par).
With the deductions at these rates, the following table was prethe
the system;
reserve
are no
!>ared by force,actuaries ofthe tables for these1920 ratesvalues not yet
onger in
but, since
the
have
been published, they show the method used.
RESERVE VALUES.IN RESPECT OF EMPLOYED CONTRIBUTORS WHO ENTERED INTO
INSURANCE AFTER OCTOBER 12, 1913, UNDER THE AGE OF 69. (SUPERSEDED BY
ACT OF 1920.)
[Source: Reserve and Transfer Regulations, 1918. Second schedule. £ at par=$4.8665; shilling=24.3
cents\ penny= 2.03 cents.]
Age next
birthday at
, entry into
insurance,

Reserve values.
Men.

Spinsters
and
widows.

£ s. d.
£ s. d.
17
.......
0 6 6
18................... • 0 10 0
0 10 6
1 9 ................ 0 17 0
0 14 0
1 4 0
20...................
0 17 0
1 11 0
21...................
1 0 0
1 18 0
22................
1 3 0
23................... 2 4 6
6
1 5 6
2 4 ................ 2 10
1 8 6
25,................. 2 16 0
1 11 6
26................... 3 1 6
1 15 0
27................... 3 7 0
1 19 6
28................... 3 12 0
2 4 6
3 17 0
29............
30.................... 4 2 0 . 2 10 0
2 16 6
31................... 4 7 0
3 3 0
4 12 0
32...................
3 10
4 17 0
33...................
3 17 6
5 2 0
34...................
4 5 6
5 7 0
35.............. .
4 13 6
36.................... 5 12 0
5 1 6
37.................... 5 17 6
5 9 6
38.................... 6 3 6
5 17 6
39.................... 6 9 0
6 6 0
40.................... 6 15 0
6 14 0
7 1 0
41...................
7 2 0
42.................... 7 .7 0
7 10 0
43.................... 7 13 0

Married
women.
£ «. d.
7 10 6
7 4 6
6 16 6
6 9 0
6 3 6
5 19 6
5 17 0
5 15 6
5 14 6
5 14 6
5 15 0
5 16 0
5 17 6
5 19 6
6 1 6
6 3 6
6 6 0
6 9 0
6 12 0
6 15 6
6 19 0
7 3 0
7 7 0
7 11 6
7 16 0
8 1 0
8 6 6

Reserve values.

Age next
birthday at
entry into
insurance.

Men.

44....................
4 5 .................
46...................
47....................
48.............. .
49............L...
50....................
51...................
52...................
53...................
54...................
55....... :..........
56..................;
57...................
58;..................
59....................
60....................
61....................
62....................
63....................
64....................
65...................
66....................
67...................
68....................
69....................

£ s. d .
7 19 6
8 5 6
8 12 0
8 18 0
9 4 0
9 9 6
9 14 6
9 19 6
10 3 6
10 6 6
10 9 0
10 10 6
10 10 6
10 8 6
10 5 0
9 19 0
9 10 6
8 19 0
8 5 6
7 10 0
6 12 0
5 12 0
4 10 0
3 6 6
2 3 6
1 12 0

THE CONTINGENCIES FUND.

Spinsters
and
w id o w s.

£ 8. d.
7 17 6

8 5
8 13
9 0
9 6
9 13
9 18
10 3
10 7
10 11
10 13
10 14
10 14
10 12
10 7
10 1
9 12
9 0
8 6
7 9
6 11
5 12
4 10
3 8
2 6
1 16

6
0
0
6
0
6
6
6
0
0
6
0
0
6
0
0
0
0
6
6
0
6
0
6
0

Married
women.
£ 5 d.
8 12 6
8 18 0
9 4 0
9 10 0
9 15 6
10 1 0
10 5 6
10 9 6
10 13 0
10 15
10 17 0
10 17 6
10 16 6
10 14
10 9
10 2 6
9 13 0
9 1 0
8 6 6
7 10 0
6 12
5 12 0
4 10 6
3 8
2 6 6
1 16 0
.

0
0

0
0

The departmental committee of 1916 reported that the existing
financial provisions of the insurance acts were not sufficiently elastic
to meet the strain of temporary periods of excessive sickness. They
recommended the creation of a contingencies fund for each society,
as a measure of reinsurance within the society itself, for the purpose
of enabling the society to meet casual variations in the claim rate,
or alternatively to be available for return in the form of additional
benefits to the members as a result of favorable conditions, and
thus to give the members an interest in securing a high level of ad­
ministration. This feature of having each society receive the ad­
vantage of efficient management and, conversely, bear the cost of
lax management is always emphasized by the official studies on the



42

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

system. A society which has accumulated a surplus by careful
management must not be deprived of the larger benefits which it
can then afford to give its members by being called on to subsidise
another society which has a deficiency* because of less careful man­
agement. For this reason the resources of the contingencies fund
are to be devoted entirely to the society which has provided them—
in fact the moneys might just as well be left in the safe box of each
society. As far as the use of this fund is concerned, though, as
will be stated in connection with the central fund, one-eighth of the
amount diverted from the original sinking fund income is actually
placed in a “ pool” for the benefit of all societies.
The management of the moneys for the contingencies fund is in
the hands of the three insurance authorities, the Ministry of Health
for England and Wales, the Scottish Board of Health, and the Irish
Insurance Commissioners. The fund is fed by the following sums:
Under the act of 1918 the amounts were seven-eighths “ of a sum
representing in the case of men four-riinths, and in the case pf women
three-ninths, of a penny for each weekly contribution paid in respect
of a member of a society.” Under tne act of 1920 these amounts
were increased so that they now are seven-eighths of two-thirds of a
penny in the case of men and of one-half penny in the case of womens
This increase was necessary to provide for the larger benefits of the
1920 act. To these amounts should be added the interest accumu­
lations.

The deductions placed in the fund are those which would have
been credited if the fund had been in existence since the commence­
ment of the system.
’

The apportionment of the contingencies fund among the societies
is regulated by section 3 of the 1918 act. The men’s contributions
are placed in one account and this is apportioned among the socie­
ties in proportion to the number of men’s contributions each society
has made, together with the share of interest earned. The same
procedure is followed in the case of the women’s contributions.
The amount so apportioned is from time to time to be made avail­
able for making good any deficiency which may appear when a quin­
quennial valuation is made; if there is no deficiency, or if there is a
balance after covering the deficiency, the amount must be placed
in the benefit fund of the society. The society, however, may not
‘use such a receipt to provide any of the “ additional benefits” de­
scribed on page 32.
CENTRAL FUND.

The central fund is a common fund for all Societies, to be drawn
upon to meet deficiencies shown to exist at a five-year valuation;
it is administ^eS ‘by the National Health Insurance Joint Com^
mitfcee. The<fufid is fed, first by the remaining one^oighth of the
amount deducted from the contingencies and Central ftinds, that is;
one-eighth of the following: Two-thirds of a penny for men and onehalf penny for women. Under the 1918 act, the rates were oneeighth of the following: Men four-ninths: -penny, womeothreeninths penny, The second source of income of the* centr&Iftmd is
an annual apprbpriaticm by Parliament of £150,000 :($729)97$^ par)
beginning with the -ye&r 1917; To these sums is added theinterest



FINANCIAL ADMINISTRATION.

43

earned. Although the fund was created by the act of 1918, the
deductions credited to it are the sums which would have been placed
there had the plan been in force from the beginning of the system.
The distribution of the central fund is regulated by section 4 of
the 1918 act, which provides that if on the valuation of a society a
deficiency is found to exist and the sums available in the contin­
gencies fund are not sufficient to make good the deficiency then
the central fund may be drawn upon under the following condi­
tions: The National Health Insurance Joint Committee may direct
that the whole or a part of the deficiency shall be covered out of the
central fund if the committee is satisfied that the deficiency is due
in whole or in part to an abnormal rate of sickness among the mem­
bers on account of “ the nature of their employment or environment,
or their physical condition or any epidemic disease, or is due to tjie
rate of sickness being abnormal by reason of the small membership
of the society or branch, or is due to any other special cause beyond
the control of the society or branch.”
If at any time the joint committee decides that after taking into
account the necessity of creating a proper reserve, the sums stand­
ing to the credit of the central fund are more than sufficient for the
purposes of the fund, the committee may by regulations provide for
decreasing the amounts stated above and make a corresponding
increase in the amounts to be placed in the contingencies fund.
THE WOMEN’S EQUALIZATION FUND.

The departmental committee of 191& found that while the ex­
penditure for sickness and maternity benefits in respect of men’s
insurance was substantially within the provision made for it, the
same expenditure for women’s insurance was distinctly in excess of
the provision of the insurance acts. The original estimates of the
system were based on the Manchester Unity of Odd Fellows’ experience
for men, but heavily weighted to allow for greater sickness among
women. The 1916 committee found that, in the light of the fuller
knowledge available after several years’ operation, the pressure of
sickness claims of women had been underestimated and that there
was a lack of balance between net provision and benefit. It was
also found that, apart from the general excess in the expenditure
upon claims for sickness benefit for women, experience had shown
that married women in particular appeared to be subject to a greater
amount of sickness than women generally and that this further ex­
cess emerged in the experience of the societies in proportion to the
number of married women included in their membership;
To correct this inadequate provision, the committee made two
recommendations. The first was that the amounts set aside for the
redemption of reserve values had been found to be slightly greater
than was necessary in the case of women, and they proposed, that the
rate should be changed from l^d. (3 cents, par) (1911 law) to lfd.
(2.5 cents, par). This would immediately release a larger sum
for benefits for women generally, while correcting an excessive charge
for sinking fund purposes. This was part of the deductions already
referred to under the contingencies funds’ amounts.
The second recommendation was the establishment of a women’s
equalization fund. As finally worked out in the 1918 law, this fund



44

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

was to be dievoted to meeting the sickness claims of women of approved
'societies. The annual income of the fund is a sum not exceeding 10s.
($2.43, par) per .married woman employed contributor, and the plan
of distribution is prepared by the joint committee with the approval
of the treasury. The money is appropriated by Parliament for this
purpose, and the 10s. is increased by the usual grant of two-ninths of a
weekly contribution notwithstanding the fact that the income was
wholly or partly provided by Parliament.
Under the 1911 act, it was for a while a matter of doubt whether
disability due to pregnancy formed a valid claim for sickness benefit,
as the practice of friendly societies had varied in this respect. Be­
cause of i this lack of uniformity of treatment of woman members,
Parliament acceded to the reqhe^t of the societies and made an
appropriation;<ffor grants toward the cost of sickne^5
benefit, includ­
ing- loss of contributions incurred since the* commencement'of the
act, by approved societies having woman members, on a basis calcu­
lated with reference to the relative incidence of incapacity during
pregnancy among such members, £500,000 [$2,433,250, par].” This
sum was granted in the budget for 1915-16; for 1916-17,the amount
was £100 ($486.65, par);andfor 1917-18 it was £10(000 ($48,665, par) .
Because of war conditions these amounts were not distributed, and
when the 1918 act provided for the women’s equalization fund, the
£51Qr100. ($2,482,402, par) were placed in it to be distributed to
the societies on the basis of 8s. ($1.95, par) per married woman who
was a member of a Society and an employed contributor. The 1920
act increased the rate from,8s. to 10s. ($1.95 to $2.43, par). At the
time the 1918 act was passed it was Understood that the Government
would regularly appropriate £250,000 ($1,216,625, par) for the fund;
in the estimates the amount needed for 1920 would have been £280,000
($1,362,620, par) , but the act of 1920 increased this sum to £350,000
($1,703,275,1par). It Seems, therefore, that Parliament has com­
mitted itself to providing this amount regularly in the future, and the
undertaking was largely made because of its great importance as an
aid in redxfcing the infantile mortality rate aside from its value in
protecting the health of the mothers.
THE VALUE OF THE BENEFITS.

The question as to what the insured person gets in return for his
contribution has been computed by the actuaries in connection with
the revision of the system introduced by the act of 1920. The
insured man pays 5d. (10*1 cents, par) anct the insured woman pays
4d. (8.1 cents, par) per week; to these amounts the employer adds 5ch,
making tiie total paid lOd. amd9d. (20.3 cents and 18.3 cents, par),
respectively. Besides these payments, the State adds two-ninths of
the TOst of nenefits ‘(including expenses of administration of the soeieties and bf the insurance committee^) as wellias certain special grants.
The basis on which the rates have been calculated is that! for an en­
tra n t^ the age o ff 16, using the tables given \>n pages 47; and 48,
prescribedby the valuation regulations of 1919. The portion of the
contributions appropriate to each item of benefit is As follows, sevenninths of the contribution being allotted:




45

FINANCIAL ADMINISTRATION.

W eek ly C ontributio n for S e v e n -N in t h s B e n e f it .
[Penny at par=2.03 cents.]
Men.

Sickness benefit.................................................................................. 3. 02
Disablement benefit........r.................................................... ............1.11
Maternity benefit.....................................................................
68
Medical benefit....................................................... \ ......................... 1.92
Expenses of administration......................................................................94
7. 67
Total

Women.

2. 68
.92
.49
2.01
.98
7.08

The amounts set aside for cancellation of reserve values and for
the contingencies and central funds are described on page 40; the
apportionment of the full contribution—lOd. (20.3 cents, par) for
men and 9d. (18.3 cents, par) for women—is as follows:
[Penny at par=2.03 cents.]

Men.

Women.

To benefit fund (including administration)...................... ........ 7§
To contingencies fund and central fund............................ ........
}
To redemption of reserve values.......................................... , — - I f
Total................................................................................. ........ 10

1A

d.

d.

i

9

As only about one-seventh of the insured women remain in em­
ployment after marriage, there is a marked difference in the amounts
necessary to be allotted to the two sexes. This comes out promi­
nently in the case of the disablement benefit. The largest part of the
contributions must be devoted to providing the sickness benefit,
with medical benefit coming next in amount. The maternity benefit
of 40s. ($9.73, par) calls for 0.68d. and 0.49d. (1.38 cents and 0.99
cent, par) of the contribution of men and of women, respectively.
These amounts are about 9 per cent and 7 per cent, respectively, of
the contributions.
The benefits described above, the redemption of the reserve values,
and the two funds which are in effect reinsurance funds, therefore
require the entire amount of the full contribution—namely, the lOd.
and 9d. The normal benefits in the case of a person entering at
age 16 are thus of (equal value with the contributions; the State
grant of two-ninths, in actual practice, counterbalances the charge
on new entrants for both the contingencies fund and the redemption
of reserved values, so that he receives the full amount of his contribu­
tion. This is increased by the fact that the contingencies funds
belong entirely to his society, either to prevent a decrease of benefit
in case of deficiency or to provide extra benefits in case of surplus.
Another factor of increase is the State grant for the women’s equaliza­
tion, which will after 1920 be about £450,000 ($2,189,925, par).
Considering all these items, the actuaries who made the estimates for
the 1920 act state that the full value of the benefits is equivalent, in
the case of a man, to 10.6d. (21.5 cents, par) per week as against
a contribution of lOd. (20.3 cents, par), half of which is paid by the
employer; while in the case of women the value of the benefits is
10.Id. (20.5 cents, par) per week as against a contribution of 9d. (18.3
cents, par), 5d. of which is paid by the employer. Stated very briefly
104936° —23—Bull. 312------4




46

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

and without endeavoring to be minutely accurate, the insured man
pays 5d. and receives 10.6d weekly; the insured woman pays 4d. and
receives 10.Id. weekly.
RESERVE SUSPENSE FUND.

If a member of an approved society ceases to be an insured person,
then his transfer value is placed in a special fund called the reserve
suspense fund. This fund must be kept in two accounts, one’for
men and one for women. Whenever a person enters the insurance,
his (or her) reserve value is provided out of the sums standing in
the reserve suspense fund. Tnis fund must be invested in the same
manner as the assets of the National Health Insurance Fund.
THE ACTUARIAL VALUATION.

The act of 1911 provided that a valuation of the assets and lia­
bilities of the carriers should be made every three years; this short
period wa§ originally adopted in order that changes in benefits or
the assessment of a levy might be made quickly in case a deficiency
should occur in the operations of the approved societies under the
act. The committee of 1916 found that this brief period was for
aU practical; purposes an unnecessary burden on the societies and
recommended a five-year period.. This was adopted by Parliament
and tie act of 1918 required that a valuation should be made every
five years at least, aiid oftener if the commissioners so decide. The
first valuation was taken as of December 31, 1918, and a preliminary
report of the results was issued in March, 1921, under the title “ In­
terim report of the Government actuary upon the valuation of
the assets and liabilities of approved societies as at 31st December,
1918, ” being Command Paper No. 1130 of 1921. The main features
of this report are given below.
The plan used in making the valuation is set forth in Statutory
Rules and Orders No.; 1119 of 1919, entitled “ National insurance
valuation regulations, 1919, ” printed in September, 1919. These
regulations give specific instructions to be followed in computing
the value of benefits, contributions, investments, etc.; they are the
usual rules followed by actuaries in such valuations and are given
in detail in order to secure absolute uniformity in all cases. Of
special importance, however, are the four tables appended to these
regulations, showing (1) the expectancy of life, (2) the expectancy of
sickness and. disablement, (3) the “issue rate” to indicate liability
for maternity benefit, and (4) the expectancy of marriage. These
four tables are as follows:




47

FINANCIAL ADMINISTRATION,

LIFE TABLE: PROBABILITY THAT A PERSON OF AN EXACT AGE AS SHOWN IN THE
FIRST COLUMN WILL SURVIVE ONE YEAR.
[Source: National Insurance Valuation Regulations, 1919. Statutory Rules and Orders, 1919, No. 1119.
London, 1919. Page 9.)
Age16.........................................
17............................ ............
18........................................
19.........................................
20.........................................
21........................................
22......................... ..............
23..1....... ............................
24...........................*............
25.........................................
26......................... ...............
27.........................................
28.........................................
29................... ...........................
30.........................................
31........................................
32.........................................
33.............................................^
34..............................................
35...............................................
36...............................................
37................. ..................... ..
38...............................................
39:...........................................
40.........................................
41. ............................................
42......................... ...............
43......................... ................
4 4 ... .............................. ..
45...............................................
46. ............ .........................
47...............................................
48...............................................
49. .......................... ..V .*..........
5 0 . ........................
51...............................................
52.........................................
54......... ; ................. .................
55....................... .................
56.........................................
57.......................................... .
58...........................................
59____: .....................................
60......................... .....................
61...............................................




Men.
0.99699
.99689
.99678
.99666
.99654
.99642
.99629
.99615
.99600
.99585
.99568
.99550
.99531
.99510
.99489
.99466
.99441
.99414
.99386
.99356
.99323
.99287
.99249
.99208
.99163
.99115
.99063
.99007
. 98946
.98880
.98809
.98732
.98648
.98556
.98457
.98349
.98231
.98103
.97964
.97813
.97649
.97470
.97276
.97064
.96834
.96584

Women.
0.99738
.99730
.99722
.99713
.99703
.99693
.99682
.99670
.99657
.99644
.99630
.99615.
.99598
.99581
.99563
.99544
.99523
.99501
.99478
.99454
.99428
.99401
.99372
.99342
.99310
.99277
.99241
.99203
.99162
.99118
.99071
.99019
.98963
.98901
.98833
. 98757
.98673
.98579
.98474
.98357
.98227
.98083
.97923
;97745
.97549
.97334

Age.
62............................
63 . ...........................
64.............................. ........
65.........................................
66...............................
67.............................
68........................................
69.........................................
70..............................^...
71......................... ...............
72............................
73................. i ............
74::............................. » ■
75..........J............... . . .
76....................................
77.............................
78........... ................... .
79................. .............. ..
8 0 .. ........................ .................
81...............................................
82................... ........... .. .
83............... : . . . . ____ . . . . . .
84............... ............................
85.................A . . .
86...............................................
87............... .........................
88...............................
89................. .................
90. .............................
91...............................................
92. ............................................
93...............................
94...............................................
95...............................................
9 6 ... ..........................
97...................................
98.............................................
106.
101.. . . . . . . . . . . . . .
■
102..................................
1 0 3 ....... ...... ................. >
104................... .j................
105.;:....... . . . ; . .
1Q . . . .......... ..........
6
.

Men.

Women.

0.96313
0.97099
.96018
.96841
. 95699
.96560
.95352
.96254
.94976
.95922
. 94569
.95560
.94129
.95167
.93653
.94742
.93138
.94282
.92582
.93783
. 91982
.93243
. 91335
;92660
.90637
.92030
.91349
.89886
.89078
.90614
. 88210
.89822
.87276
.88968
.86273
.88047
.85197
.87054.84043
.85983
.82806
.84829
. 81480
.83585
.80060
.82245
.78541
.80800
.76916
.79241
.75178
.77559
.73320
.75744
.71336
.73786
69219
!71672
.66961
!69388
.64554
.66920
.61989
.64253
.59258
. 61371
.56353
.58257
. 53266
.54894
.49989
. 51263
. 46515
. 47345
.42887* ? ,43122
.38950
.38579
.33703
.34850
.30534
.28491
.26000
! j .22960
.21246
.17164
. 16270
. 112
22
.11071
105363

48

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

AVERAGE NUMBER OF,WEEKS' SICKNESS AND DISABLEMENT BENEFITS PAYABLE
PER MEMBER WITHIN ONE YEAR.
[Source: National Insurance Valuation Regulations, 1919. Statutory Rules and Orders, 1919, No. 1119.
London, 1919. Page 10.)
Men.

Women.

Dis­
Dis­
Sick­ able­ Sick­ able­
ness. ment. ness. ment.
16..........................
17. ......................
18 ........................
19 ........................
2 0 ;................. .
21..........................
2 2 ...................
23...... ...............
2 4 ....,..............
2 5 ..................
26..........................
2 7 .......................
28.. ............
29*>.■ ;...........
30.;....................*
31..........................
32 ..................
33.........................
34.........................
35.........................
36..........................
37.........................
38..........................
39 ...................
40..........................
41..........................
42..........................

Men.

Women.

Dis­
Dis­
Sick­ able­ Sick­ able­
ness. ment. ness. ment.

43.......................... 1.104 0.640 1.258 0.772
0.938
1.154
1,137
44...... .................. 1.134 .687 1.286
.920
.823
.888 0.038 1.104 0.051 45........................; 1.166 .740 1.316
.882
.849 .054 1.063
.071 4 8 ........................ 1.202 .799 1.349
.948
.814 .071 1.025
.094 47 .................. . 1.244 .870 1.388 1.027
.788 .089 .995
.119 48.......................... 1.290 .955 1.431 1.120
.773 , 108 .976
.144 40...1..........
1.340 1.055 1.478 •1, 229
.769 .127 .968
.170 5 0 .;...............*... 1.395 -1.172 1.528 1.359
.769 .143 .965
.190 5 i .. . . ................ 1.449 1,311 1.579 1.509
.773 .158 .967 . .209 52 ................
1.507 1.465 1.633 1.676
.776 .170 .968
.225 53.......................... 1.568 1.639 1.691 1.865
.779 .182 .971
.238 54* . ................ . 1.639 1.828 1.756 2.070
.787 .190 .977
.250 5 6 ..................
1.716 2.035 1.829 2.292
.797 .201 .985
.263 56...... ................... 1.798 2.264 1.907 2.538
.808 ,214 .995
.279 57........................ 1.887 2.-518 1.992 2.890
.822 .230 1.006
.299 58.......................... 1.979 2.806 2.080 3.117
.837 .249 1.018
.323 59;:...^................ 2.074 3.147 2.171 3^480
.851 .271 1.031
.348 6 0 .................... ... 2.179 3.553 2.270 3.913
.867 .293 1.045
.374 61*................. . 2.292 4.044 2.378 4.436
.885 .319 1.061
.404 62 ........................ 2.409 4.633 2.490 -5.061
.905 .348 1.079
.438 63.......................... 2.529 5.316 2.604 5.786
.478 64 .................. ;.. 2.650 6.087 2.719
.928 .382 1.099
. .955 .420 1.122
.523 65...... .................. 2.769 6.946 2.835 6.603
7! 509
- .983 .463 1.147
.572 6 6 ........... i. 2.894 7,899 2.953 8.518*
1.012 .507 1.174
.621 67....................'.t. 3.020 8.971 3.074 9!651
.671 68.......................... 3.142 10.183 3.191 10.932
1.043 .551 1.202
1.073 .595 1.230 ,720 69....................... 3.247 11.543 3.292 12.368

N ote.—The above are “central rates," i. e., the ratios of the total number of weeks of sickness or
disablement benefit payable during the year of age following' the exact age given in the table to the
number of persons ahve in the middle of that year of age.
•

The above figures for England give an average of about If weeks
of sickness per insured person per annum; this would he. raised to
abput 2 weeks of disability per annum if account were taken of
(a) the 4 days of waiting time before sickness benefit becomes pay­
able; (b) accidents; ana (c) other sicknesses on account of which
benefit is not paid. Under English conditions, therefore, the insur­
ance system must make financial provision for each insured person
being incapacitated for from If to 2 weeks each year.




FINANCIAL ADMffllSTEATIOSF,

49

Ma t e r n i t y b e n e f i t : p r o b a b il it y o f is s u e to a m e m b e r d u r in g o n e y e a r .
[Source: National Insurance Valuation Regulations, 1919, Statutory Rules and Orders 1919, No. 1119.
London, 1919, p. 11-1
Married Spinsters
Married
Men.
Age.
and
Age.
Men.
women.1 widows.1
women.
16.
0.4000
0.0019 43...............................
0.0734
17.
.6000
.0062 44....................
.0635
18.
0.0015
.6900
.0087 45................................
.0215
.0544
19.
.0089
.6700
.0099 46................................
.0119
.0464
.0271
20
.6030
.0056
.0105 47................................
.0394
21
.0533
.5336
.0107 48................................
.0021
.0333
22.
.0803
49................................
.4759
.0106
.0006
.0279
23.
.1046
.4291
.0102 50................................
.0001
.0233
24.
.1260
.3909
.0095 51................................
.0193
25.
.1440
.0084 52................................
.3592
.0159
26.
.1588
.0072 53...............................
.3327
.0130
.1704
27.
.3105
.0057 54...............................
.0107
.1791
28.
.2916
.0042 55................................
.0086
29.
.1848
.2753
.0028 56...............................
.0069
30.
.1877
.2608
.0015 57...............................
.0055
.1882
31.
.2474
.0045
.0007 58...............................
.1860
32.
.0036
.2344
.0002 59................................
.1815
33.
.2213
.0000 60................................
.0029
61...............................
34.
.1747
.0024
.2080
.1661
35.
62................................
.0019
.1940
.1558
63................................
36.
.1788
.0015
.1444
64................................
.0011
37.
.1622
.1323
65................................
.1444
.0008
38.
.1200
.1256
66...............................
.0006
39.
67...............................
. 1076
.1062
.0004
40.
.0956
.0866
68................... ...........
41.
.0002
.0841
.0676
69................................
.0001
42.
1Provision for posthumous births is made in the rates applicable to married women and not in the rates
applicable to widows.
N ote.—The above are “central rates,” i. e., the ratios of the number of maternity benefits payable in
the year of age following the exact age given in the table to the number of persons alive in the middle of that
year of age.
PROBABILITY OF MARRIAGE (WOMEN) AND OF BECOMING A WIDOW.
[Source: National Insurance Valuation Regulations, 1919, Statutory Rules and Orders, 1919, No. 1119.
London, 1919, p. 12.]
Probability Probability
Probability Probability
of marriage. of becoming
of marriage. of becoming
Age.
Age.
(Spinsters
(Spinsters
and widows.) a widow.
and widows.) a widow.
0.0071
0.0041 43..................................
0.0135
16..................................
0.0129
.0041 44..................................
17..................................
.0164
.0121
.0138
18..................................
.0309
.0109
.0042 45..................................
.0147
.0494
.0043 46..................................
19..................................
.0098
.0156
.0689
.0044 47..................................
.0088
20..................................
.0166
.0866
.0045 48..................................
21..............................
.0079
.0177
49..................................
22..................................
.1005
.0046
.0071
.0190
23..................................
.1085
.0047 50......................... .
.0063
.0205
.1112
.0048 51..................................
.0056
24..................................
.0221
.1091
.0050 52................................
.0049
25..................................
.0238
.0052 53..................................
.1035
.0043
26..................................
.0255
.0054 54..................................
.0955
.0037
27..................................
.0272
.0862
.0056 55..................................
.0033
28..................................
.0290
.0766
29..................................
.0058 56..................................
.0028
.0309
.0672
.0061 57..................................
.0024
30..................................
.0329
.0586
.0064 58......................... ........
31..................................
.0021
.0351
.0509
.0067 59..................................
32..................................
.0018
.0376
.0443
.0070 60..................................
.0016
33..................................
.0406
.0386
.0073 61..................................
34................................ ;
.0014
.0441
.0077 62..................................
.0338
.0012
35..................................
.0479
36..................................
.0298
.0081 63..................................
.0010
.0517
.0086 64..................................
.0264
.0009
37..................................
.0555
.0234
.0091 65..................................
.0008
38..................................
.0594
.0208
.0097 66..................................
.0007
39..................................
.0632
.0186
.0104 67..................................
.0006
40..................................
.0673
41..................................
.0167
.0112 68..................................
.0005
.0715
.0150
.0120 69..................................
.0004
42..................................
.0762
N ote.—The above are “ central rates,” e. g. the probability of marriage of a spinster or a widow is the
ratio of the number of marriages in a year of age following the exact age given in the table to the number
of spinsters and widows alive m the middle of that year ofage.
.

.




50

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

The preliminary report on the valuation above referred to covers
about 40 per cent of the valuations and includes 5,036 societies and
branches, with 2,752,308 members. The general results of the valua­
tions may be summarized as follows:

In the case of 4,878 societies and branches, comprising 2,704,371 members, the
valuations have disclosed surpluses, the aggregate amount of the surpluses being
£3,609,248 [$17,564,405, par]. Deficiencies have been found on the valuations of
155 societies and branches having a membership of 47,539. The total amount of the
deficiencies is £15,974 [$77,737, par]. In three cases, with a total membership of
398, the assets and liabilities balance exactly.

The following table shows the results of these valuations:

PARTIAL REPORT OF RESULTS OF THE VALUATIONS OF APPROVED SOCIETIES,
DECEMBER 31, 1918.
[Source: Interim report by the Government actuary upon the valuation of the assets and liabilities of
approved societies as at 31st Dec., 1918. London, 1921. Cmd. 1130, p. 4. £ at par=$4.8665.]
Valuations showing
surpluses.
Country.

Number
of socie­
ties and
branches.

England.........................
Scotland.........................
Ireland.............; ......... .
Wales.................
United Kingdom.

Num­
Total
ber of amount of
mem­ surpluses.
bers.

4,224
333
104
217
4,878

2,027,321 £2,816,479
490,279
270,768
185,605- 174,319*
220,677
128,171f
2,704,371 3,609,248

Valuations
showing an
exact balance
of assets and
liabilities.

Valuations showing
deficiencies.
Number
of socie­
ties and
branches.

Num­ Total Number
ber of amount of socie­
mem­ of defi­ ties and
bers. ciencies. branches.

836 £10,517
117
4
802
369
8,580
3,257
28 4,321
1,831
155 47,539 15,974

Num­
ber of
mem­
bers.

3

398

3

6

398

This table gives the results of the valuations for the entire member­
ship. As the benefits vary for men and for women, the composition
of the membership is of importance. As many societies admit both
men and women and insure them in a common fund, it was not
possible to separate the data completely for the sexes. From the
available information, the following table was compiled:
PARTIAL REPORT OF THE RESULTS OF THE VALUATIONS OF APPROVED SOCIETIES,
BY CLASS OF MEMBERSHIP, DECEMBER 31, 1918.
[Source: Interim report by the Government actuary upon the valuation of the assets and liabilities of
approved societies as at 31st Dec., 1918. London, 1921. Cmd. 1130, p. 4. £ at par =$4.8665.J
Valuations showing surpluses.
Class.

Valuations showing deficiencies.

Number of societies and
Number of societies and
branches.
branches.
Number Total
of mem­ amount of
bers. surpluses. Eng­ Scot­ Ire­
Eng­ Scot­ Ire­
land. land. land. Wales.
land. land. land. Wales.

Men only1......... 2,519 85 34
Women only___ 297 26 4
Men and women
in common in­
surance............ 1,408
Total............ 4,224 333 104

222 66

1

Num­ Total
ber of amount
mem­ of defi­
bers. ciencies.

66 1 2 12 16,999
4,397

£6,087
1,466

16 26,143
28 47,539

8,421
15,974

99 1,029,362 £1,604,516
170,562
169,056 17

117 1,504,447 1,835,676 34
217 2,704,371 3,609,248 117

3
4

4.

6

1In England there are also three cases with 398 members in which the assets and liabilities balance exactly.



FINANCIAL ADMINISTRATION.

51

The most conspicuous result of the valuations is that the amount
of the surpluses is quite large, while the amount of the deficits is
relatively insignificant. The Government actuary states that con­
ditions which have prevailed during the war “have greatly affected
the finance of national health insurance, and it is evident that to a
material extent the surpluses.now declared are due to this cause.”
He sums up the principal factors which have entered into the produc­
tion of the surpluses as follows:
(а ) The claims for sickness, disablement, and maternity benefits have been con­
siderably below the provision made for the expenditure under these heads in the
financial basis of the acts.
As regards the sickness and maternity benefits much of the resulting gain is trace­
able to the fall in the claims which set in with the year 1915 and continued until 1918.
No previous experience of friendly societies affords a parallel to this phenomenon,
which is unmistakably connected with the war.
It is important to remember in this connection that the supernormal experience of
men who were invalided from the forces has been met by an annual grant from the
exchequer. The relatively heavy liability of married women, which at one time
attracted attention, has also been corrected by an annual grant from public funds. In
respect, therefore, of both men and women, the societies have been protected from
elements of liability that were outside the scope of the original estimates, and accord­
ingly reap the full advantage of the favorable experience which has prevailed.
In the case of disablement benefit the claims have steadily risen, as they must do
for some years to come, since disablement benefit represents the provision for more or
less permanent incapacity among a community all of whose members were in employ­
ment on first entering into insurance, in or after the year 1912. The increase in the
cost of disablement benefit has, however, been considerably less than that anticipated,
though it should be added that this feature is much less noticeable in the case of women
than it is in the case of men.
(б ) The interest realized on the investments of the accumulated funds has been
appreciably in excess of the valuation rate of 3 per cent. Interest at this rate is
credited in respect of reserve values, which at present form the major part of the assets
of approved societies, but the great bulk of the funds accumulated since 1912 has been
invested in Government securities producing, especially since the war, a much higher
rate. Approved societies are exempt from income tax on interest, and therefore
obtain the full benefit of the high rates of interest at which they have been enabled to
invest.
The element of depreciation had not up to the valuation date become a serious factor,
and the valuation regulations provided that stock exchange securities held by societies
should be taken at their cost prices. So far as the funds of societies consist, under
statutory directions, of credits in the commissioners’ investment account (comprising
approximately 50 per cent of the total amount accumulated) the question of depre­
ciation may be presumed, in any case, not to arise, since by appropriate regulations,
prescribing the rate of interest allowed, provision may be made for the creation of
sufficient reserves to protect the fund. The rate of interest at present allowed in re­
spect of these credits is 4 per cent, leaving, it is understood, a suitable margin for the
purpose here indicated.
(c) The receipts from contributions in many cases have exceeded th e ‘1expectation. ’’
Contributions are not payable in periods of sickness or unemployment, and it follows
that in years when sickness is below the average and employment abundant the re­
ceipts from contributions show a considerable gain to societies. These conditions
prevailed generally up to 31st December, 1918.
( d ) ‘‘War mortality, ’’ in the case of men, has added greatly to surplus. The liabili­
ties of societies have been reduced by deaths of which there had been no expectation,
while the credits given, and the funds accumulated, to meet those liabilities remain
intact.

While much of the favorable sickness and disablement experience of
the societies has been due to war conditions, the actuary also ascribes
part of it to the favorable environment and the nature of the occu­
pations of many of the insured persons. Thus the membership of
rural societies and of societies including such occupations as bank
clerks, journalists, teachers, etc., have shown favorable results.




52

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

Another feature which has aided in producing the surplus, or at
any rate which affects the result, is the quality of administration of
the societies. In some of the cases of deficiencies and of small sur­
plus, the quality of administration has been clearly the cause of the
unfavorable results.
Disposition of the surplus.—Under the insurance acts a society is
authorized to submit a plan for the distribution of the surplus in
the form of additional benefits, provided that the actuary certifies
the surplus to be disposable. It is recommended that appropriate
plans for this purpose be approved, but that such additional bene­
fits shall be restricted to five-year periods—that is, to the period of
the quinquennial valuation.
In certifying a surplus as disposable, the per capita reserve for the
legal benefits is taken as 11s. ($2.68, par) for men and 9s. ($2.19, par)
for women. In only a few cases has the surplus been shown to be
smaller than this reserve and of course in such instances the surplus
is not disposable. In the great majority of cases the balance avail­
able for distribution is considerable, the total amount certified as
disposable being £2,171,576 ($10,567,975, par), or on the average 62
per cent of the related surpluses.
The disposable surpluses are classified by country and by type of
society in the table following, reproduced from the interim report of
the Government actuary.
DISPOSABLE SURPLUSES, BY SEX OF MEMBERSHIP AND BY COUNTRY.
[Source: Interim report by tL? Go e.nn s a t actuary upon the valuation of the assets and liablilities of
approved societies as . °ls'■ .J cj.. lr;U. London, 1921. Cmd 1130. Page 7. £ at par=$4.8665.
Sex of mem w i , and co ntry.
Men only............................................
Women oi / ......................................
Men and w: men i ’ ;ouimoi'. in­
surance............................................
Total........................................
COU^T, Y
England..............................................
Scotland..............................................
Ireland................................................
Wales..................................................
United Kingdom.......................

Number of
societies Number of Amount of
and
members. disposable
surplus.
branches.
2,391
270
1,649
4,310

942,289
147,575
1,242,310
2,332,174

£977,116
103,764
1,090,696
2,171,576

3,753
314
85
158
4,310

1,860,584
267,075
137,932
66,583
2,332,174

1,700,788
322,233
106,571
41,984
2,171,576

According to the preceding table the valuations included in the
interim report show that 85 per cent of the insured persons in the
societies covered by the report are in a position to receive additional
benefits.
Amount o f additional benefits.—Some of the additional benefits
permissible under the law are not capable of being measured by
actuarial computation, but in the case of the normal pecuniary bene­
fits such estimates can be made with a reasonable degree of accuracy.
Such a calculation has been made on the assumption that all of the




53

GENEEAL ABMINISTKATlOtf.

available surplus is used for additions to the existing pecuniary
benefits on the following basis:
Is. (24.3 cents, par) a week additional sickness benefit.
6d. (12.2 cents, par) a week additional disablement benefit.
2s. (48.7 cents, par) additional maternity benefit.

On this basis the following table shows the number of persons in
whose cases the disposable surplus admits, if applied wholly to this
purpose, of the payment of each rate of additional sickness benefit
from Is. (24.3 cents, par) to 5s. ($1.22, par), with corresponding addi­
tional disablement and maternity benefits according to the proportion
given in the preceding paragraph.
NUMBER OF INSURED PERSONS WHO CAN BE GRANTED ADDITIONAL BENEFITS
OF VARYING AMOUNT, ON THE RESULTS OF VALUATIONS OF APPROVED SOCIE­
TIES, DECEMBER 31, 1918.
[Source: Interim report by the Government actuary upon the valuation of the assets and liabilities of
approved societies as at 31st Dec., 1918. London, 1921. Cmd. 1130. Page 8. Shilling at par=24.3
cents; penny=2.03 cents.]
England.

Additional benefits.

Dis­
Sick­ able­ Ma­
ness ment ter­ Men.
(per
week). A nity.

16
0
10
26
2
3 0
3 6
4 0
4 6
5 0

s. d.

0 d.
6
9
13
0
16
2 90
3
26

«.
0
1
1
2

Total....

s.
2
6
8
10

3
4
5
7
9

114,328
110,295
324,966
161,338
166,380
154,337
159,631
103,382
170,341
1,464,998

Scotland.

Ireland.

Wales.

United Kingdom,

Wom­ Men. Wom­ Men. Wom­ Men. Wom­
en.
en.
en.
en.

Men.

Wom­
en.

21,656
2,507
2,710
17,600
5,798
21,502
2,516
660
6,278
81,227

156,345
141,248
348,991
195,198
187,835
190,444
180,615
122,415
269,866
1,792,957

59,670
51,814
60,156
66,315
41,665
57,465
46,016
20,880
31,555
435,536

46,257
44,315
46,410
49,763
30,890
31,583
24,689
16,022
22,552
312,481

8,050
10,450
16,037
8,999
11,297
13,563
17,688
17,788
90,943
194,815

4,788
1,133
11,509
4,992
7,669
20,435
4,478
4,256
65,272

6,012

6,913
278
1,182
10,589
2,508
18,027
864
356
4,550
45,267

12,311
17,996
5,278
7,261
4,360
1,042
780
585
2,304
51,917

1,712
6,088
1,055
971
2,255
186
28
24
197
12,516

N ote.—In the case of certain societies and branches with a total membership of 103,681 (65,566 men
and 48,115 women) the disposable surplus is insufficient to provide for additional money benefits under
the above general plan and must be applied to other forms of additional benefit.

The point of special interest in the table is the large number of

ersons who come in
E etc.—is given.the line in which the highest rate—5s. sickness
enefit,

Deficiencies.—In the case of the societies having a deficiency, the
actuary reports that it seems probable that the contingencies funds
will be sufficient to make good all the claims that may be made upon
them.
GENERAL ADMINISTRATION.

The insurance svstem is managed by three bodies, the Ministry of
Health in England and Wales, the Scottish Board of Health, and the
Irish Insurance Commissioners, Parliament fixes the limits of their
powers, but for all practical purposes it may be said that the three
systems of administration are independent, though acting under the
same laws.
In the present account of the administration the system used for
England and Wales will be followed, as the Scottish and Irish systems
follow the same general plan, but with numerous variations to adjust



54

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

it to the needs of those countries. The total number of insured per­
sons in the United Kingdom in 1920 was about 15,850,000, of whom
about 13,380,000 were residents of England and Wales, so that about
85 per cent of the insured persons are subject to the Ministry of
Health.
Under the ministry the principal part of the work of the insurance
system is carried on by two sets of organizations; the medical benefit
and the sanatorium benefit (in part) are administered by the insurance
committees, there being one such body for each administrative area;
the other benefits, the pecuniary, are provided through voluntary or­
ganizations called “ approved societies,” whose membership, the in­
sured persons, is scattered throughout the country.
Aiding the ministry is an independent, federated body called the
National Health Insurance Joint Committee, composed oi representa­
tives from the four countries, whose chief function is to decide on
matters common to all the countries and more particularly the
actuarial problems.
Under tne ministry are two advisory bodies entitled “ consultative
councils,” whose function is to give advice and assistance to the
minister.
Mention should also be made of a special organization called the
deposit contributor fund, intended to provide Benefits for such, per­
sons as do not join the “ approved societies.”
MINISTRY OP HEALTH.

The 1911 act provided that the insurance system should be ad­
ministered by four boards, entitled “insurance commissioners,” there
being one for each of the four countries of the United Kingdom.
These bodies continued in control of the system until July 1, 1919,
when the new Ministry of Health took charge of affairs in England
and Wales. The act4 creating the new ministry was approved on
June 3,1919, the ministry came into being on June 25, and the powers
and duties of the insurance commissioners (England) and the Welsh
insurance commissioners were transferred to it on July 1, 1919. A
number of other national authorities were placed under the jurisdic­
tion of the minister, the most important being the local government
board; but for present purposes, the authority over health insurance
matters only need be considered.
The establishment of the ministry was the result of an agitation
of several years for a centralization of the health activities of the
National Government. The war brought clearly before the country
the need for greater activity in preserving and improving the standard
of health of the people; as in the United States, the military service
acts showed in Great Britain a very high proportion of men below
the standard of physique ordinarily required for military service;
the infant mortality rate had been characterized by Mr. Lloyd George
as “ disgraceful;” the shortage of housing was so acute as to become
a menace to public health, and other problems equally pressing were
calling for action. In most of these matters earnest efforts had been
made to ameliorate the evils connected with them, usually by
creating a separate organization to handle the problem. In 1919 it*
* A summary of the act is given in the Monthly L abob R eview for August, 1919, pp. 227,228. The text
of the act is given in Public Health Reports, Oct. 10,1919, pp. 2233-2241.




GENERAL ADMINISTRATION.

55

was not difficult to prove that the large number of authorities work­
ing on matters such as the above were wasting much effort and
money by the lack of a central controlling authority to prevent over­
lapping and to require cooperation in work. It is not easy to state
how much influence the facts brought out by the operation*of the
insurance system had in focusing attention on health problems, but
one of the members of the committee which investigated the insurance
system could say with entire propriety as early as 1914 that—
The national insurance act has done great service in bringing to light a mass of suf­
fering and a number of social evils, as to which the nation as a whole was ill-informed
or indifferent. It will now be substantially easier than in 1911, both on account of
the new knowledge available and of the state of public opinion, to make adequate
provision to advance the health of the community.

A later report of the Ministry of Reconstruction made a similar
statement:
The original act of 1911 placed the control of the system in England
in the hands of a body entitled “ the insurance commissioners’’; this
board was appointed by the treasury, and in 1911 consisted of nine
members, one of whom was a woman.. In general they represented
the friendly societies, the trade-unions, the medical profession, etc.
Their work was summarized as follows:
1. To deal with the approved societies.
2. To deal with the collection of contributions and the receipt and issue of funds,
and to make the necessary accounting arrangements.
3. To deal with the insurance committees.
4. To deal with the provisions of the act as affecting individual insured persons
and classes of insured persons.
5. To control and organize the work of the outdoor staff (the field force) of the
commission.

The Ministry of Health took over the employees and property of
the commissioners and have in general continued the work on the
lines as established by their predecessors. The duties of the ministry
are so numerous that they can be stated as being that of the super­
vision and administration of the system for England and Wales.
NATIONAL HEALTH INSURANCE JOINT COMMITTEE.

Since July 1, 1919, this committee has been composed of the Min­
ister of Health as chairman, the Secretary for Scotland, the Chief Sec­
retary for Ireland, and one other person appointed by the Minister
of Health, having special knowledge and experience of national health
insurance in Wales.
This committee makes financial adjustments between the health
insurance funds of the different countries, has charge of the actuarial
valuation of the ^approved societies, has charge of the approval of so­
cieties operating in more than one country, etc. The most important
part of their work is that relating to actuarial questions.
CONSULTATIVE COUNCILS.

Section 4 of the Ministry of Health act authorized the appointment
of consultative councils in England and Wales for the purpose of
giving advice and assistance to the minister in connection with such
matters affecting or incidental to the health of the people as may be
referred to in the order in council establishing them. Every such



56

NATIONAL HEALTH INSURANCE IN GREAT BRITAIN.

council must include women as well as men and must consist of per­
sons having practical experience of the matters referred to it.
Four such councils are authorized, one of which is entitled “ con­
sultative council on national health insurance” (approved societies’
work).* It consists of 20 members.
The council is required to discuss and report on matters referred
to it by the minister, or it may on its own motion report to the min­
ister on any subject within its field.
In the discussions in Parliament on the act of 1920 the minister
made a special acknowledgment of the value of the services rendered
by the council in the preparation of the bill.
INSURANCE COMMITTEES.

Medical, and, in part, sanatorium benefits are administered by the
insurance committee, there being one such committee for each
county pr county borough. Cooperating with this committee are
the local medical committee, the panel committee, and the pharma­
ceutical committee; these three committees provide a means for. se­
curing proper expression of the opinion of the medical profession and
of the pharmaceutical profession in matters relating to the insurance.
The insurance committee must consist of not less than 40 or more
than 80 members, consisting of the following persons: (1) Threefifths of the membership must be representatives of the insured per­
sons; (2) one-fifth must be appointed by the council of the county;
(3) two members shall be elected by the association representing
the medical profession in the area; (4) one to three members, who
are duly qualified medical practitioners, shall be appointed by the
council of the county ; (5) other members appointed by the minister.
A number of the members must be women.
The constitution and by-laws of the insurance committee, (the regu­
lations as to their employees, and their proceedings generally are to
be prescribed by the minister or must be approved by him.
In certain cases the area covered by an insurance committee must
be subdivided, and a ildistrict insurance committee” must be created.
These have similar powers and duties. In the same manner insur­
ance committees may be consolidated at the discretion of the minister.
Besides the administration of the medical benefit, the powers and
duties of the insurance committees are:
1. They must make reports on the health of the insured persons
in the area subject to their jurisdiction; the minister may transmit to
the councils of the county (county borough), etc., copies of reports
made by the committee.
2. They must make provision for the giving of lectures and the
publication of information on questions relating to health as they
deem desirable.
3. They must keep records and accounts in the form prescribed
by the minister.
The legal position of an insurance committee is that of a body
corporate. It has perpetual succession, a common seal, may sue and
be sued, and, subject to the approval of the ministry, may take,
purchase, and hold land for purposes within the terms of the insur­
ance laws.



GENERAL, ADMINISTRATION.

57

The local medical committee is a voluntary organization of medical
practitioners for the purpose of representing their interests under the
system. If the minister is satisfied that such a committee is properly
representative of the profession, he may give it official recognition
and require the insurance committee to consult it on all general
questions affecting the administration of the^ medical benefit, in­
cluding such matters as giving attendance and treatment to insured
persons.

The panel committee is composed of physicians who have agreed
to serve as panel doctors. Where the insurance committee is re­
quired by law or regulation to ascertain the opinion of the panel
doctors as to matters of the medical benefit, it must do so by con­
sulting with the panel committee, which shall also perform such
duties as may be prescribed by the minister. If no local medical
committee has been given official recognition in any area, then the
panel committee may be recognized in its stead.
The pharmaceutical committee is a body in each county (or county
borough) required to be elected by the persons, firms, corporations,
etc., who have agreed to supply drugs, medicines, and appliances to
insured persons. It must, subject to certain regulations, be con­
sulted by the insurance committee in regard to the supply of drugs,
medicines, and appliances. It may also perform such other duties as
the minister may prescribe.
TJHese committees must have travel and subsistence expenses
paid while attending meetings. For this purpose the insurance com­
mittee may allot an annual sum of not more than Id. (2 cents, par)
per. insured person in the area represented.

Income of committees.—The act of 1911 (sec. 15, par. 6) provided
that there should be paid each year to the insurance committee for
each county, etc., out of the moneys credited to a society which has
members in that area, such sum in respect of the medical benefit of
such members and its cost of administration as might be agreed
upon between the societies and the committee. In default of an agree­
ment decision was to be made by the commissioners. Under the
act of 1920 this was changed, so that beginning with January 1,
1920, there is to be paid each year to insurance committees in Great
Britain, out of the funds for the payment of benefits on account of
medical benefit, a sum of 9s. 6d. ($2.31, par), and on account of the
administrative expenses of the insurance committees such sum not
exceeding 4d. (8.1 cents, par), as may be prescribed in respect of
each of the total number (calculated in the prescribed manner) of the
persons who are entitled to medical benefit as being or having been
members of an approved society.
The* distribution of the money derived on this basis is provided
for by the medical benefit regulations of 1920. The amounts to be
paid the doctors are divided into two parts—the central practitioners’
fund and the mileage fund. The distribution is arranged by a
distribution committee, consisting of practitioners and others,
appointed by the minister, and their plans must be approved or may
be revised by him. On the basis of the distribution of the insured
population, these sums are allotted to the various insurance com­
mittees, though in some cases no mileage grant is given. Special
arrangements are made for payments to institutions (hospitals,
dispensaries, etc.) which provide medical benefit to insured persons,




58

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

According to the medical regulations, the payments to the panel
doctors for their services may be made on any of the following plans:
1. A capitation system or plan of payment on the basis of the
number or insured persons on the doctor’s list.
2. An attendance system or plan of payment on the basis of service
(or visits) actually rendered.
3. A combined system, in which capitation payments are made,
together with payment for special classes of service actually rendered.
4. Any modification of the preceding plans which the minister
may approve.

Part of the money collected for medical benefit is used for the
payment of expenses in providing drugs, medicines, appliances, etc.
Each insurance committee must report to the minister, at definite
times and in regular form, the amounts payable by them to persons
supplying drugs, etc. The minister then credits to the committee
the sums necessary, which they must keep in an account called the
drug fund and meet the bills due from it.
APPROVED SOCIETIES.

At the time of the enactment of the law of 1911, Great Britain was
covered by a network of friendly societies, trade-unipns, sick cliubs,
establishment funds, and similar voluntary organizations which pro­
vided a variety of benefits for sickness, accidental injury, death,
unemployment, and the like. ^ Many of these societies had a long
history of usefulness in providing relief from distress from these
causes and had developed a spirit of friendly aid to fellow members—
the “friendly.society spirit”—which made them valuable*and efficient
agencies for the protection of the standard of life in the communities
in which they operated. Their special activities were insurance or
relief in cases of sickness, death,, and unemployment, and their mem­
bers had had long experience in the handling of such insurance.. The
suggestion of broadening the activities of these organizations into a
national plan of insurance had been discussed for many years and in
1908 crystallized into a promise by the Liberal Party that such a plan
would be offered to Parliament.' When the plan was drafted, it was
decided to use these societies as carriers of the insurance, but in the
process to interfere with their activities as little as possible. In fact,
the competition between these societies for members and their rivalry
in offering benefits and securing good administration were referred to
as desirable qualifications for the work to be undertaken. The fact
that many of them had political, denominational, and social purposes
was well understood from the start, and they were offered participa­
tion in the insurance with this fact in view. The only fundamental
requirement exacted was that they should not be operated for profit
and that they should be democratically managed. .

The first step undertaken was to secure the cooperation of a suffi­
ciently large number of societies to bring the, insurance within the
reach of the poptilatibn to be insured. Part of this work was readily
accomplished because of the existing machinery of the societies for
reaching their members through meetings, periodicals, etc. To act
as a carrier of the insurance, these societies had to be designated as
“ approved societies” by the Higher authorities, namely, the Ministry




GENERAL, ADMINISTRATION.

59

of Health for England and Wales, and the corresponding bodies for
Scotland and Ireland.
This approval is given to—
1. Any society, that is, anv body of persons, corporate or unineororate (not
a branch oi another
body), registered
E underbeing act of Parliament or suchroyal charter. or estabshed
any
by
2. Any society not so registered or established which has a consti­
tution such as is prescribed by the ministry.
3. Any separate section established by any society for the purposes
of the insurance acts, consisting of insured persons and so constituted
as to comply with the requirements relating to approved societies.
4. Any new society.
5. Any establishment fund (“ employers’provident funds ”), subject
to certain conditions.
The approval may be withdrawn for failure to comply with the laws,
for offenses against any laws, or for maladministration of the society’s
affairs.
The first important part of securing approval is the submission of
the constitution, laws, and regulations of the society. Copies of these
documents must be submitted to the ministry, where they are
examined to ascertain whether they comply with the insurance laws
and regulations.
A frequent procedure is for a society to add a Part Two to its
organization; this is popularly called the “State side,” as distin­
guished from the “private side” for the conduct of the society’s regu­
lar business. By this arrangement the society merely adds a new
department to its organization; this additional department does not
cause any change in the existing arrangements as to meetings, gov­
ernment, etc. An important feature of the approval of a society is
the submission of their book of rules; these must receive special
approval and no changes may be made without the consent of the
ministry. For registered friendly societies, the approval of the chief
registrar of friendly societies is also necessary.
The plan of organization of the societies is the one usually provided
for such purposes; there must be a presiding officer, trustees, secre­
tary, treasurer and committee of management. As the general
executive officer, the secretary is the official with whom the insured
persons come into frequent contact and he is the one who communi­
cates with the insurance authorities. The treasurer is the custodian
of the uninvested funds of, the societies and makes all payments, for
which authority must be given. The trustees have the duty of hold­
ing and being responsible For all deeds, documents of title, and invest­
ment securities. They are the authorities to sue and be sued on behalf
of the society. The committee of management (board of directors,
executive committee, etc.), is appointed by the members for the gen­
eral policy and direction of the society’s business and for the supervi­
sion of its operations. There must also be arrangements for a general
meeting of members or for a series of district meetings in order that the
requisite democratic control of the society may be assured. Careful
records of the transaction of business relating to the state insurance
must be kept on file and open to the inspectors and auditors of the
ministry.
Membership.—Membership in a society, as far as the “State side”
is concerned, is a matter of contract; the applicant, by sending in a



60

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

proposal for membership, offers to pay his contributions through the
society and to conform to its rules. The society, by accepting this
offer, undertakes to pay him his benefits. The various classes of
members (contributors) are described on page 12. The termination
of this contract occurs when the member ceases to be insured.

Types o f societies.—An account of the varibus voluntary societies
providing sickness insurance is given in* the twentv-fourth annual
report of the United States Commissioner of Labor (Vol. II, p. 1550
ff.) This description also gives a historical account of some of the
Indre important societies and statistics of their operations down to
1909. By far the greater part of these organizations have elected to
become approved societies and are at present providing State insur­
ance; The latest available information as to the distribution of
the insured persons among these societies in England is contained in
the following table:

APPROXIMATE DISTRIBUTION OF MFMBERS OF APPROVED SOCIETIES AMONG THE
VARIOUS GROUPS OF SOCIETIES FOR THE HALF YEAR ENDED JUNE, 1919.
[Source: Second annual report of the Ministry of Health, 1920-21. London, 1921. Cmd. 1446. Page 153,]
Friendly Friendly
societies
Type of society and sex of members societies (central­
(branches). ized).
Societies approved by joint com­
mittee:
Men..................................................
Women... .V............... .1...............
Toted..*........................?............i.
Societies approved for operation in
England only:
Men............ .....................................
Women...........................................
Total..... ......................................
Total membership of approved so­
cieties in E ngland:
rWomen............................................
ry ■ „ ....... . . . . . . .
Total__ .
__..
—---------------- —---- i ...«---------.

Employ­ Totals for
Industrial
and col­ Trade- ers’prov­ all groups
lecting unions. ident of societies.
societies.
funds.

2,006,000 1,339,000 2,848,000
631,750 665,200 2,601,9U0
2,037,750 2,004,200 5,449,900
52,550
15,500
68,350

768,250
194,*50
962,700
i---

4,850
3,900
8,750

789,200 41,500 7,023,700
89,900 5,700 3,994,450
879,100 47,200 11,018,150
213,600 45,450
114,150 18,850
327,750 64,300

1,084,700
347,150
1,431,850

2,058,550 2,107,250 2,852,850 1,002,800 86,950 8,106,400
6*7,550 859,650 2,605, oOO 204,050 24,550 4,341?600
2,706,100 2,966,900 5,458,650 1,206,850 111,500 12,450?000

,f

Of the more than 12,000,000 insured persons in England, nearly
ofie-half are members of the two biasses of friendhf societies, while
over two-fifths are in the societies conducted by the industrial in­
surance companies and in the Societies called “ collecting societies.”
The trade-uiiions rank third in the number of persons included. In
the case of insured women it will be noted that over one-half of them
are included in the combined group of commercial insurance com­
panies*^Societies ^hd coUectingsbcieties.
The almOst mfinite variety of organizations Used as carriers is
illustrated by the names of the societies which, sent witnesses to tes­
tify before the departmental committee of 1916; a few of these names,
picked out at random, are :
Presbyterian Health Insurance Society.
General Federation df Trade Unions.
United Ancient Order of Druids Friendly Society.
National Union of Railwaymen,’srApproved Society.
■
British Steel Smelters’ Mill, Iron and Tinplate Workers’ Approved Society,




GENERAL ADMINISTRATION.

6 1

Independent Order of Odd Fellows, Manchester Unity Friendly Society.
Dublin Catholic Young Men’s Insurance Society.
Amalgamated Union of Cooperative Employees.
Scottish Women’s Friendly Society .
Hearts of Oak Benefit Society. |
National Union of Women Workers of Great Britain and Ireland.
National Federation of Women Workers.
“Achei Brith’’ (Brethren of the Covenant) Friendly Society.
Teachers’ Provident Society.
Prudential Approved Societies.
Order of Sons of Temperance Friendly Society.
St. Finbarr’s Diocesan Health Insurance Society.
Dublin Protestant Insurance Society.
Scottish Rural Workers’ Friendly Society .
Association of Approved Society Secretaries.
Bradford Municipal Officers’ Health Insurance Society.
Durham Miners’ Association Approved Society.
Orange and Protestant Friendly Society.
Scottish Clerks’ Association.

Transfers between societies.—When an insured person desires to give
up his membership in one society and to join another, he is entitled
to make this transfer, subject to certain restrictions. These restric­
tions are placed solely for the purpose of reducing the administrative
work, which is rather heavy, involved in making the changes in the
records of the society. A member may not, for instance, make the
change except at prescribed times, usually at the end of a contribu­
tion period and at intervals not greater than 27 weeks. To protect
a society which has a deficiency or which for other reasons objects
to such a transfer, the commissioners may, on receipt of objection
from the society and after giving the member opportunity to state
his reasons, decline to authorize such transfer. A society may also,
subject to the consent of the commissioners (i. e., the ministry), for­
bid any transfers for a period of not more than one year after a val­
uation which has shown a deficiency. If a person has been a mem­
ber of a society for less than two years, a fee may be charged for the
transfer. The restrictions are designed to prevent frivolous changes,
but*at the same time there is no desire to hinder members from join­
ing organizations which provide greater advantages because of better
management. When a personi transfers his membership, he takes
with him the accumulated rights of reserve values; these are called
“'transfer values” and are given in a series of tables published in the
1918 compilation of laws and regulations on pages 282 to 295. Two
comparatively recent regulations have been issued, containing the
rules for modifying these tables to make them conform to the 1920
act. The tables are too extensive to reproduce here.

ASSOCIATIONS OF SOCIETIES.

The law as planned did not exclude a society whose membership
was too small to afford an adequate basis for the insurance from
joining the system. They were, however, required to make some
sort of pooling arrangements with other small societies as a measure
of reinsurance. The 1911 act placed 5,000 members as the smallest
number with which a society might operate independently, but the
act of 1918 reduced this number to 1,000.
104936°—23—Bull. 312-----5




62

NATIONAL HEALTH INSURANCE IN GREAT BRITAIN.

The smaller societies are required to join a central association,
under the rules prescribed by the Ministry of Health; the association
must have a central financial committee to direct its operations in
regard to making good deficiencies shown after a valuation. In other
respects, these associations are to be treated as if they were societies
with branches.
In addition to these “pooling” associations, many approved so­
cieties have formed voluntary organizations or committees to pro­
vide for themselves accountants, auditors, nursing arrangements,
visiting of beneficiaries, the services of medical referees, etc.
THE DEPOSIT CONTRIBUTORS’ FUND.

Under the system of insurance carried on by the voluntary organi­
zations grouped under the term “ approved societies,” it was not
feasible to compel them to accept persons for membership against
their wishes, though the law prohibits any society from refusing ad­
mittance solely on the ground of age. Many of the approved soci­
eties for instance are trade-unions whose members must be engaged
in a specified craft, while other societies restrict their membership
On the basis of religious belief, etc. The framers of the law expected
that there would on this account be a large number of persons who
could not secure membership on this ground. It was also expected
that there would be a large number who could not secure admit­
tance because of impaired health; in fact it was expected that such
poor “risks” would form the major part of these unaffiliated persons
subject to the law. For all such persons, a special organization was
created, now called the deposit contributors’ fund, originally the postoffice fund. The first estimate of the framers of the law was that
such persons would number about 800,000 or 900,000. Later events
showed that nearly all of these estimates were incorrect. As a rule,
these societies have waived any right to a medical test of applicants
for membership and the result is that the members of the deposit
contributors’ fund differ in no important respect from the great body
of insured persons and their number has always been much smaller
than the original estimates of the framers of the law. The fund was
at first expected to be a temporary expedient only; the act of 1911
required that it be discontinued on January 1, 1915, but for a variety
of reasons the fund has been continued from year to year since that
date. In the debate in the House of Commons, the Minister of
Health in replying to the criticism that provision had not been made
to improve the condition of the deposit contributors, said (Commons
Debates, March 22, 1920, p. 218):
The deposit contributors are not such unfortunate persons as the honorable mem­
ber seems to think. They are in some respects the aristocracy of the insurance con­
tributors. They are, in the main, deposit contributors by their own choice. Many
societies would be glad to have them. Some of them have accumulated considerable
balances.

At another time the minister said (March 24, 1920):

There is no evidence of any general desire for the abolition of deposit contributors.
If at any time it is found that there is an appreciable number of insured persons un­
able to obtain admission to approved societies, I will refer to the insurance con­
sultative council the question of making some alternative arrangements.




OPERATIONS OF THE SYSTEM.

63

EXCESSIVE SICKNESS.

One of the broad powers of the insurance system is its authority
in regard to investigation of excessive sickness. Where the minister,
or an approved society, or an insurance committee, alleges that the
sickness for.which benefits must be paid is excessive, and that such
excess is due to the conditions or nature of the employment of such
persons, or to the bad housing or insanitary conditions in any locality,
or to an insufficient or contaminated water supply, or to the neglect
of the authorities (or any person) to observe or enforce any law
relating to the health of workers in industrial establishments, then
the insurance authorities may apply for an investigation, or the
minister may conduct one, for the purpose of determining whether
a claim is valid for the repayment of such excessive costs to the
insurance system. If, after proper inquiry, it is found that the ex­
cess of sickness exceeds the average by more than 10 per cent, then
the following reimbursements may be demanded:
1. If due to the neglect of an employer, it must be made good by
him.
2. If due to bad housing, or local insanitary conditions, or neglect
of a local authority to observe or enforce health laws, then the loss
must be made good by the local authority or by the person responsible
for the insanitary housing.

3. If due to insufficient or contaminated water supply, then the
loss must be made good by the local authority or water company
or person by whom the water is supplied.
The minister may recover such a sum by deducting it from the
local taxation account or by any other method of recovery.
OPERATIONS OF THE SYSTEM.

SOURCES OF INFORMATION.

The administrative authorities of the system have published
five reports on the operations of the system; the first was for the
year 1912-13, the second for 1913-14, the third for 1914-1917,
and the fourth, the first annual report of the Ministry of Health,
Part IY (Cmd. 913 of 1920), covers the period 1917 to March 31,
1920, while the second annual report (Cmd. 1446) covers 1920-21.
Aside from these five administrative reports, the available informa­
tion as to the working of the system is in such form that it is difficult
to summarize. The statistical information, so important in show­
ing the operations of an insurance system, is distinctly limited.
The almost entire independence of the four cduntries of the United
Kingdom is showrf by the fact that the reports contain no consolidated
statement for the latter. However, one summary statement of
especial value was published in connection with the work of an inves­
tigating committee. The absence of statements in the present
study as to the number of cases of sickness, duration and nature of
sickness, etc., is due to the fact that the data have not yet been
published. There is some information as to the working of the
sanatorium benefit, given on page 69, though this does not include
the duration of treatment given.



64

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

Two reports of special value are that of the investigating com­
mittee of 1916 and that of the Government actuary on the status
of the system in connection with the revision of benefits in 1920.
One of the most useful sources of information is the question
department of the House of Commons Debates; the information
presented depends on the nature of the question asked the Govern­
ment by the member who submits it, but it frequently happens that
the data so given contain facts which have not yet been published.
With the coming into force of the Ministry of Health Act of 1919,
the chief medical officer of that ministry began to publish an annual
report, which gave a systematic survey of health conditions in
England and Wales subject to the jurisdiction of the ministry. One
feature of this survey is the medical aspect of the insurance acts.
To date three of these reports have been issued, beginning with
that for 1919-20 (Cmd. 978). In these reports is the beginning of
a series of statistical summaries on the operations of the acts, though
as yet the data are distinctly limited in scope.
Under the terms of the central index committee regulations
(England) of August 29, 1922, a special body was created for the
purpose of keeping registers, records, etc., as the basis of statistical
and other reports on the insured and exempt persons affected by the
system. No reports have as yet been issued. A similar committee
for Wales was also created.
The accounts of the national health insurance funds are published
from time to time in separate papers presented to Parliament.
The latest available, published m 1920, brings the information
down to 1916.
The sanatorium benefit return is also made in a separate paper
and brings the information in rather brief form.
The budget statement of the Government is the best guide to
what is being done in the financial part of the system; the health
insurance part of the budget comes m Class VII.
As a means of showing the actual workings of the system, the
reports of the various approved societies have a distmct value;
sometimes the information given is so fragmentary as to have little
value as a contribution to the development of the system, but to
a foreign reader, the point of view and the matters of particular
interest emphasized are of real importance. For a few societies,
selected at random as instances of this material, the latest available
annual report has been given in condensed form.
NUMBER OF PERSONS INSURED.

The first full year of operation of the system was 1913; according
to the summary statement of the table on page 65, in this year
there were 9,394,961 men and 4,053,108 women, or a total of
13,448,069 persons in the insurance in 1913. During the years of
the war, it was deemed inadvisable to report on the number of per­
sons insured, but in connection with the bill of 1920, the Govern­
ment actuary made an estimate of the number of insured persons,
which is as follows:




65

OPERATIONS OF THE SYSTEM.

ESTIMATED NUMBER OF INSURED PERSONS, 1920.
[Source: Ministry of Health. National health insurance bill, 1920. Report by the Government actuary
upon the financial provisions of the bill. London, 1920. Cmd. 612. Page 5.]
Women.

Men.
Locality.
England...................................................................
Scotland...................................................................
Ireland......................................................................
Wales........................................................................
United Kingdom..........................................

Approved
Approved
Deposit
Deposit
societies. contributors. societies. contributors.

18,300,000
1,130,000

490.000
630.000
10,550,000

250,000
30.000

10.000
10,000

300,000

3,920,000
530.000
260.000
140,000
4,850,000

125,000
15,000
5.000
5.000
150,000

1Including persons entitled to benefits out of the navy and army insurance fund.

According to this estimate, the number of persons within the scope
of the insurance in July, 1920, was about 15,850,000, of whom
10.850.000 were men and 5,000,000, or 32 per cent, were women. The
number in England was 12,595,000, or not quite 80 per cent. Of the
total number of men insured, 8,550,000, or not quite 80 per cent, were
in England. Of the total number of women insured, 4,045,000, or
slightly over 80 per cent, were in England. The round figures used
indicate with emphasis the fact that these statements are estimates.

As stated above, the number of persons insured in societies in
1913 was 13,448,069; compared with the number for 1920, namely
15.400.000 (omitting the deposit contributors), there was an increase
of about 14 per cent in seven years. It is perhaps not accurate to
compare the details of the 1920 estimate with the actual returns of
1913, but with this reservation, the number of women in approved
societies increased from 4,053,108 to an estimated number of 4,850000 in 1920, an increase of about 20 per cent. The corresponding

increase for men was about 12 per cent. It is probable that the
changes resulting from war conditions are responsible for the more
rapid increase in the number of women insured.
EXPENDITURE FOR PECUNIARY BENEFITS.

The expenditures of the approved societies for sickness, mater­
nity, and disablement benefits in the years 1913-1916 were as follows:

EXPENDITURE OF APPROVED SOCIETIES FOR SICKNESS, MATERNITY, AND DIS­
ABLEMENT BENEFITS,,BY YEARS, 1913 TO 1916.
[Source: Interim report of the departmental committee on approved society finance and administration.
London, 1916. Cd. 8251. Page 37. Report on the administration of national health insurance during
the years 1914-1917. London, 1917. Cd. 8890. Pages 116 and 238. £ at par=$4.8665; penny=2.03
cents.]
Average expenditure
per week.
Country.

Number Sickness Mater­ Disable­ All pecu­
nity
of
ment
niary
members. benefit. benefit. benefit. benefits. Sick­
ness
bene­
fit.

Ma­
ter­
nity
bene­
fit.

£
d.
1913—Men:
£
£
£
d.
4,351,889 2.14 0.59
England................... 7,359,866 3,413,052 938,837
Scotland................... 1,026,649 422,564 137,332
559,896 1.90 .62
Ireland..................... 457,227 230,119 68,339
298,458 2.32 .69
400,516 2.70 .65
Wales....................... 551,219 322,377 78,139
United Kingdom. 9,394,961 4,388,112 1,222,647 |................ 5,610,759 2.16 .60




Dis­
able­ All
ment bene­
bene­ fits.
fit.
d.

d.

2.73
2.52
3.01
3.35
2.76
i

66

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

EXPENDITURE OF APPROVED SOCIETIES FOR SICKNESS, MATERNITY, AND DIS­
ABLEMENT BENEFITS, BY YEARS, 1913 TO 1916—Concluded.
Avt srage e:xpendi ture
per \veek.
Country.

1913— W omen:
England.......................
Scotland.......................
Ireland.........................
W alet............................
U nited K ingdom .
1914— Men:
England.......................
Scotland.......................
Ireland.........................
W ales............................
U nited K ingdom .
1914— Women:
England.......................
Scotland......................
Ireland.........................
W ales............................
U nited K ingdom .
1915—Men:
England.......................
Scotland.......................
Ireland...................
W ales............................
U nited K ingdom .
1915— W omen:
England.......................
Scotland.......................
Ireland.........................
W ales........................
U nited K ingdom .
1916—Men:
E ngland...................
Scotland......................
Ireland.........................
W ales............................
U nited K ingdom .
1916—W omen:
England.......................
Swm and.......................
I r e la n d .....................
W ales............................
U nited K ingdom .

1 Not reported.

N um ber Sickness Mater­ Disable­ A ll pecu­
n ity
of
m ent
niary
mem bers. benefit. benefit. benefit. benefits. Sick­
ness
bene­
fit.
£

3,290,807 1,756,610
431,404
199,068
221,432
148,145
62,752
109,465
4,053,108 2,166,575

£

31,995
7,031
2,304
1,579
42,909

•

£

£

1,788,605
206,099
150,449
64,331
2,209,484

d.

2.46
2.13
3.08
2.63
2.46

Ma- D is­
ter-— able­ A ll
nitjP m ent bene­
bene­ bene­ fits.
fit. fit.
d.

.04
.08
.05
.07
.05

d.

d.

2.50
2.21
3.13
2.70
2.51

7,537,794 3,944,065 956,917
1,033,276
507,233 144,309
474,544
73,139
253,809
84,974
579,948 378,629
9,625,562 5,083,736 1,259,339

115,958 5,016,940 2.41
17,443
668,985 2.26
3,367
330,315 2.46
473,253 3.38
9,650
146,418 6,489,493 2.43

.58 0.07
.64 .08
.71 .03
.76 .09
.60 .07

3.06
2.98
3.20
4.23
3.10

177,003
17,788
13,248
2,874
210,913

36,222 1,941,329 2.39
6,775
235,307 2.17
1,177
134,766 2.39
1,588
72,009 2.63
45,762 2,383,411 2.37

.24
.18
.26
.11
.23

.05
.07
.02
.06
.05

2.68
2.42
2.67
2.80
2.65

3,631,223 864,609
478,073 130,318
220,193 65,717
318,280 75,751
4,647,769 1,136,395

457,384 4,953,216 2.21
69,918 678,309 2.13
21,672
307,582 2.13
40,948
434,979 2.84
589,922 6,374,086 2.22

.53
.58
.64
.68
.54

.28 3.02
.31 3.02
.21 2.98
.37 . 3.89
.28 3.04

1,335,994
170,755
95,765
53,659
1,656,173

154,318
14,719
10,614
2,852
182,503

198,464 1,688,776 1.84
34,706
220,180 1.76
10,214
116,593 1.91
8,343
64,854 2.09
251,727 2,090,403 1.84

.21
.15
.21

.27
.36
.20

.20

.28

2.32
2.27
2.32
2.53
2.32

3,409,914 828,854
451,472 128,365
213,290 59,782
291,513
72,137
4,366,189 1,089,138

587,671 4,826,439
91,451
671,288 2.06
38,176
311,248
52,724 416,374
770,022 6,225,349

.58

.42

3.06

1,147,652
142,783
89,815
46,292
1,426,542

294,530 1,589,516
47,544
203,001 1.48
21,893
120,064
12,000
61,058
375,967 1,973,639

.13

.49

2.11

3,336,285 1,728,104
210,744
446,337
231,291
120,341
117,912
67,547
4,131,825 2,126,736

0
0
8
0
0
0
8
.8
0

147,334
12,674
8,356
2,766
171,130

.11

.33

As the insured persons were required to have been members for
26 weeks before tney became entitled to benefits for sickness and
maternity, no benefits on this account were payable until January,
1913, as the 1911 act came into operation on July 15, 1912. Dis­
ablement benefit requires membership for 104 weeks, so that this
feature came into the expenditures in July, 1914. Several changes
were made in the maternity benefit and in the practice of the payment
of sickness benefit to women in 1913 and 1914, so that comparisons
with these years must be made with caution.



67

OPERATIONS OF THE SYSTEM.

The data of most interest in the table are those relating to the
expenditure per member per week for .benefits, which include only
the years 1913 to 1915, for reasons already stated. The sickness
benefit per week for men was highest in 1914 with 2.43d. (4.9 cents,
par), and lowest in 1913 with 2.16d. (4.4 cents, par). The sickness
and maternity benefit payments have been varied so much by changes
in the law and in the practice of the societies that the figures for the
different years are not comparable, but it is of interest to* note that
in Scotland the expenditure was decreasing from 1914 to 1916.
The changes which the act of 1920 will cause in the expenditure
for benefit were estimated by the Government actuary to be as
follows:
ESTIMATE OF EXPENDITURE FOR BENEFITS, JULY, 1920, TO JULY, 1921.
[Source: Ministry of Health. National health insurance bill, 1920. Report by the Government actuary
upon the financial provisions of the bill. London, 1920. Cmd. 612. (Page 9. £ at par=$4.8665.)
At rates of benefit existing up to July 5, 1920.
Country.

Approved societies.
Men.

England................................................................... £11,356,000
Scotland................................................................... 1,556,000
510.000
Ireland......................................................................
856.000
Wales........................................................................
United Kingdom.......................................... 14,278,000

Women.
£4,804,000
617.000
235.000
157.000
5,813,000

Deposit con­
tributors.
£224,000
27.000
5,000

10.000

266,000

Total.

2

£16,384,000
,200,000
750,000
1,023,000
20,357,000

At new rates of benefit effective July 5, 1920, under act
of May 20, 1920.
England.................................................................... £15,967,000
Scotland................................................................... 2.190.000
721,000
Ireland......................................................................
.202.000
Wales........................................................................
United Kingdom.......................................... 20,080,000

1

£6,786,000
876.000
341.000
224.000
8,227,000

£294,000
34.000

6,000
12.000

346,000

£23,047,000
3.100.000
1.068.000
1,438,000
28,653,000

Increase in expenditure after July 5,1920.
England............. ..................................................... £4,611,000
634.000
Scotland...................................................................
Ireland......................................................................
346,000
Wales........................................................................
United Kingdom.......................................... 5,802,000

211.000

£1,982,000
259.000
106.000
67,000
2,414,000

£70,000
7.000

1.000
2,000

80,000

£6,663,000
900.000
318.000
415.000
8,296,000

According to these estimates, the total amount which would have
been expended for pecuniary benefits under the rates of benefit
used in the table on page 25 was £20,357,000 ($99,067,341, par) in
1920; under the new rates of benefit, this amount is expected
to be £28,653,000 ($139,439,825, par), an increase of £8,296,000
($40,372,484, par), or about 41 per cent. The approved societies
will pay the insured men about this per cent of increase, while for
women the increase will be about 42 per cent.
The 1922 annual report of the chief medical officer of the Ministry
of Health presents for the first time a summary of the expenditures



68

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

for sickness and for disablement benefits in England and Wales
during the years 1913 to 19^1. The data are as follows:
EXPENDITURES OF APPROVED SOCIETIES (ENGLAND AND WALES) FOR SICKNESS
AND DISABLEMENT BENEFITS, 1913 TO 1921.
[Source: Annual report of the chief medical officer of the Ministry of Health for the year 1921. London,
1922. Page 26. £ at par=$4.8665. The figures for 1920 and 1921 are subject to adjustment.]
Year.
19131............................................................
19141............................................................
19151............................................................
19161............................................................
1917..............................................................
1918..................................... ........................
1919..............................................................
19204............................................................
1921*............................................................
Total, 9 years...............................
Average per annum................................

1
3
8

Sickness benefit.
Men.
£3,623,220
4,019,187
*3,141,548
*2,683,782
*2,463,196
*2,842,753
*3,066,342
3,667,081
4,810,470
30,317,579
3,368,620

Disablement benefit.

Women.

Men.

£1,770,371
1,732,327
1,393,402
1,176,181
1,157,523
1,441,639
1,319,201
1,678,092
2,271,662
13,940,398
1,548,933

3£124,212
514,681

655,241
713,124
739,029
779,854
1,104,621
1,669,985
6,300,747
840,100

Women.

3£36,781
210,573

308,688
358,783
396,868
434,499
629,890
981,746
3,357,828
447,710

The figures for 1913 to 1916 do not agree with those for England and Wales in the table on page 65,
which are taken from a different source. *
Disablement benefit became payable for the first time in July, 1914.
These figures are lower than they would have been had not a considerable proportion of the total male
insured population been serving with the Forces. The rise in years 1918-19 is attributable to the influ­
enza epidemic in those years ana (1919) to the return of men from the Forces to civil life; toward the close
of 1921 a further influenza epidemic caused an abnormal sickness experience in certain parts of England,
particularly in Yorkshire.
During second half-year of 1920 higher rates of benefit under the National Health Insurance Act (1920)
were paid. For comparison with previous years* expenditure at the old rates, the figures for the year
should be reduced by approximately 20 per cent (women's sickness, approximately 22fc per cent).
During second half-year of 1921 varying increased rates of benefit were paid as additional cash benefits
by certain societies out of disposable surpluses declared at the first valuation. It has not been found
possible at present to fix a reliable percentage as representing this increase, but, apart from this, for com­
parison with previous years* expenditure at the old rates in force prior to July, 1920, the figures for the
year 1921 should be reduced by approximately 33J per cent (women’s sickness benefit, approximately
37J per cent).

4
6

The report (page 27) makes the following comment on the table:

From this table it is seen that the average amount (based on the figures for the last
9 years) paid annually in England and Wales to men for sickness benefit was
£3,368,620 [$16,393,389, par]. The corresponding amount paid for disablement
benefit was £840,100 [$4,088,347, par]. Disregarding the increased rates of benefits
paid by certain societies from July, 1921, by way of additional benefits out of their
disposable surpluses on valuation, and taking the maximum ordinary rates of sickness
and disablement benefit payable to men (namely, for sickness benefit 10s. [$2.43, par]
per week prior to July 5, 1920, and 15s. [$3.65, par] per week after that date, ana for
disablement benefit 5s. [$1.22, par] per week and 7s. 6d. [$1.83, par] per week, respec­
tively), these figures represent an average minimum of 6,217,927 weeks of sickness
per annum under sickness benefit, and 2,945,686 weeks under disablement benefit,
making a total of 9,163,613. For women, the corresponding figures represent an
average annual minimum of 3,763,340 weeks7 sickness benefit and 1,549,121 disable­
ment benefit, making a total of 5,312,461 weeks.
Thus, at least 14,476,000 weeks7work are lost on an average every year through
sickness; or a period of upward of 278,000 years. That is to say, in England and
Wales there is lost to the nation every year, among the insured population only, and
excluding the loss due to sickness for which sickness or disablement benefit is not
payable, the equivalent of the work of 278,000 persons. Moreover, it must be remem­
bered that it is not only the working equivalent of 278,000 persons that the nation
loses every year, but also the labor ana expense involved in their care during the
14,476,000 weeks of their incapacitation. To this loss of time and capacity among the
14.000. 000 insured persons we must, to obtain the national loss, add a comparable
loss, though persumably not so large a proportional loss, in respect of the remaining
23.000. 000 persons (including children) which comprise the total population.




69

OPERATIONS OF THE SYSTEM.

SANATORIUM BENEFIT.

In the House of Commons on December 17, 1919, the Minister of
Health frankly stated that in his opinion the results obtained by the
sanatorium benefit under the insurance acts were not satisfactory to
him and that it would take a generation before Great Britain could
catch up with the needs of the population. Circumstances connected
with the war, he stated, were largely the cause of the incomplete
success of the measures inaugurated under the insurance acts for
combating tuberculosis. The minister gave the following summary
statement of the number of persons who had received sanatorium
treatment in England and Wales: In 1914, 31,793; 1915, 29,741;
1916, 29,850; 1917, 31,566; 1918, 35,430.
A more complete statement of operations in the United Kingdom
is given in the latest available report on this feature of the insurance
system. The following table'shows the number of persons given
treatment in the years 1917 and 1918:

NUMBER OF INSURED PERSONS AND DEPENDENTS OF INSURED PERSONS RECEIV­
ING SANATORIUM BENEFIT, AND NUMBER OF APPLICATIONS FOR SANATORIUM
BENEFIT, 1917 AND 1918.
[Source: National Health Insurance Joint Committee. Return as to the administration of sanatorium
benefit, 1917-18. London, 1919. Cmd.232. Pages 3 and 6. In this table a person who received treatment
within the period appears once, and once only, even though he received treatment in more than one
form, except in the case of a person who, owing to a change of residence during the period, received treat­
ment under arrangements made by more than one committee. Persons whose course of treatment
began prior to first of January and continued into the year following do not appear in the table for the
succeeding year.]
1917
Number of applicants—
Received treatment.
Whose
applica­
Not
recom­
tions
were Whose mended Not
received applica­ for
treated
Country and sex.
before
reasons
for
Jan. 1, tions
other reasons Pulmo­ Nonpulwere
but who received tljan such as nary monary Total.
did not during those of those cases.
cases.
receive the
health; stated in
treatment period. e. g.,
foot­
till on
appli­ note.1
or after
cant not
that
insured.
date.
England:
Males.......................................
507 20,890
146
2,073 18,175
1,003
19,178
264 9,504
82
806
Females..................................
8,029
851
8,880
771 30,394
2,879 26,204
Total....................................
228
1,854
28,058
Scotland:
Males.......................................
72 2,576
155
234
2,259
2,188
71
Females * .............................
42
1,152
84
956
1,024
239
320
139
Total....................................
114 3,728
3,144
3,283
Ireland:
Males.......................................
53
2,096
51
1,700
196
1,896
32
Females..................................
1,507
53
1,139
209
1,348
138
Total....................................
85
3,603
104
340
2,839
405
3,244
Wales:
Males.......................................
2,243
581
356
4,550
1,887
Females..................................
586
2,602
1,923
940
1,265
325
7,152
4,811
3,508
Total.................................... 1,167
2,827
681
United Kingdom:
Males....................................... 1,213 30,112
25,576
352
5,397 23,950
1,626
Females..................................
219
924 14,765
12,517
2,953 11,064
1,453
Total.................................... 2,137 44,877
571
8,350 35,014
3,079
38,093

86
202

68

2,888

1 On expert examination found not to be suffering from tuberculosis; removed to another area, and
accordingly do not appear as receiving treatment in the area in which application was first made; declined
the treatment for which nominated; application under consideration on Dec. 31.



to

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

NUMBER OF IOSURED PERSONS AND DEPENDENTS OF INSURED PERSONS RECEIV­
ING SANATORIUM BENEFIT, AND NUMBER OF APPLICATIONS FOR SANATORIUM
BENEFIT, 1917 AND 1918—Concluded.
1918
Received treatment:

Number of applicants—

Country and sex.

England:
Males.......................................
Females..................................
Total............................. .
Scotland:
Males......................................
Females..................................
Total...................................
Ireland:
Males.......................................
Females..................................
Total....................................
Wales:
Males......................................
Females..................................
Total...................................
United Kingdom:
Males.......................................
Females..................................
Total....................................

Whose
applica­
tions
were
received
before
Jan. 1,
but who
did not
receive
treatment
till on
or after
that
date.

Whose
applica­
tions
were
received
during
the
period.

Not
recom­
mended
for
reasons
other
than
those of
health;
e. g.?
appli­
cant not
insured.

1,023
348
1,371

24,904
9,475
34,379

506
149
655

2,465
785
3,250

21,869
8,104
29,973

1,087
785
1,872

22,956
8,889
31,845

93
30
123

3,013
1,065
4,078

175
57
232

441
104
545

2,414
862
3,276

76
72
148

2,490
934
3,424

87
66

41
45

153

2,132
1,082
3,214

.429
165
594

1,526
771
2,297

223
167
390

1,749
938
2,687

765
671
1,436

5,296
2,528
7,824

2,010

5,675

2,019
911
2,930

377
278
655

2,396
1,189
3,585

1,968
1,115
3,083

35,345
14,150
49,495

7,000
3,064
10,064

27,828
10,648
38,476

1,763
1,302
3,065

29,591
11,950
41,541

86

Not
treated
for
reasons Pulmo­ Nonpulsuch as nary monary Total.
those cases. cases.
stated in
foot­
note.

3,665
722
251
973

As no information is available as to the whole number of insured
persons suffering from tuberculosis, it is not possible to make any
comparison which would show how completely the treatment af­
forded met the needs of the insured population. In the House of
Commons debates already referred to, the minister stated that all
persons recommended for treatment were receiving it, but that the
question of securing proper treatment for each case at a sufficiently
early stage is dependent upon a correct diagnosis being made ana
upon the willingness of the patient to accept the appropriate form
of treatment in the early stages of the disease.
The class of treatment (residential, dispensary, and home treat­
ment) afforded to the insured persons in 1917 ana 1918 is as follows:




71

Ot’ERATTO'N'S OF THE SYSTEM.

NUMBER OF CASES OF TUBERCULOSIS RECEIVING TREATMENT DURING 1917 AND 1918.
[Source: National Health Insurance Joint Committee. Return as to the administration of sanatorium
benefit, 1917-18. London, 1919. Cmd. 232. Pages 3 and 6. A person receiving treatment under more
than one heading appears in this table as a separate case under each heading. Persons whose treat­
ment began before Jan. 1 and continued into the year following are included.]
Country and sex.

1917

1918

Residential. Dispensary. Domiciliary. Residential. Dispensary. Domiciliary.

England:
Males..........................
Females.....................
Total.......................
Scotland:
Males..........................
Females.....................
Total.......................
Ireland:
Males..........................
Females.....................
Total.......................
Wales:
Males..........................
Females.....................
Total.......................
United Kingdom:
Males..........................
Females.....................
Total.......................

16,582
7,372
23,954

19,314
10,615
29,929

23,638
12,475
36,113

19,925
7,336
27,261

24,365
11,189
35,554

27,881
12,864
40,745

2,409
1,056
3,465

269
163
432

616
362
978

2,553
943
3,496

395
154
549

773
390
1,163

1,381
564
1,945

501
421
922

1,463
1,883
3,346

1,388
492
1,880

607
404

1,011

1,590
1,877
3,467

2,006
1,085
3,091

2,138
1,701
3,839

1,710
955
2,665

1,990
1,008
2,998

2,386
1,610
3,996

1,837
1,053
2,890

35,122

27,427
15,675
*43,102

25,856
9,779
35,635

27,753
13,357
41,110

32,081
16,184
48,265

22,378
10,077
32,455

22,222
12,900

The results of the treatment provided the cases enumerated in
the preceding table were as follows:

ANALYSIS OF CASES OF DISPENSARY AND RESIDENTIAL TREATMENT, 1917 AND 1918.
[ Source: National Health Insurance Joint Committee. Return as to the administration of sanatorium
benefit, 1917-18. London, 1919. Cmd. 232. Pages 4 and 7. The figures in columns 2, 3, and 5 do not
show tne number of cases in which the treatment of the patient was concluded, since, after ceasing to
attend the dispensaries, patients may receive continued treatment in other forms. The figures in col­
umn 5 relate to cases as to the progress of which no definite report is available for various reasons, e. g.,
the withdrawal from the dispensary treatment of the insured persons themselves before the expiration
of the period recommended.]
Dispensary treatment.

Country and sex. Total
cases
treat' ed.

1917
Discharged
from
Treat­ Still
institution.
ment under
discon­ treat­
With­ Died. tinued ment
Im­ out
in
on
prov­ im­
other Jan. 1,
ed. prove­
cases. 1918.
ment.
(2) (3) (4) (5) (§)

(U
England:
Males................. 19,314 2,278 985 1,508 1,998 12,545
Females............ 10,615 1,385 543 673 1,068 6,948
Total.............. 29,929 3,663 1,528 2,181 3,084 19,493
Scotland:
Males................
269 57
15 23
13 161
Females............ 163 41
3
5 103
Total.............. 432 98
18 34
18 264




11

Total
cases
treat­
ed.
(1)

1918
Discharged
from
Treat­ Still
institution.
ment under
discon­ treat­
With­ Died. tinued ment
Im­ out
in
on
prov­ im­
other Jan. 1,
ed. prove­
cases. 1919.
ment.
(2) (3) (4) (5) (6)

24,365 2,438 1,033 1,674 2,140 17,050
11,189 1,297 480 795 870 7,747
35,554 3,735 1,543 2,469 3,010 24,797

19
21 10 22 19 254
13
8 102

395 81
154
549 192

29

35

27

353

*72

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

ANALYSIS OF CASES OF DISPENSARY AND RESIDENTAL TREATMENT, 1917 AND 1918Concluded.
Dispensary treatment.
1918

1917
Discharged
from
institution.

Country and sex. Total
cases
treat­
ed. Im­
prov­
ed.
(1)
Ireland:
Males................
Females............
Total..............
Wales:
Males................
Females............
Total..............
United Kingdom:
Males................
Females............
Total..............

Treat­
ment
discon­
Died. tinued
in
other
cases.

With­
out
im­
prove­
ment.
(2) (3) (4)

501 95
421 76
922 171

14
9
23

34
18
52

68

2,13$ 633 175
1,701 509 • 122 56
3,839 1,142 297 124

22,222 3,063
12,900 2,0
11

(5)
126
141
267

Still
under
treat­
ment
on
Jan. 1,
1918.
(6)
232
177
409

Discharged
from
institution.

Total
cases
treat­
ed. Im­
prov­
ed.
(1)

Treat­ Still
ment under
discon­ treat­
Died. tinued ment
on
in
other Jan. 1,
cases. 1919.

With­
out
im­
prove­
ment.
(2) (3) (4)

607 145
404 87
232

1,011

95 1,167 2,386 863
58 956 1,610 579
153 2,123 3,990 1,442

17
13
30

39
19
58

149 85
109 73
258 158

(5)

(6)

163
118
281

243
167
410

86

140 1,149
763
228 1,912

1,189 1,633 2,232 14,105 27,753 3,527 1,248 1,820 2,462 18,696
677 758 1,270 8,184 13,357 1,984 612 900 1,082 8,779
35,122 5,074
2,391 3,502 22,289 41,110 5,511 1,860 2,720 3,544 27,475

1,866

Residential treatment.
England:
Males.................
Females............
Total..............
Scotland:
Males.................
Females............
Total..............
Ireland:
Males.................
Females............
Total..............
Wales:
Males................
Females............
Total..............
United Kingdom:
Males.................
Females............
Total..............

16,582 9,328 1,813 1,140 841 3,460 19,925 11,624 2,410 1,194
7,372 4,317 795 412 237 1,611 7,336 4,127 961 479
23,954 13,645 2,608 1,552 1,078 5,071 27,261 15,751 3,371 1,673

848 3,848
162 1,608
5,456

1,010

2,409 1,099
1,056 504
3,465 1,603

284 328
134 124
418 452

153
25
‘178

545 2,553 1,044
269 943 413
814 3,496 1,457

275 311
113 136
388 447

194
32
226

729
249
978

1,381 685
564 302
1,945 987

194 132
74 53
268 185

108
23
131

262 1,388 764
492 271
374 1,880 1,035

112

208 141
87 52
295 193

87
17
104

188
65
253,

2,006 1,118
1,085 539
3,091 1,657

114
100

214
105
319

426 1,990 1,082
279 1,008 526
705 2,998 1,608

125 154
81 44
206 198

232
107
339

397
250
647

134
62
214 196

22,378 12,230 2,405 1,734 1,316 4,693 25,856 14,514 3,018 1,800 1,361 5,162
10,077 5,662 1,103 651 390 2,271 9,779 5,337 1,242 711 318 2,172
32,455 17,892 3,508 2,385 1,706 6,964 35,635 19,851 4,260 2,511 1,679 7,334

It will be noted that the results of the treatment are stated with
reserve; none is reported as “cured” but only as “improved” at the
conclusion of treatment.
The total amounts expended by the insurance committees in their
administration of the sanatorium benefit in 1917 and 1918 were as
follows:



73

OPERATIONS OF THE SYSTEM.

APPROXIMATE EXPENDITURE OF INSURANCE COMMITTEES ON THE PROVISION OF
SANATORIUM BENEFIT, INCLUDING PAYMENTS TO PRACTITIONERS IN RESPECT
OF DOMICILIARY TREATMENT, BUT EXCLUDING THE COST OF ADMINISTRATION,
1917 AND 1918.
[Source: National Health Insurance Joint Committee. Return as ter the administration of sanatorium
benefit, 1917-18. London, 1919. Cmd. 232. Pp. 5 and 7. £ at par=$4.8665.]
England. Scotland.
£619,000
664,000

£93,000
105,000

Ireland.
£42,000
42,000

United
Kingdom.
£42,000 £796,000
43,000
854,000

Wales.

These sums represent only the expenditures of the insurance com­
mittees for the insured persons. In the House of Commons on Decem­
ber 17, 1919, the Minister of Health stated that the total expenditures
in England and Wales by public authorities during the year ending
March 31, 1918, for the total population, was approximately
£1,550,000 ($7,543,075, par). In the above table the expenditure in
England and Wales in the calendar year 1917 was £661,000
($3,216,757, par) for the insured population. Presumably “public
authorities77 does not include the insurance committees, so that the
two countries show an expenditure of over £2,000,000 ($9,733,000,
par) for the relief of tuberculosis in 1917.
As stated before, the Minister of Health regards the provision of
facilities for treating tuberculosis as insufficient, a large part of the
^shortage being due to causes connected with the war; presumably
he referred to the fact that practically all building was suspended
after August, 1914, and the contemplated chain of sanatoriums which
Mr. Lloyd George in 1911 said would be constructed was never
realized. However, the actual number of beds in use for insured
persons is at least a substantial number, as the following table shows:

SUMMARY OF INSTITUTIONAL PROVISIOlN: ENGLAND, SCOTLAND, AND IRELAND,
1917 ANjD 1918.
[Source: National Health Insurance Joint Committee. Return as to the administration of sanatorium
•
benefit, 1917-18. London, ipi9. Cmd. 232. Pp. 5 and 8.]
(2)
(3)
(4)
(1)
of beds re­
Number of Number to insurance Total number of beds
served
beds to
committees under for insured and
which in­ provisional arrange­ insured in— non­
Number of
surance
approved
Country and year.
committees ments with—
tuberculo­
were en­
____ 1_.____________
_
sis dis­
titled under
1
Local au­
pensaries.
permanent
arrange­ Local Au­ Voluntary thorities’ Voluntary
institu­
ments. thorities. tions direct. institu­ institu­
tions.
tions.
England^
5,937
6,163
373
|387
309
3,564
1917.......................................
6,749
6,385
375
437
248
1918.......................................
3,517
Scotland:
647
23
2,051
437
137
28
1917.......................................
671
23
142
24
1918.......................................
445
Ireland:
2,176
2,251
175
249
14
1917.......................................
3,262
3,171
180
24
16
1918.......................................
250
The numbers shown in columns (1) and (2) represent accommodation secured under general arrangements
as distinct from arrangements for individual patients. In addition to the accommodation so secured,
beds are obtained by insurance committees for individual patients as and when required out of the total
approved accommodation (figures of which are givefnin column (3)) available for the treatment of persons
suffering from tuberculosis, whether insured or noninsured.
In the case of England, the figures in all columns are stated as of Jan. 1,1918 and 1919. The figures in
columns (3) and (4) are supplied by the local government board and represent minimum figures for the
date mentioned.
In the case of Scotland, the figures in all columns are stated as of Dec. 31,1917; and in the case of Ireland
as of Jan. 1, 1918. The figures for Ireland in column (3) represent beds not specially reserved for the
treatment of tuberculosis.




6

2,121

74

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN,

SUMMARY OF INSTITUTIONAL PROVISION: WALES, 1917 AND 1918.
[Source: National Health Insurance Joint Committee. Return as to the administration of sanatorium
benefit, 1917-18. London, 1919. Cmd. 232. Pages. 5 and 8.]
Total number of beds
Number of rented by the K. E.
beds be­ S. W. N. M. Asso­
longing to ciation in—
or rented
by the K.
E. S. W. Local au­
N. M. As­ thorities’ Voluntary
sociation. institu­ institu­
tions.
tions.

December.

1917.............................................
1918..............................................

965
1,012

88

85

Total num­
ber of beds Total num­ Total num­
belonging ber of ap­ ber of visit­
to the K. proved dis­ ing sta­
E. S. W.
N. M. As­ pensaries. tions.
sociation.

121
101

756
836

14
13

86
81

N ote.—In Wales, the provision of treatment for insured and noninsured persons suffering from
tuberculosis was undertaken by the King Edward VII Welsh National Memorial Association under agree­
ments with all the Welsh insurance committees and arrangements with 16 (out of 17) Welsh county and
county borough councils. The number of beds available for insured persons can not be given separately
and the figures for Wales in the appended table represent the beds available for insured and nomnsurea.
The figures in all columns are for December.

According to a statement in a review of the insurance system
(published in the New Statesman, March 14, 1914, Supplement, p.23),
the proportion of beds to population should be about one per thousand;
perhaps this ratio should not be used for insured persons, because of
the high rates of tuberculosis during the early working years of life,
but if it is taken as approximately correct, then the 12,000,000
insured persons in England had about 4,200 beds reserved for them
in 1918 by the insurance committees, or approximately one-third of
the standard above mentioned. The table following, however, shows
that some of the facilities available for both insured and noninsured
ersons
E were used by the committees for those entitled to sanatorium
enefit.
APPROXIMATE NUMBER OF BEDS OCCUPIED AT ONE TIME BY INSURANCE COM­
MITTEE'S PATIENTS IN 1918.
[Source: National Health Insurance Joint Committee. Return as to the administration of sanatorium
benefit, 1917-18. London, 1919. Cmd. 232. Page 8.)
Country.
England............................
Scotland1..........................
Ireland..............................
Wales................................
Total.........................

Discharged
soldiers, Other per­
etc., en­ sons en­
titled to titled to
priority of sanatorium
residential benefit.
treatment.
1,915
365
85
148
2,513

3,940
646
310
576
4,572

Total.

1,011

5,855
395
724
7,985

For Scotland, the figures are stated for Dec. 31,1918,

FINANCIAL OPERATIONS.
SUMMARY OF RECEIPTS AND EXPENDITURES.

In connection with an inquiry from a member of Parliament, the
following statement of the total amount expended on benefits and on
administration, from 1911 to 1918, was presented and published in
House of Commons Debates, April 7, 1919.



75

OPERATIONS OF THE SYSTEM.

APPROXIMATE EXPENDITURE ON NATIONAL HEALTH INSURANCE, INCLUDING
BENEFITS IN CASH AND IN KIND AND COST OF ADMINISTRATION, FROM THE COM­
MENCEMENT OF THE ACT UP TO MARCH 31, 1919.
[£ at par==$4.8665.]
Country.

Moneys Moneys from
provided by contri­
Parliament. butions.
(a)
(b)

2
2

England................................................ .......................................... £29,200,000 £51,800,000
Wales.................................................................................................
,100,000
3.700.000
Scotland............................................................................................. 4.200.000
7.200.000
Ireland............................................................................................... 2.300.000
2.300.000
Joint committee working in all parts of the United Kingdom..
.200.000
Total........................................................................................ 40,000,000 65,000,000

Total.
(c)
£81,000,000
5.800.000
11,400,000
4.600.000
.200.000
105,000,000

2

(a) includes (1) all expenditures from moneys provided by Parliament under
sections 3, 4, 16 (2, b), 46, 47, 48, 49, 53, and 81 (10) and (11) of the national insur­
ance act, 1911, and section 3 (2) of the national insurance (Part I amendment) act,
1915 (subhead G of the vote for the joint committee, subheads F, G, H, J, and L, of
the votes for the several insurance commissions); (2) all the supplementary grants
under sections 1 and 31 of the national insurance act, 1913, and sections 2 and 4 of
the national health insurance act, 1918 (subheads A to F of the national health insuance (special grants) vote for the years 1912-13 and 1913-14, subheads E, F, and H
to N of the vote for the joint committee, and subhead K of the vote for the several
insurance commissions), and (3) the central administration (i. e., of the joint com­
mittee and the four commissions, staffs, subheads A to D of the vote for the joint
committee, subheads A to E of the votes for the several insurance commissions, and
sundry subheads of the votes for various other Government departments, e. g., office
of works, stationery office, post office, etc.).
(b) and (c) include expenditure from the joint contributions of employers and
employed persons (of which it is estimated that 55 per cent is paid by the employed
persons), and such small amount of expenditure as can properly be considered to
have been met from interest on investments.

Included in column (a) are sums amounting to approximately
£2,380,000 ($11,582,270, par) which have been spent from moneys
provided by Parliament for the extension of sanatorium benefit to
dependents of insured persons under section 17 of the national insur­
ance act, 1911, and for the treatment of tuberculosis generally.
In addition to the above there are sums of £300,000 ($1,459,950,
par) from the exchequer and £66,000,000 ($321,189,000, par) from the
contributions that have been placed in reserve and invested, under
section 4 of the national health insurance act, 1918, and section 56 of
the national insurance act, 1911, respectively, to meet future liabili­
ties.
According to this statement, out of the £105,000,000 ($510,982,500,
par) expended on the system, Parlian^ent provided £40,000,000
($194,660,000, par), or 38 per cent, and the employers and insured
persons provided 62 per cent. This statement, However, should be
considered in connection with the fact that these amounts are expen­
ditures and not receipts. The paragraph above shows that £66,000,000 ($321,189,000, par) from contributions have been placed in the
reserves to meet future liabilities; the amount from contributions
placed in the reserve is apparently slightly more than is expended for
benefits and administration.
There is not available a similar statement as to the receipts of the
system since its commencement, but the following summary state­
ment shows the amount received and expended in England during the
year 1920.




76

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

S um m ary of A ppro xim ate R eceipts a n d P aym ents U n d e r th e N ational H ealth
I n su r a n c e A cts (E n g l a n d ) for the Y e a r 1920.5

[£ at par = $4.8665.]
Accumulated funds at beginning of year:
Invested with national debt commissioners............................................ £39,168,000
Investments made by or on behalf of approved societies................... 20,954,000
Cash at Bank of England......................................... ....................................
361,000
Cash in hands of approved societies and insurance committees........ 1,137,000
Receipts:
Contributions of employers and employed persons............................... 18,815,000
Exchequer (including statutory proportion of benefits, sundry
grants-in-aid, and cost of central administration)..............................
7,728,000
Interest and sundry receipts................................................................................ 2,787,000
90,950,000
Payments:
Medical and sanatorium benefits (including £7,159,000 remuner­
ation of medicalpractitioners).................................................................. 9,217,000
Sickness, disablement, andmaternity benefits.......................................
8,353,000
Administration expenses—
Approved societies......................................................... £2,646,000
Insurance committees...................................................
437,000
Central administration..................................................
660,000
------------------ 3,743,000
Accumulated funds at end of year:
Invested with national debt commissioners................... 41,618,000
Investments made by or on behalf of approved socie­
ties........................................................................................... 25,073,000
Cash at Bank of England........................... ..........................
936,000
Cash in hands of approved societies and insurance
com m ittees..................... ..................................................... 2,010,000
------------------ 69,637,000
90,950,000
z

Expenditure in connection with national health insurance in
England is also incurred by other Government departments in
respect of office accommodation (buildings, furniture, fuel, and light),
rates, stationery and printing, postage, telegrams, telephones,
national insurance audit department, and miscellaneous services.
The estimated cost of these services in 1920 was £435,000 ($2,116,928, par).
RESERVES ON MARCH 31, 1920.
The reserves which have been gradually accumulating under the
regulations of the system had reached the following sums on March
31, 1920, according to House of Commons Debates, June 3, 1920,
page 2085:
* at par=$4.8665.]
[£
The moneys accumulated under the national health insurance acts up to March 31,
1920, are as follows:
Investments in the hands of approved societies or invested on their
behalf in securities selected by them (under sec. 56 of the national
insurance act, 1911) (cost)................................................................................ £29,000,000
Investments in the hands of th e national debt commissioners (under
sec. 54 of the national insurance act, 1911) (cost)..................................... 47,500,000
Balances of cash in the several national health insurance funds and in
the hands of approved societies and insurance committees.................... 1, 500,000
Total............................................................................................................... 78,000,000
•Ministry of Health. Second annual report, 1920-21. Cmd. 1446. P.210.



77

OPERATIONS OF THE SYSTEM.

INCOME IN 1920.

The income of the system in the year 1920 under the rates of con­
tribution prior to the enactment of the 1920 law, and the income
under the new rates, were estimated by the Government actuary as
follows:
ESTIMATED ANNUAL CONTRIBUTIONS BEFORE AND AFTER JULY 5, 1920.
[Source: Ministry of Health. National health insurance bill. 1920. Report by the Government actuary
upon the financial provisions of the bill. London, 1920. ' Cmd. 612. Page 6. £ at par=$4.8665.1
Before July 5, 1920.
Country.

Employers.

Insured
persons.

After July 5, 1920.
Employers.

Insured
persons.

Increase.
Insured
Employers. persons.

England......................... £7,388,000 £9,082,000 £12,314,000 £11,545,000 £4,926,000 £2,463,000
1,566,000
1,670,000
668,000
334.000
Scotland......................... 1,002,000 1,232,000
373.000
397.000
596.000
5*6,000
223.000
149.000
Ireland............................
589.000
770.000
743,000
308.000
Wales..............................
462.000
154.000
United Kingdom. 9,225,000 11,300,000 15,350,000 14,400,000 6,125,000 3,100,000
N ote.—The normal division of the contributions is varied in respect of low-wage earners, the em­
ployers paying more and the insured persons less, with, in some cases, a State grant ofld. (2 cents, par) a
week, in the absence of information as to the number of persons falling within this category, which in
any event must in present circumstances be very small, no account has been taken of this provision in
estimating the respective totals of contributions payable.
For the purpose of this table the number of contributors is taken as 350,000 fewer than the number of
insured persons, this difference representing persons who, having left insurable employment, remain en­
titled to benefits for the ensuing 12 months. Women who have left employment on marriage constitute
a large proportion of this number.
In view of the very small number of voluntary contributors it has been assumed in the preparation of
this table that all insured persons are employed contributors.

The increase in the amounts which Parliament will provide are
contained in the following statement:

ESTIMATE OF GRANTS FROM NATIONAL TREASURY, 1920 (EXCLUSIVE OF SPECIAL
GRANTS TO MEDICAL SERVICES).
[Source: Ministry of Health. National health insurance bill, 1920. Report by the Government actuary,
upon the financial provisions of the bill. London, 1920. Cmd. 612. Page 10. £ at par= $4.8665.1'
Country.
England...................................................................
Scotland...................................................................
Ireland........................................’............................
Wales........................................................................
United Kingdom..........................................
Supplementary grants:
Women’s equalization fund...........................
Central fund.....................................................
Total ........................................................
England...................................................................
Scotland.......................................................... \ . . . .
Ireland.....................................................................
Wales........................................................................
United Kingdom..........................................
Supplementary grants:
Women's equalization fund..........................
Central fund.................................................
Total..............................................................

104936°—23—Bull. 33,3----- 6



At rates of benefit prior to July 5,1920.
Approved societies.
Deposit
Total.
Men.
Women. contributors.
£2,523,000 £1,201,000
£51,000 £3,775,000
346.000
154,000
6,000
506.000
147.000
79.000
2,000
228.000
190.000
39.000
2,000
231,000
3,206,000
1,473,000
61,000
4,740,000
280,000
150,000
5,170.000
At rates of benefit under act of May 20, 1920.
£3,549,000 £1,509,000
£66,000 £5,124,000
457.000
195.000
8,000
690.000
206.000
100.000
3.000
309.000
267,000
49,000
3.000
319.000
4,509,000
1,853,000
80,000
6,442,000
350.000
150.000
6,942,000

?8

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN,

ESTIMATE OF GRANTS FROM NATIONAL TREASURY, 1920 (EXCLUSIVE OF SPECIAL
GRANTS TO MEDICAL SERVICES)—Concluded.
Increase in expenditure after July 5,1920, due to
act of May 20,1920.
Country.

Approved societies.
Men.

England.
Scotland.
Ireland...
Wales___
United Kingdom...............
Supplementary grants:
Women's equalization fund.
Central fund...........................
Total..

Women.

Deposit
contributors.

' Total.

£1,026,000
141,000
59.000
77.000
1,303,000

£308,000
41.000
21.000
10,000
380,000
70,000

£15,000
2,000
1,000
1,000
19,000

£1,349,000
184,000
81,000
88,000
1,702,000
70,000

1,303,000

450,000

19,000

1,772,000

The amounts given in the first table on page 77 show that the income
from contributions will be increased from £20,525,000 ($99,884,912.50,
par) to £29,750,000 ($144,778,375, par), or 45 per cent; the income from
Parliament (excepting certain special grants) will be increased from
£4,740,000 ($23,067,210, par) to £6,442,000 ($31,349,930, par), or
36 per cent.
NATIONAL HEALTH INSURANCE FUND.

It will be recalled that the receipts of the insurance,system are
placed in an account called the national health insurance fund, on
which the societies draw to pay benefits and administration expenses.
In the reports of the insurance system, the stateriients of the receipts
and expenses of these funds—one for each of the four countries—are
given separately and with a number of variations in the four accounts.
The only consolidated statement available is that for the period end­
ing January 11,1914, given in the Abstract of Labor Statistics for 1915
(the latest published up to January 1, 1921). This statement is as
follows:
RECEIPTS AND PAYMENTS OF NATIONAL HEALTH INSURANCE FUND, JULY 15, 1912,
TO JANUARY 11, 1914.
[Source: Seventeenth Abstract of Labor Statistics of the United Kingdom. London, 1915. Gd. 7733.
Page 168. £ at par—$4.8665.1
Item.

England.

Wales.

United
Scotland. Ireland. Kingdom.

From sale of health insurance stamps:
At post offices......................................... £19,783,000 £1,080,000 £2,847,934 £983,000 £24,693,934
13,096
225
43,655
At board of trade labor exchanges. ..
134,610
191,586
1,072
9,087
78,798
88,957
To army council.........................w.........
.
65,888
To army (India)............ ........................
65 888
115,096
2,476
855
To other Government departments
118,427
To employer depositors, quarterly and
349,411
140,066
53,993 2,371,195
1,827,725
To employers* sales of high value
3,868
3,868
stamps...................................................
To sundry persons by insurance com­
1,852
142
202
223
2,419
missioners..............................................
Admiralty contributions on behalf of
2,762
100,000
6,336
108,098
sailors and marines.....................................
14,682
14,682
Mercantile marine exempt persons..............
293,852
651,149 284,472 5,765.250
Exchequer grants........................................... ' 4,535,777
323
1,002
55
449
175
Other receipts.................................................
Total...................................................... 26,661,619 1,741,973 3,688,084 1,333,630 33,425,306




79

OPERATIONS OF THE SYSTEM.

RECEIPTS AND PAYMENTS OF NATIONAL HEALTH INSURANCE FUND, JULY 15,1912,
TO JANUARY 11,1914,-Concluded.
England.

Item.

Wales.

United
Scotland. Ireland. Kingdom.

PAYM ENTS.

Issues to;
Approved societies for sickness and
maternity benefits and for adminis­
tration expenses (less refunds)........... 8,774,909
642,460
870,519
Approved societies for investment.......
23,660
Insurance committees for sanatorium
and medical benefits and for admin­
istration expenses................................. 4,623,287
286,350
Deposit contributors for sickness and
maternity benefits (less refunds).......
15,727
983
Navy and army insurance fund for
sickness and maternity benefits (less
refund)...................................................
2,587
Employer depositors, quarterly and
weekly stamping, deposits repaid............
15,518
977
Refunds on account of health insurance
12,852
574
stamps returned to commissioners...........
For purchase of investments on behalf of
34,856
approved societies.......................................
585
10,512
171
Other payments..............................................
Balance in hands of national debt com­
missioners:
43,443
For investment account......................... 1,642,499
697,527
For temporary investment.................... 10,457,501
200,872
45,243
Balance at bank.............................................
Total....................................................... 26,661,619 1,741,973

1,230,000
8,069

632,707 11,280,476
902,248

608,473
1,306

36,078
389

5,554,188
18,405

506
...................
...................
2,766

43
1,368

2,567
17,044
14,794
35,441
35,151

2i,702

1,685,942
1,835,000 637,500 13,627,528 ,
251,522
11,564
3,843
3,688,084 1,333,630 33,425,306

1 Including £107 cash on hand.

The total receipts of the first period of actual operation (benefits
were payable only after January, 1913) were £33,425,306 ($162,664,252, par), of which £24,693,934 ($120,173,030, par) came from con­
tributions (stamps sold), while the parliamentary grant was £5,765,250 ($28,056,589, par).
The disablement benefit was not payable during this period, so that
the only pecuniary benefits included in the expenditures were sick­
ness and maternity benefits, on which £11,280,476 ($54,896,436, par)
were spent, including administration. The medical and sanatorium
benefits required £5,554,188 ($27,029,456, par), including adminis­
tration costs. The balance/for investment was larger in this period
than later because the full demands for benefits had not been felt.
The following summary gives the totals for the period 1912 to 1916
for England alone:
SUMMARY OF RECEIPTS AND EXPENDITURES OF THE NATIONAL HEALTH
INSURANCE FUND OF ENGLAND, 1912 TO 1916.
[Source; National Health Insurance Joint Committee. Report for 1913-14 on the administration
of national health insurance. Cd. 7496. Page 503. National health insurance fund accounts for
period Jan. 12 to Dec. 31, 1914. House of Commons Paper 38 of 1917, page 2. National Health In­
surance Joint Committee. Report on the administration of national health insurance during the years
1914-1917. Cd. 8890. Page 256. £ at par=$4.8665; shilling= 24.3 cents; penny=2.03 cents.]
Period.

Receipts.

July 15,1912, to Jan. 11,1914..................................................
Jan. 12 to Dec. 31,1914............................................................
1915.............................................................................................
1916.............................................................................................

26,661,618 15 7
18,305,962 11 U |
20,438,129 7 3|
19,016,790 0 6|
-----------------:------- ---




£

Expenditures.

s.

d.

.

£
14,360,746
18,071,611
20,159,712
18,881,840

s.

11
16
4
19

d.

5
2
10
1|

80

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

The years 1915 and 1916 were affected by war conditions to such an
extent that the operations here stated can not be considered normal.
The first annual report of the Ministry of Health, Part IV, national
health insurance (Cmd. 913), presents an abstract statement of the
national health insurance fund of England for the three years 1917 to
1919. The receipts and payments of the English fund are given as
typical of the operation of the system, especially as the great majority
of the insured persons reside in England. To this statement have
been added the figures for the year 1920, taken from the second annual
report of the Ministry of Health (Cmd. 1446). The two statements
are as follows:
ABSTRACT OF CASH RECEIPTS OF THE NATIONAL HEALTH INSURANCE FUND OF
ENGLAND FOR THE YEARS 1917, 1918, 1919, AND 1920.
[Source: First annual report of the Ministry of Health, 1919-20. Part IV. Administration of national
health insurance (1917 to March 31,1920). Page 78. Second annual report of the Ministry of Health,
1920-21. Cmd. 1446. Page 208. £ at par = $4.8665.]
Item.
Balance brought forward from previous year..................
NFrbm sale of health insurance stamps:
At post offices............ ^..................................................
At Ministry of Labor employment exchanges..........
To other Government departments...........................
To employer depositors—Half-yearly and weekly
stamping......................................................................
To employers—Bulk sales............................................
To sundry persons by insurance commissioners.......
Postmaster General for postage stamps affixed to health
insurance cards.................................................................
Ministry of Labor for unemployment stamps affixed to
Contributions on behalf of seamen, marines, soldiers,
and airmen....... ..............................................................
Mercantile marine exempt persons, etc.........................
Exchequer grants.................................................................
Carriage ofcontribution cards to insurance commission,
refunded by exchequer... r.............. . .............................
Ministry of Pensions: Grants toward cost of benefits of
invalided seamen, marines, soldiers, and airmen.........
Ministry of Labor: Contributions under out-of-work
donation scheme...............................................................
Interest on investments in securities selected by socie­
ties, held by co m m i s s io n e r s on behalf of societies (in­
cluding income tax refunded).........................................
Capital sums paid by late entrants into insurance.........
Sums recovered from employers for credit of societies in
ersection 70 of nationalinsuranceact,
Other Government departments, etc., for sanatorium
benefit provided to men in His Majesty’s forces prior
to discharge.........................................................................
Other Government departments, for refunds of benefits
paid as advances to discharged seamen^ marines, and
soldiers under section 1 (2) of national insurance act,
1915_______________________________
Other Government departments, for medical treatment
miscellaneous receipts___
For sale of investments on behalf of societies for reinvest­
ment...................................................................................
Transfer from national health insurance fund (Ireland)..
National debt commissioners, withdrawal from tempor­
ary investments.................................................................
Total..




1917

1918

1919

1920

£134,949 £422,426 £762,486 £361,110
11,985,418 11,947,375 12,407,780 17,402,721
41,796
34,706
37,176
38,604
94,664
113,048
107,937
107,713
926,351
945,568
927,648 1,276,080
8,066
592
7,057
4,431
3,636 .........6*i93
5,929
521
798
2,176
416
621
212
382
659
2,004,604 2,277,331 1,047,313
309,717
14,646
18,721
16,317
16,370
4,054,698 5,120,346 5,967,943 6,957,592
127
158
322,411
207.000
175,000
602.000
70,172
2,190

126,051
267

234,121

305,376

20

32
5,332

2,330

1,941

524

3,988

8,238
622
158
7,434

615
26
285
4,789

331
30
472

168
2,256
12,907

100

350,000
19,392,881 21,337,753 22,680,639 26,959,166

81

OPERATIONS OF THE SYSTEM.

ABSTRACT OF CASH PAYMENTS OF THE NATIONAL HEALTH INSURANCE FUND OF
ENGLAND FOR THE YEARS 1917,1918, 1919, AND 1920.
[Source: First annual report of the Ministry of Health, 1919-20. Part IV. Administration of national
health insurance (1917 xo March 31, 1920). Page 79. Second annual report of the Ministry of Health,
1920-21. Cmd. 1446. Page 209. £ at par = $4.8665.]
Item.

1917

Societies for benefits and expenses of administration
(including postal drafts paid and charges thereon)___ £6,750,320
Insurance committees for medical and sanatorium bene­
fits and expenses of administration................................ 4,721,460
War bonus allowances to medical practitioners...............
Deposit contribu ors, for benefits, etc...............................
24,461
Navy and army insurance fund, for benefits....................
35,270
Sanatorium benefits for discharged seamen, marines,
soldiers, and airmen (suspense account)............ I..........
2,675
Refund of sanatorium benefits paid by other Govern­
ment departments..................................................;..........
368
Refund of maternity benefits paid by other Goverrjment
22,616
departments
Special grants toward cost of medical attendance of aged
and disabled members of friendly societies...... J. . . . . . . . 8,038
Stationery office charges for printing on behalf of socie­
84
ties and insurance committees........................................
Refunds on account of health insurance stamps returned
2,636
to commissioners................................................................
Refunds of contributions paid in error..............................
68
Exchequer in respect of expenses of administration of
navy and army insurance fund, exempt persons fund,
and approved societies (officers) guaranty fund (Eng­
11,413
land)....................................................................................
Board of education, for amounts payable under section
52 of national insurance act, 1911....................................
649
Ministry of Labor, health insurance stamps affixed to
unemployment insurance books.....................................
1,371
Inland revenue, health insurance stamps affixed to in­
36
come tax cards...................................................................
Contributions to approved societies (officers) guaranty
11,589
fund (joint committee).....................................................
Societies for losses by defalcations made good out of
346
124
Miscellaneous payments.
Societies for investment:
Issues to societies........................................................... 2,358,647
Issues to societies on behalf of national health insur­
14,287
ance funds, other countries.......................................
Purchases on benalf of societies of securities selected by
societies............................................................................... 1,137,497
National debt commissioners for temporary investment. 3,860,000
National debt commissioners for investment on behalf
of approved societies (officers) guaranty fund (Eng6,500
Payments to married women under section 22 (8) of
national insurance act, 1918..............................................
Payments to special fund constituted under section 27
of national insurance act, 1918.........................................
Transfers to national health insurance funds, other
countries..............................................................................
Balance at end of year......................................................... 422,426
Total............................................................................. 19,392,881

1918

1919

1920

£7,315,955 £8,035,254 £10,264,344
5,472,410 6,338,731 10,116,617
298,232
52,849
28,410
53,284
45,025
58,545
82,540
109,056
4,253
1,411
3,239
15,545
3,685
196
2,387
97

18,630
2,964
250
3,701
69

9,807
2,634
1,013
7,064
107

31,687
18,501
1,322
684
966
560
73
97
6,102
6,022
114
107
3
8
4,362,969 5,314,279

64,669

1,447,216 2,134,310
1,840,000

473
111

6,788
6

116
3,048,465
1,799
1,068,979
850,000

2,500

4,500
20,290
125,500
97,154
762,486
361,110
936,188
21,337,753 22,680,639 26,559,166

MINISTRY OF HEALTH.

The appropriations for the health insurance system will in the
future be expended principally by the Ministry of Health for England
and Wales, the Scottish JBoard of Health, and the Irish insurance*
commissioners. The figures for the Irish body are given in a form
which does not correspond to those of the other bodies, and as the
number of insured persons is not large the appropriations are not
given here, to avoid complicating the statement. For the fiscal year
ending March 31, 1921, the following amounts were appropriated to
be disbursed by the ministry and the Scottish board for health
insurance purposes.



8 2

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN,

APPROPRIATIONS FOR NATIONAL HEALTH INSURANCE TO THE MINISTRY OF
HEALTH AND TO THE SCOTTISH BOARD OF HEALTH FOR THE YEAR ENDING
MAR. 31,1921.
[Source: Estimates for civil services for the year ending March 31,1921. London, 1920. House of Com­
mons Paper 2-VII of 1920. Pages 6, 7, and 20. £ at par=$4.8665.]
Scottish
Contributions, benefits, etc., under the national insurance (health) act, Ministry of Health. Board of
1911 to 1919.
England. Wales. Health.
Statutory contributions:
£400
£300
Weekly contributions................................................................................
£1,000
Medical and sanatorium-benefits (grants in aid)................................... 1,208,000 72.000 162,500
Sickness, disablement, and maternity benefits (grants in aid)........... 2.137.000 157,900 294.000
Expenses of administration, societies,and committees (grants in aid) 527.000 32,200
71,300
Special grants:
Medical benefit (grants in aid)................................................................. 4.835.000 314,000 712.000
19,000
Administration of medical benefit, etc. (grants in aid)........................ 184,800 11,500
7,100
Medical referee—consultants, etc.............................................................. 155.000 10.000
5.000
45,000
Sanatorium benefit.....................................................................................
7,500
1.000
600
Expenses of members of insurance committees...'..............................
4,000

The above statement does not include the office of the minister of
health nor the office of the Scottish secretary, which acts as the
central authority over the insurance departments as well as over the
other divisions of these two bodies. A relatively small amount for
theprinting, etc., of insurance stamps is also not included.
The items under “statutory contributions7’ are the two-ninths of
expenditure for benefits, administration, etc., required by the law.
Under the “special grants,77 the payments for medical benefit, includ­
ing doctors7fees, make up the principal amount.
S T A F F O F IN S U R A N C E D E P A R T M E N T .

The number of persons on the staff of the insurance department of
the ministry and the scale of salaries provided shows the organization
of a staff to supervise the administration of the system, but it does
not include the staff of the immediate office of the minister.
ORGANIZATION OF STAFF OF INSURANCE DEPARTMENT, MINISTRY OF HEALTH,
1920-21.
[Source: Estimates for civil services for the year ending Mar. 31,1921, London, 1920. House of Commons
Papers 2-VII of 1920. Page 10. £ at par=$4.8665.]
Occupation.

1920-21.
Minimum Annual Maxi­
mum Number Amount
salary. increase. salary.
on staff. spent for
salaries.

Controller........................................................................... £1,200
Deputy controller............................................................. 1,000
850
Assistant secretary...........................................................
850
Heads of branches............................................................
Superintending clerks......................................................
550
First-class clerks...............................................................
350
Second-class clerks............................................................
100
2600
Superintendent of index clearance.............. ................
300
Staff clerk..........................................................................
Chiefinspector................................................................... 2 1,000
400
’Chief inspector (woman).................................................
550
Divisional inspectors........................................................
2 100
Allowance to one for acting as deputy chief inspector.
350
Inspectors....................................... ..................................
Inspectors (woman).........................................................
300
Assistant inspectors.................................................. ......
100
100
Assistant inspectors (woman)........................................
Health insurance officers................!...............................
80
Health insurance officers (woman)................................
80

£50
50
50
25
20
15
0)
15
20
20
15
15
C2 10
1)
(3)
(«>

£1,500
1,200
1,000
1,000
700
500
350
2600
400
2 1,000
550
700
2 100
500
400
350
300
200
200

1
1
1
3
15
32
67
1
1
1
1
10
41
10
87
41
93
10

£1,388
1,038
1,000
2,594
8,635
12,648
9,067
600
308
1,000
531
6,623
100
18,082
3,990
16,054
6,757
14,657
1,454

1Increase of £20 at end of first two years’ service, then £10 per year up to £200, and then £15 per year
up to maximum.
2Flat amount.
* £ 5 per year up to £110 then £ 7 10s. up to £150, and then £10 up to maximum.




83

OPERATIONS OF TH E SYSTEM.

Under the civil-service system a position is allotted a basic salary,
which is increased by certain increments for periods of service.
The office is a large one, as there is a mass of detail to be handled.
N A T IO N A L H E A L T H IN S U R A N C E JO IN T C O M M IT T E E .

The scope of the work of the National Health Insurance Joint
Committee has been changed in many respects by the ministry of
health act of 1919 and by the new regulations issued under that
act. The appropriations for this committee since 1912 have been
as follows:
APPROPRIATIONS FOR THE NATIONAL HEALTH INSURANCE JOINT COMMITTEE,
FOR FISCAL YEARS ENDING 1913 TO 1921.
[Source: Estimates for civil services, 1914-1921.]
Object of appropriation.
Salaries and allowances..................
Special inquiries and services.......
Traveling and incidental expenses
Insurance stamps, benefits, etc...
Special drug fund (Great Britain)
Mileage (Great Britain, excluding
parts of Scotland),.......................
Administration of medical benefit,
etc..................................................
Medical research fund.....................
Expenses of insurance committee.
Arrears of contributions.................
Sickness benefit (women)..............
Medicalreference consultants, etc.
(Great Britain)............................
Supplementary medical service
(Great Britain).............................
Nursing grants................................
Sanatorium benefit.........................
Insurance committee (United
K in gdom )
__ _
Medical attendance, etc., of aged
and disabled members...........
Central fund.....................................
Total.......................................

1912-13 1913-14 1914-15 1915-16 1916-17 1917-18 1913-19 1919-20 1920-21
£

£

24,020 14,127
2.500 500
2,550 1,250
8.500 6,000
30.000
50.000
82,700

£

£

16,964 15,575
1,250 750
750 1,000
5,000 5,600
30.000 30.000
54.000 13.500
116,000 40,350
56,500 56.500
30.000 30.000
80.000 100,000
500.000 150,000
50.000 50.000
50.000 25.000
100.000 50.000
100,000 50.000

£

13,059
750
1,000
5,600
100
37.000
59.000
50,500
6,500
100
100

£

£.

£

£

12,846 12,998 1,750 2,280
750
750
750
300
50
750
5,900 5,900
55.000 74.000
95.000 94.000
50.000 54,600
4,400 3,800
100
10.000 1225,000 1250,000 1250,000

35,000 35,000 75,000

22,650
28,000

150,000 150,000 150,000
37,570 207,227 1,218,964 618,275 208,709|269,746 696,798 402,050 402,330

1Women’s equalization fund.

The larger appropriations for 1914-15 were due first to a grant
of £500,000 ($2,433,250, par) for pregnancy benefit for the approved
societies, which was later turned over to the women’s equalization
fund, and second to a grant of £100,000 ($486,650, par) for provid­
ing, on a national scale, a system of visiting nurses in connection
with medical benefit. The latter appropriation was returned to
the treasury because war conditions made it impossible to secure
the nurses, and action on the project has been deferred. The total
appropriations for the two years 1919-1921 are slightly in excess of
£400,000 ($1,946,600, par) annually. Beginning with 1920-21,
many of the accounts will be carried under the appropriations for
the Ministry of Health, the Scottish Board of Healtn, and the Irish
Insurance Commissioners.




84

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN,

RECEIPTS AND EXPENDITURES OF APPROVED SOCIETIES.

The operations of the approved societies as regards their receipts
and expenditures down to the end of the year 1916 have been as
follows:
RECEIPTS AND PAYMENTS OF APPROVED SOCIETIES, JULY 15,1912, TO DECEMBER 31,
1916, UNDER SECTION 54 (1) * OF THE NATIONAL INSURANCE ACT, 1911.
[Source: National health insurance fund accounts. Appendix. Approved societies and insurance com­
mittees18receipts and payments: July 15, 1912, to Dec. 31, 1914. London, 1919. Cmd. 212. Page 2,
7
*
1915 and 1916. Cmd. 691. Page 2. As each item is given to the nearest pound, the totals do not exactly
balance. £ at par=S4.8665.)
JULY 15,1912, TO JANUARY 11,1914.
Item.

Friendly Friendly Industrial
societies societies
and
with
without collecting
branches. branches. societies.

Trade Employ­
ers7
unions. funds. Total.

RECEIPTS.

From national health insurance
fund:
England.................................... £2,292,065 £1,851,885 £3,593,654 £956,606 £80,699 £8,774,909
Scotland....................................
322
322
3,412
Other cash receipts.........................
823 - 8,466
962
13,702
39
212,188
Balance owing to societies.............
20,358
14,836
84,590
2,852
334,825
Total...................................... 2,315,834 2,065,219 3,616,956 1,042,158 83,590 9,123,758
PAYMENTS.

Benefits (net):
809,242
* Sickness, men........................... 913,580
Sickness, women...................... 222,008
287.366
Maternity, men....................... 231,386
233.367
3,822
4,213
Maternity, women........... .
4,531
Medical.....................................
S a n a t o r i u m .........................................
924
290
4,360
Other charges to benefit fund.
Total benefits....................... 1,371,087 1,344,003
Administration (net)..................... 8571,198
600,550
120,665
Balances in hands of societies....... 373,550
Total...................................... 2,315,834 2,065,219

1,058,636
1,067,138
347,517
21,265

472,685
120,495
133,304
1,262

1,053
954
2,495,609
728,701
, 852,324
262,241
269,024
51,217
3,616,956 1,042,158

37,030 3,291,174
10,512 1,707,520
12,020
957,594
93
*30,655
4,531
924
44
6,702
59,701 5,999,101'
19,694 2,306,007
4,194
818,650
83,590 9,123,758

JANUARY 12,1914, TO DECEMBER 31,1914.
RECEIPTS.

From national health insurance
fund:
England.................................... £1,863,092 £1,826,049 £3,562,346
26
Scotland....................................
6
Wales.........................................
7,870
3,819
23,156
Other cash receipts.........................
269,024
Balances Jan. 11,1914.................... 372,828
121,387
13,066
24,890
187,551
Balances owing to societies...........
Total...................................... 2,264,655 2,142,864 3,867,591

£957,142 £72,896 £8,281,524
26
6
202
37,142
2,095
4,194
818,650
51,217
65,109
294,454
3,838
1,075,562 81,131 9,431,802

1 Act of 1911, section 54.—(1) All sums received in respect of contributions under this part of this act
and all sums paid out of moneys provided by Parliament under this part of this act in respect of the benefits
thereunder and the expenses* of administration of such benefits shall be paid into a fund, to be called the
national health insurance fund, under the control and management of the insurance commissioner and
the sums required to meet expenditure properly incurred by approved societies and insurance committees
for the purposes of the benefits administered by them and the administration of such benefits shall be paid
out of that fund.
8This amount includes payments charged in the administration accounts of branches in respect of levies
for the purpose of meeting the administration expenses of head office and districts. The sum of £7,835
10s. 8d. remained in the hands of head office and districts not expended Jan. 11,1914.




85

OPERATIONS OF THE SYSTEM,

RECEIPTS AND PAYMENTS OF APPROVED SOCIETIES, ETC.—Continued.
JANUARY 12, 1914, TO DECEMBER 31, 1914—Concluded.
Item.

Friendly Friendly Industrial
and
societies societies
with
without collecting
branches. branches. societies.

Trade Employ­
ers'
unions. funds. Total.

PAYMENTS.

Benefits (net):
Sickness, men...........................
Sickness, women.....................
Disablement, men...................
Disablement, women..............
Maternity, men...................
Maternity, women...................
Medical.....................................
Sanatorium..............................
Other charges to benefit fund.......
Total benefits..................... <
.
A.dministration (net).....................
National health insurance
fund (Scotland)....................
Balances Jan. 11,1914.............
Balances in hands of societies.
Total......................................

£974,419
236,103
43,090
7,317
200,700
16,927
1,348
1,479,904
3 386,581
25
20,344
377,800
2,264,655

£865,546
282,671
29,294
8,623
230,529
19,188
11,107
2,641
7,989
1,457,586
395,977
19
212,202
77,079
2,142,864

£1,270,283
1,044,012
26,270
17,175
355,076
123,461
6,936
2,843,212
626,829
14,836
382,714
3,867,591

£513,908 £39,640 £3,663,796
8,992 1,666,388
94,611
1,431
14,749
114,835
35,281
1,829
337
930,423
132,704 11,413
172,894
12,678
640
11,107
2,641
572
185
17,030
771,052 62,639 6,614,393
179,309 12,132 1,600,829
817
861
84,590
2,852
334,825
39,793
3,508
880,894
1,075,562 81,131 9,431,802

3 This amount includes payments charged in the administration accounts of branches in respect of levies
for the purpose of meeting the administration expenses of head office and districts. The sum of £10,920
7s. 9d. remained in the hands of head office and districts not expended Dec. 31,1914.*
YEAR ENDING DECEMBER 31,1915.
RECEIPTS.

From national health insurance
fund:
England.................................... £1,796,898 £1,879,632 £2,989,495
41
2
1
Scotland....................................
17
22
Wales.........................................
10,804
19,934
35,343
Other cash receipts.........................
382,714
77,101
Balances Dec. 31.1914.................... 377,778
Balances owing to societies Dec.
16,340
83,384
7,201
31,1915..........................................
Total...................................... 2,201,877 2,060,076 3,414,754

£879,158 £76,162 £7,621,345
43
68
29
3,431
528
70,040
880,894
39,793
3,508
51,980
2,636
161,541
974,391 82,834 8,733,931

PAYMENTS.

Benefits (net):
716,133
Sickness, men......... ................. 848,430
875,829
245,332
Sickness, women..................... 205,669
802,410
152,388
135,621
115,370
Disablement, men...................
35,372
Disablement, women..............
111,531
43,513
216,137
329,500
Maternity, men....................... 193,442
16,091«
18,134
Maternity, women..................
109,483
9,792
Medical.....................................
3,130
Sanatorium..............................
2,612
9,829
10,876
Other charges to benefit fund---1,454,008 1,377,370 2,375,251
Total benefits.......................
Administration (net).................... <405,572
413,125
786,813
National health insurance
fund:
6
Scotland.............................
Ireland................................
Wales..................................
3
24,872
Balances Dec. 31.1914....... ;..
187,567
i3,066
82,004
Balances in hands of societies. 317,425
239,623
Total...................................... 2,201,877 2,060,076 3,414,754

398,824
77,038
63,691
10,170
121,810
10,708
2,346
684,588
178,861

35,025 2,874,241
8,577 1,339,026
472,376
5,306
202,153
1,563
10,674
871,565
589
155,005
9,792
3,130
285
25,948
62,019 5,953,236
12,242 1,796,713

3,356
6
384
65,109
41,988
974,391

3,362
1
7
1
388
294,454
3,840
4,731
785,772
82,834 8,733,931

* This amount includes payments charged in the administration accounts of branches in respect of levies
for the purpose of meeting the administration expenses of head office and districts. The sum of £12,903
8s. lljd. remained in the hands of head office and districts not expended Dec. 31, 1915.




86

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN,

RECEIPTS AND PAYMENTS OF APPROVED SOCIETIES, ETC,—Concluded.
YEAR ENDING DECEMBER 31, 1916.
Friendly Friendly Industrial
societies societies
and
Trade Employ­
Item.
ers’
with
without collecting unions. funds. Total.
branches. branches. societies.
RECEIPTS.

From national health insurance
fund:
England.................................... £1,613,159 £1,614,898 £2,926,056
Scotland....................................
Ireland.......................................
Wales.........................................
2
Other cash receipts.........................
22,457
32,892
60,039
Balances Dec. 31,1915.................... 317,031
82,398
239,623
91,445
Balances owing to societies...........
2,264
15,660
Total....................................... 1,968,307 1,821,636 3,227,982
PAYMENTS.

£805,165 £65,053 £7,024,332
30
30
3
3
35
37
4,624
672
120,683
41,988
4,731
685,772
57,990
2,582
169,942
909,835 73,038 8,000,799

Benefits (net):
767,447
Sickness, men........................... 698,449
602,041
351,404 29,366 2,448,707
212,631
178,203
665,686
Sickness, women.....................
66,663
7,403 1,130,585
182,749
Disablement, men................... 183,200
145,036
82,598
6,428
600,011
168,097
Disablement, women..............
62,061
15,269
48,900
1,981
296,309
308,211
Maternity, men.......................
186,439
208,456
117,573
9,699
830,379
Maternity, women..................
18,471
102,308
16,523
9,428
562
147,293
7,904
Medical.....................................
7,904
3,112
Sanatorium...............................
3,112
14,312
14,602
3,433
2,836
Other charges to benefit fund.......
414
35,596
Total benefits....................... 1,315,146 1,274,316 2,208,810
645,772 55,853 5,499,896
790,252
Administration (net)..................... 5389,579
403,476
175,704 12,447 1,771,457
National health insurance
fund—
Scotland.............................
16
16
3,703
Wales..................................
3,703
16,335
83,388
Balances Dec. 31,1915.............
7,201
51,980
2,636
161,541
221,719
56,736
Balances in hands of societies. 247,246
36,380
2,103
564,185
Total...................................... 1,968,307 1,821,636 3,227,982
909,835 73,038 8,000,799
5 This amount includes payments charged in the administration accounts of branches in respect of levies
for the purpose of meeting the administration expenses of head office and districts. The sum of £14,699
13s. 6£d. remained in the hands of head office ana districts not expended Dec. 31, 1916.

For the years 1917 to 1920 the annual reports of the Ministry of
Health (Cmd. 913 and 1446) present the figures in a slightly different
form, so no attempt has been made to combine them with the pre­
ceding table. The statement is as follows:
APPROXIMATE RECEIPTS AND PAYMENTS OF APPROVED SOCIETIES (ENGLAND)
1917, 1918, 1919, AND 1920.
[Source: First annual report of the Ministry of Health, 1919-20. Part IV. Administration of national
health insurance (1917 to Mar. 31, 1920). Page 77 Second annual report of the Ministry of Health,
1920-21. Cmd. 1446. Page 207. £ at par =$4.8665].

Item.
191J
1918
1919
1920
RECEIPTS.
From national health insurance fund (England)__ £6,750,320 £7,315,955 £8,035,254 £10,264,000
Other receipts.................................................................
292,728
459,631
683,026
394,243
438,053
Balances (net) brought forward Jan. 1.......................
449,272
617,000
Total...................................................................... 7,437,291 8,213,639 9,167,552 11,749,000
PAYMENTS.
Benefits (net):
Sickness, men.......................................................... 2,277,815 2,610,150 2,806,350
3.356.000
Sickness, women..................................................... 1,119,040 1,388,080 1,264,500
1.598.000
Sickness, women, Class K.....................................
780
,5,960
15.000
Disablement, men..................................................
644,560
665,625
699,640
994.500
Disablement, women.............................................
340,585
377,070
411,560
596.500
Maternity, men.......................................................
680,400
637,550
710,100
1.159.000
Maternity, women.................................................
140,285
150,975
161,940
230.000
Maternity, women, Class K ..................................
2,460
49,450
151.000
Other benefit fund charges, Including, married
45,000
women’s credits.......................... ...............................
87,175
331,040
61.000
Total benefits....................................................... 5,247,685 5,919,865 6,440,540
8,161,000
Administration (net)..................................................... 1,751,553 1,844,502 2,110,286
2,633,000
Balance (net), Dec. 31...................................................
438,053
449,272
616,726
955,000
Total...................................................................... 7,4?7,291 8,213,639 9,167,552 11,749,000




868,000

87

OPERATIONS OF THE SYSTEM,
R E C E IP T S A N D E X P E N D IT U R E S O F IN S U R A N C E C O M M IT T E E S .

The following table shows the financial operations of the insurance
committees in their administration of the medical and sanatorium
benefits down to the end of the year 1916.
RECEIPTS AND PAYMENTS OF INSURANCE COMMITTEES. 1912 TO 1916, UNDER
SECTION 54 (1) i OF THE NATIONAL INSURANCE ACT, 1911.
[Source: National health insurance fund accounts. Appendix. Approved societies and insurance com­
mittees’ receipts and payments, July 15,1912, to December, 31,1916. London, 1919. Cmd. 212. Page 6.
1915-196, Cmd. 691. Page 6. As each item is given to the nearest pound, the totals do not exactly bal­
ance. £ at par=$4.8665.J
Item.

From July From Jan.
15,1912, to 12,1914, to Year 1915. Year 1916.
Jan. 11,1914. Dec. 31,1914.

RECEIPTS.

From commissioners for medical and sanatorium
■ benefits and expenses of administration.................... £4,622,343 £5,377,462 £4,501,524 £4,975,530
Other receipts:
438
510
. For benefits of deposit contributors......................
288
677
15,657
18,101
From approved societies.........................................
7,501
18,431
7,969
6,619
6,494
6,721
Interest.......................................................................
54
Sundries.....................................................................
7
42
5
661,980
444,061
332,511
Balances brought forward..............................................
Total....................................................................... 4,636,631 6,063,518 4,970,869 5,333,911
PAYMENTS.

Medical benefit (including temporary residents) 1. . .
Mileage..............................................................................
Sanatorium benefit2.......................................................
Administration3..............................................................
Other payments:
Benefits of deposit contributors.............................
Sundries.....................................................................
Balances in hands of insurance committees................
Total.......................................................................

3,371,800
1,928
339,146
260,855
287
635
661,980
4,636,631

4,855,206
19,583
440,136
301,956
429
2,142
444,061
6,063,513

3,971,809
18,072
403,300
241,948
490
2,740
332,511
4,970,869

4,354,037
19,845
330,078
235,068
703
2,335
301,846
5,333,911

1 See note (a) to table on page 75.
2 The payments shown for medical benefit include payments to practitioners in respect of the domiciliary
treatment of persons suffering from tuberculosis. The sums payable under this heading in respect to the
above periods were as follows: Period from July 15,1912, to Jan. 11,1914, £263,207 7s. 3d.; period from Jan.
12,1914, to Dec. 31,1914, £249,278 15s. 7d.; year 1915, £237,09019s. 5d.; year 1916 £224,927 Us. 7d.
a The payments shown for administration include the proportion of the expenses of administration
attributable to sanatorium benefit.

For the three-year period 1917 to 1920, the receipts and payments
are given in the Ministry of Health reports as follows:

APPROXIMATE RECEIPTS AND PAYMENTS OF INSURANCE COMMITTEES (ENGLAND)
1917, 1918,1919, AND 1920.
[Source: First annual report of the Ministry of Health, 1919-20. Part IV. Administration of national
health insurance (1917 to March 31, 1920.) Page 77. Second annual report of the Ministry of Health,
1920-21. Cmd. 1446. Page 207. £ at par=$4.8o65.1
Item.

1917

1918

1919

1920

RECEIPTS.

From national health insurance fund (England)— £4,721,460 £5,472,410 £6,338,731 £10,117,000
30,590
22,000
Other receipts.................................................................
39,116
27,965
520,000
391,846
404,643
400,937
Balances brought forward Jan. 1................................
Total...................................................................... 5,141,271 5,912,463 6,773,964 10,659,000
PAYMENTS.

Medical benefit................................1............................
Mileage..................................................................... ......
Sanatorium benefit........................................................
Administration..............................................................
Other payments.............................................................
War allowances to doctors...........................................
Balances Dec. 31............................................................
Total.....................................................................




4,092,164
30,682
361,113
225,789
30,586
400,937
5,141,271

4,774,963
42,427
403,191
261,204
26,035
404,643
5,912,463

5,036,999
40,205
563,440
341,985
9,668
261,469
520,198
6,773,964

7.889.000
128,000
839.000
437.000
c 9,000
302.000
1.055.000
10,659,000

88

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

Throughout the period referred to in the preceding tables, the
amounts received and paid out have fluctuated only within narrow
limits. Attention should be called, however, to items under expendi­
ture of the National Health Insurance Joint Committee and the
Ministry of Health, where th.6 special grants provided for medical
service are listed.
STATISTICS OF SICKNESS.

The British insurance system had barely gotten a fair start when
the war made necessary a drastic reduction m expenditure of money
and of man power for social-welfare purposes. One of the subjects
which was immediately held in abeyance was the collection of all
statistical data. For this reason there is very little published infor­
mation as to sickness rates, death rates, etc., of the insured popula­
tion in connection with the insurance system.
The following tables are reproduced from the reports of the
chief medical officer of the Ministry of Health.
Causes of death.—The relative importance of the causes of death
among the English population as a whole during 1921 is shown in
the following table:
CAUSES OF DEATH IN ENGLAND AND WALES, 1921.
[Source: Annual report of the chief medical officer of the Ministry of Health for the year 1921. London,
1922. Page 13.]
Cause of death.
Measles............................................................................................................................
Whooping cough...........................................................................................................
Diphtheria.....................................................................................................................
Influenza.......................................................................................................... ..........
Tuberculosis of respiratory system............................................................................
Other forms of tuberculosis.........................................................................................
Cancer.............................................................................................................................
Diseases of nervous system and sense organs__'.....................................................
Disease of the heart................................ ....................................................................
Other diseases of circulatory system..........................................................................
Bronchitis................................................................... ..................................................
Pneumonia.....................................................................................................................
Other diseases of respiratory system..........................................................................
Diarrhea and enteritis........................ ........................................................................
Other diseases of digestive system.............................................................................
Diseases of genito-urinary system..............................................................................
Premature birth and diseases of early infancy.........................................................
Old age...........................................................................................................................
Violence (all forms)......................................................................................................
Other causes.................................................................................................................
Total............:.......................................................................................................

Proportion
Number of per 1,000
deaths deaths from
all causes.
*r
2,241
4,576
10
4,772
10
8,995
20
33,505
73
9,173
20
46,022
100
105
48,217
117
53,707
14,571
32
33,684
73
34,708
76
12
5,707
17,086
37
40
18,329
-17,862
39
26,442
58
27,406
60
16,501
36
35,125
77
458,629
1,000

The principal causes of death in 1921 were about the same as in the
preceding years. Diseases of the heart, diseases of the nervous sys­
tem, and cancer caused nearly one-third of the total deaths, while
pneumonia, bronchitis, and tuberculosis caused nearly one-fourth.
To show the nature of the sickness which causes the serious loss of
working power to the insured population, referred to elsewhere, the
chief medical officer prepared two statements of proportionate mor­
bidity in representative areas; the first statement, for 1916, included
about 6,000 cases, while the second, for 1921, included about 36,000
cases. The cases were taken from the records of representative insur­
ance practitioners in various cities. The data are as follows:



89

OPERATIONS OP THE SYSTEM.

PROPORTION OF CERTAIN DISEASES AMONG INSURED PERSONS IN REPRESENTA­
TIVE CITIES, 1916 AND 1921.
[Source: Annual report of the chief medical officer of the Ministry of Health for the year 1920, page 39;
for the year 1921, page 28.]
1916, both sexes.
Disease.

1921
Both sexes.

Males.

Females.

Pro
Pro
Pro
Pro
Num­ por­ Num­ por­ Num­ por­ Num­ por­
tion ber of tion ber of tion ber of tion
ber of per
per
per
per
cases. 1,000 cases. 1,000 cases. 1,000 cases. 1,000
cases.
cases.
cases.
cases.

Influenza................................................ 386 76.1 3,097 85.3
62 12.2
505 13.9
Tuberculosis, all forms.........................
520 14.3
Organic heart disease............................ 112 22.1
202 39.8 1,157 31.9
Anemia...................................................
Bronchitis, bronchial and nasal
catarrh, cold, etc................................ 920 181.3 7,739 213.0
Pneumonia and other diseases of
537 14.8
the respiratory system...................... 351 69.2
Diseases of digestive system................ 726 143.1 4,766 131.2
Diseases of genitourinary system—
144 28.4
912 25.1
Diseases of nervous system and
special senses....................................... 340 67.0 1,775 48.9
Skm diseases.......................................... 239 47.1 1,741 47.9
308 60.7 2,871 79.0
Injuries and accidents..........................
Abscess, boils, and other septic con­
249 49.1 2,503 68.9
ditions.................................................
Lumbago, rheumatism, etc................. 336 66.3 3,181 87.6
Debility, neuralgia, and headache... 285 56.0 1,999 55.0
66
1.8
Malignant disease1................................
Other diseases........................................ 414 81.6 2,956 81.4
Total............................................. 5,074 1,000.0 36,325 1,000.0

2,004
320
355
74
4,988
395
2,797
339
1,088
1,039
2,358
1,647
2,201
855
45
1,720
22,225

90.2
14.4
16.0
3.3
224.4
17.8
125.8
15.3
49.0
46.7
106.1
74.1
99.0
38.5
2.0
77.4
1,000.0

1,093
77.5
185
13.1
165
11.7
1,083
76.8
2,751 195.2
142
10.1
1,969 139.6
573
40.6
687
48.7
702
49.8
513
36.4
60.7
856
69.5
980
81.1
1,144
21
1.5
87.7
1,236
14,100 1,000.0

1 Not given separately for 1916.

From the table it will be noted that the serious diseases, such as
tuberculosis, malignant disease, and organic heart disease, are rela­
tively few in number, though they are conspicuous in the mortality
tables. Such diseases as bronchitis and disorders of the digestive
tract are prominent as causes of disability and prevent the insured
population from following their usual occupations, though these
diseases do not form so large a percentage as causes of death.
OPERATIONS OF TYPICAL INDIVIDUAL CARRIERS.
FRIENDLY SOCIETIES.

Review of the year 1919.—The attitude of the great friendly orders
to the insurance system is always of importance, as they are the car­
riers for the largest proportion of the insured persons. The follow­
ing comment on the experience of these societies in 1919 is repro­
duced from an insurance journal.6

The year 1919 has been one of reconstruction for British friendly societies. The
war brought heavy claims upon their funds, and the fall in membership resulting
from the deaths of many thousands of members on active service was intensified by
the reluctance to accept young men of military age, other than those who came from
the juvenile branches, because of the heavy liability involved. Many of the socie­
ties suspended the payment of sickness benefit to members on active service, retaining
them as members and paying the funeral claim in the event of death. The Man­
chester Unity of Odd Fellows gave its service members the option of paying their own'
6 The National Insurance Gazette, London, Saturday, Jan. 17,1920, p. 34.




90

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

contributions and receiving their full benefits or leaving the contributions unpaid and
receiving only death payments, in which event the members at home paid 50 per cent
of the contributions to provide the necessary reserves. A considerable percentage
of the service members elected to pay their own contributions, and in the result the
claims for sickness and disablement from wounds, though above the average, amounted
to less than the general expectation.
Most of the societies are considering various forms of memorials of members who
served in the Great War. Some have already their war memorials in existence. The
Manchester Unity of Odd Fellows, who received £438,357 [$2,133,264, par] on account
of contributions of members serving in the forces, has inaugurated an orphan fund
as a permanent war memorial. The voluntary gifts to this fund now exceed £6,800
[$33,092, par], and the annual income from levy reaches £3,500 [$17,033, par]. The
beneficiaries receive from birth to 5 years old 5s. [$1.22, par] per week; from 5 to 7, 6s.
[$1.46, par]; from 7 to 9, 7s. [$1.70, par]; from 9 to 11, 8s. [$1.95, par]; from 11 to 13,
10s. [$2.43, par], and from 13 to 16,12s. 6d. [$3.04, par] per week. The Ancient Order
of Foresters has also decided upon a fund for widows and orphans, and the Hearts of
Oak Benefit Society will establish a permanent memorial.
R e c o n s tr u c tio n s c h e m e s —The societies are finding it necessary to consider recon­
struction schemes to adapt their contributions and benefits to the changed circum­
stances produced by the war. The rise in wages and the cost of living are giving
renewed opportunities to the friendly societies, as many insured persons are now
realizing the need for additional insurance in time of sickness. This is encouraging the
societies to devise new and attractive benefit proposals. The Manchester Unity of
Odd Fellows has decided that all members joining the society * * * must sub­
scribe for an annuity benefit payable at 70 years of age, when the sickness benefit will
cease. The Ancient Order of Foresters has decided upon new tables for future mem­
bers, providing for the payment of sickness benefits up to 70, when contributions will
cease, with the option of contributingior an annuity benefit from 70 onward. It has
also decided to set up a contingency fund, which will be at the call of every court in
the order according to its need.
The aggregate membership of British friendly societies is about 7,000,000; the reserve
funds to meet future liabilities total £60,000,000 [$291,990,000, par]; the annual income
is about £8,000,000 [$38,932,000, par]; and the payments are about £6,000,000
[$29,199,000, par]. These figures show now great a work the voluntary friendly socie­
ties are doing, even against the competition of a compulsory insurance scheme, and
how considerable a part they still play in the social life of the workers.
The following are particulars of the principal societies:
The Manchester Unity of Odd Fellows holds pride of place and is the only friendly
society with a subscribing membership exceeding 1,000,000. The aggregate inde­
pendent membership is 1,058,155, and the State section has a membership of 971,668.
During the war period the deaths of members increased from 10,777 in 1913 to 20,529
in 1918. The funds of the society amount to £17,972,990 [$87,465,556, par]. The
annual income is £2,332,683 [$11,352,002, par], and payments £1,970,808 [$9,590,937,
par].
The Ancient Order of Foresters has an independent membership of 981,674 and a
State insured membership of 721,767. The reserve capital amounts to £11,098,754
[$54,012,086, par], and the order is looking forward to a period of prosperity under
peace conditions. The high court at Norwich in August last carried a complete recon­
struction of the tables of contributions and benefits, and with the operation of the
new contingencies fund there should result a considerable further strengthening of
the financial reserves.
The Hearts of Oak Benefit Society had an independent membership on November
30 of 379,116 and a State membership of 471,026. The admissions from Whitsuntide to
November 22 number 17,670. For the 11 months to November 30 the society admitted
22,686 voluntary members and 16,795 State-insured members. The income for the
11 months was £692,767 [$3,371,351], and the payments, £438,068 [$2,131,858, par].
The total capital on November 30 was £5,385,434 [$26,208,215, par]. The society had
8,909 members killed or died on active service and paid in respect of them £168,251
[$818,793, par].
The National Deposit Friendly Society, the jubilee of which was celebrated at
Nottingham in May, continues to make considerable progress. From January to
October 30 the society admitted 52,942 new members into the deposit section and
25,941 into the State-insured section. The membership at the end of 1918 was 456,231
and the funds £2,710,304 [$13,189,694, par.] The president has offered to give the




OPERATIONS OF THE SYSTEM.

91

society a freehold site of about 3 acres, near Skegness, and to contribute to the cost of
building a convalescent home as a jubilee war memorial, conditional on the members
generally and generously contributing to the memorial.
The Independent Order of Rechabites has a total membership of 799,476. This
order has the distinction of the largest juvenile membership, numbering 403,519.
It has also a State-insured membership of 427,882. The capital amounts to £3,464,369 [$16,859,352, par].
Statistics of other societies are: •
Ashton Unity of Shepherds: Independent members, 214,000; State insured, 189,
512; funds, £1,491,189 [$7,256,871, par].
Order of the Sons of Temperance: Independent members, 270,000; State insured,
142,890.
Rational Association: Members, 174,454; State insured 124,700; capital, £740,540
[$3,603,838, par].
Grand United Order of Odd Fellows: Members, 502,656 (of whom 370,036 are in
America); State insured, 95,072; funds, £2,107,498 [$10,256,139, par].
Order of Druids: Independent members, 108,700; State insured, 94,000; capital,
£282,521 [$1,374,888, par].
United Ancient Order of Druids: Independent members, 2*13,777; State insured,
69,057; funds, £1,470,302 [$7,155,225, par].
National Independent Order of Odd Fellows: Independent members, 120,525;
State insured, 80,000; funds, £597,000 [$2,905,301, par].
National Order of Free Gardeners: Independent members, 50,513; State insured,
67,268* funds, £273,938 [$1,333,119, par].
British Order of Free Gardeners: Independent members, 77,728; State insured,
67,268; capital, £441,712 [$2,149,591, par].—The Daily Telegraph, from its society
correspondent.

ESTABLISHMENT FUND.

One of the types of organization authorized to act as^ an approved
society is the establishment fund or employers’ provident fund. An
instance of this type is the following:7
S outh M etropolitan G a s Co m pa n y ’s E m plo yees ’ P ro vident S ociety .
EXTRACTS PROM REPORT OF THE COMMITTEE OP M ANAGEM ENT A ND ACCOUNTS FO R
THE YEAR E N D IN G DECEM BER 31, 1918.

The year which saw the suspension of hostilities in the Great War was probably
the most severe in the experience of approved societies since the national health
insurance scheme came into operation; and in this respect our own society formed no
exception.
Sickness was very heavy; and management, both in its financial and administra­
tive aspects, more exacting. The constantly changing status of members from civilian
to military—from military back again to civilian—was a growing source of complexity,
affecting in many ways the transaction of the ordinary State business of the society.
The insurance commission (now the Ministry of Health) did their best to simplify
matters; but it is not unfair to say that the arrangements made by the Government
were, perhaps unavoidably, inadequate. In these circumstances, the company
made good the shortcomings of the State; and the directors, to whom thanks are due,
will be gratified to know that our members deeply appreciate what is done on their
behalf to carry out with good will the purposes which the approved society was in­
tended to fulfill.
S ta te m e m b e rsh ip .—Membership of the society at the end of 1918 was 5,211 as
compared with 5,381 in December, 1917, a decrease of 170. This reduction was due
partly to the temporary and uncertain conditions of employment in the company
during the war, and partly to the unusually high death roll during the year under
report.
i

The National Insurance Gazette, London, Feb. 7,1920, p. 71.




92

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

S ta te b e n e fits .—It will be remembered that serving soldiers and sailors are not en­
titled to sickness or disablement benefit, but their wives retain the right to claim
maternity benefit. An analysis of the society’s experience gives the following
results:

Sickness benefit.
Year.

1915.................
1917.................
1918.................

Number
of claims
paid.
■ 1,614
1,619
2,093

Percent­
age of
total
civilian
member­
ship.

Disablement benefit.
Average
Average
cost per Claims Amount paid. cost per
member
member paid.
per
per week.
week.

Total cost.
£

9. d.

43.30 2,027 12 10
44.46 2,133 10 3
61.55 2,852 8 1

> d.

2.51
2.70
3.87

£

67
110
142

s. d.

306 17 10
390 7 6
494 2 6

d.

0.379
.494
.670

A return is also appended showing the annual sickness records of the society since
the year 1901, from which it appears that the average length of sickness in days per
member was 14.54 in 1918, as against 10.17 for 1917, an increase of 4.37 days. It will
be seen that the amount of sickness during 1918 was higher than in any previous
year. This result is not peculiar to our own society. It is attributable entirely to
the serious influenza epidemic which swept over the country toward the end of 1918.
with most deplorable consequences. Of the total sickness claims in our own society,
influenza alone accounted for as many as 40 per cent, as against 15 per cent in the
previous year, whilst the aggregate period of sickness produced amounted to 12,482
days in 1918, as against 3,379 in 1917; and the charge on the State funds alone was
£993 [$4,832.43, par], as compared with £256 [$1,245.82, par] in the preceding year.
Another matter which the committee view^ with some anxiety is the increase in
the number of cases of pulmonary tuberculosis. .As against 10 cases in 1917, there
were 18 in 1918. Of these, 6 were discharged soldiers, and it may be that war condi­
tions have accelerated the disease amongst those civilian members in whom its exist­
ence had not sooner been discovered.
S ic k n u r s in g a n d v is it i n g .—The more experience we have of the nursing services
the greater is our admiration of the way in which the ‘‘Ranyard” and 4‘Queen’s ”
nurses carry out their duties. No fewer than 156 visits were paid to our own members
during 1918. These visits occupy sometimes from two to three hours each, and have
been repeated as often as three times a day. Indeed, in very serious cases a skilled
nurse would remain with the patient the whole night through. Voluntary service
of this kind is beyond praise.
M a te r n ity b e n e fits .—The claims for maternity benefit fell to a remarkable extent
during the year under report, as the following figures will show:
Year.
1916............:......................

1917....................................
1918....................................

Claims
paid.
471
391
281

Total
amount.
£
706
586
421

s.

10
10
10

Average
cost per
member
per week.
d.

0.62
.50
.37

Members continue to avail themselves of the society’s midwifery scheme, with
' satisfactory results.
A d m in is tr a tio n e x p e n se s .—The total amount spent in administration for the year was
£61610s. 4d. [$3,000.28, par], which is equivalent to0.54d. [1.1 cent, par] per member
per week. This is a reduction of 0.19d. [.39 cent, par] on the figures for 1917, which
worked out at 0.73d. [1.48 cent, par] per member per week. There is thus a surplus
in the administration account of £75 Is. 3d. [$365.29, par]. But although this result
is satisfactory, it would not have been attained had not the company relieved the
society from the increased expenditure on account of war bonuses and allowances
paid to the staff at home and on active service.




93

OPERATIONS OF TH E SYSTEM.

INDUSTRIAL INSURANCE SOCIETY.

The industrial insurance companies are authorized to act as carriers
of the national system and they arrange this by creating a separate
organization for the purpose. One of the largest of the societies of
this type is the following:8
P r u d en tia l A ppro ved S ociety for M e n .
AN N U A L REPORT FOR 1919.

The committee of management have much pleasure in presenting their report and
statement of accounts for the year ending December 31, 1919.
During the year, 126,477 new members were admitted, of whom 107,305 joined the
society in England, 12,459 in Scotland, 3,127 in Wales, and 3,586 in Ireland.
The total active membership of the society, including those serving in the forces,
exceeds 1,600,000.
The sum of £569,415 10s. 7d. [$2,771,061, par] was paid during the year as sickness
benefit; £150,177 9s. 3d. [$730,839, par] as disablement benefit; and £149,172 5s. 5d.
[$725,947, par] as maternity benefit, making, together with subscriptions of £44 9s.
Id. [$216.34, par] to charitable institutions for the benefit of members, a grand total
of £868,809 14s. 4d. [$4,228,062, par] paid in benefits during the 53 weeks dealt with
in the year’s accounts, as compared with £758,389 4s. [$3,690,701, par] in 1918, a period
of 52 weeks.
The cost of sickness benefit for the year, after making full allowance for the members
serving in the navy or army, was only 71 per cent of that allowed for in the original
estimates of the actuarial advisers of the Government.
The sum of £1,132,223 7s. 9d. [$5,509,965, par] was invested by the trustees during
the year.
The total amount invested by the trustees to the end of the year was £3,507,437
12s. 2d. [$17,068,945, par], the average rate of interest earned on this sum during 1919
being £5 4s. 2d. per cent.
The amount invested in British Government securities is £3,111,630 5s. lid . [$15,142,749, par].
In addition to the investments by the trustees the sum of £780,432 [$3,797,972,
has been transferred to the credit of the society in the national health insurance
1 investment accounts, making a total of £2,564,119 [$12,478,285, par] now stand­
ing to our credit in those accounts. The rate of interest per annum received on this
sum is 4 per cent. #
The sums paid in benefits during the year 1919 by the four prudential approved
societies were as follows: Sickness benefit, £1,048,721 4s. lOd. [$5,103,602, par];
disablement benefit, £318,897 4s. 8d. [$1,551,913, par]; maternity benefit, £202,314
8s. 5d. [$984,563, par]; married women’s benefit, £118,088 15s. 7d. [$574,679, par];
subscriptions to hospitals, etc., £88 18s. 2d. [$433, par]; making a grand total of £1,688,110 11s. 8d. [$8,215,190, par] (for a period of 53 weeks), as compared with £1,492,207 15s. Id. [$7,261,829, par] during the previous year.

d

CASH SUM M ARY FOR 1919.

R e c e ip ts .

Balance brought forward............................................................
Benefit adjustments in respect of period to Dec. 31,1918
From national health insurance fund.....................................
Interest and dividends...............................................................
Other receipts............................................................................
Total......................................................................................
s The National Insurance Gazette, London, June 12, 1920. p. 28L

104936°—28—Bull. 312-----7




£
133,153
2,321
989, 379
149, 256
522
1, 274, 634

s.

14
7
8
17
13
1

d.

6
7
2
8
4
3

94

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

P a y m e n ts .

Benefits:
£
5. d .
Sickness benefit.................................................... 569,415 10 7
Disablement benefit............................................ 150,177 9 3
Maternity benefit................................................. 149,172 5 5
Subscriptions to hospitals, etc..........................
44 9 1
£
s. d.
Total..............................................................., ..................'................. 869,809 14 4
Administration expenses:
Paid to Prudential Assurance Co. (Ltd.),
under agreement.............................................. 227, 049 11 10
Salaries and committee fees.............................. 1,165 6 10
Medical referees ................................................. 4,145 3 9
Sick visitors.......................................................... 27,171 17 11
Arbitration fees and expenses.....................
57 2 10
Transfer of securities............................................
85 4 4
Incidental expenses....................
26 0 7
Total..................................................................................................... 259,700 8 1
Balance carried forward...................... ....................... .............................. 146,123 18 10
Total.................................................................................................... 1, 2 H 634 1 3
INVESTM ENT CASH SUM M ARY FOR 1919.

Receipts.

Balance Dec. 31, 1918....................
60 15 1
From national health insurance fund...................................................... 1,132, 592 0 0
T otal........................................ .......................................................... 1., 132, 652 15 7

Expenditures.

Investments.................................................................................................... 1,132, 223 7 9
429 7 10
Balance Dec. 31,1919......................
Total..................................................................................................... 1,132,652 15 7
c h a i r m a n ’s s p e e c h .

This is the eighth annual meeting of the society and I am pleased to say, as I have
on previous occasions when making my annual report, that the membership of our
societies is being well maintained.
When one realizes the number of societies in existence, and the energy displayed
in their endeavors to get new members, it speaks well, I think, for our administration
that there is anincreasing desire to join one of the prudential approved societies.
Last year we added 126,000 new members, which is a considerable increase on the
previous year when the number was approximately 90,000.
This large annual influx of members does not necessarily mean a net increase in our
membership, for, as you are aware, there is in every year a big natural wastage due to
deaths and passing out of insurance of members ana to other causes.
It is now more than 18 months since the armistice was signed, and although we try
to forget so far as we possibly can the ravages of the Great War, yet its effects are with
us from day to day, and present themselves whenever we deal with matters affecting
the population as a whole.
At the end of 1919, 236,000 of our members were either still in His Majesty’s forces
or had not notified us of their discharge, as you know, the remaining members of the
temporary army were demobilized in April last, so that from this special point of
view we are now only concerned with those who have permanently adopted the navy
or army as a profession.
S ic k n e ss e x p erie n c e .—The sickness experience of those members who have served
probably throws a greater burden upon the societies than would have been the case
had they continued to follow their ordinary civil vocations. It is, therefore, more
than gratifying to know that the cost of sickness benefit for the year was only 71 per
cent of that allowed for in the original estimates of the actuarial advisers to the Govern­
ment.
The accounts show that the amount paid during the year in sickness and disable­
ment benefits was £719,592 19s. lOd. [$3,501,899, par].
As a result of the influenza epidemic at the commencement of the year the amount
paid in these benefits during the first six months was £95,000 [$462,318, par] in excess




OPERATIONS OF THE SYSTEM.

95

of that paid during the corresponding period of 1918, but in the second six months of
1919 the amount so paid was £23,000 [$111,930, par] less than in the second half of 1918.
Maternity benefit.—The experience of the society as regards maternity benefit
presents some interesting features. The total amount paid for this benefit was
£149,172 [$725,945.54, par], which is nearly £23,500 [$114,362.75, par] in excess of the
sum so paid during 1918. This increase is almost entirely due to the last quarter of
the year, the average number of maternity claims per week having been approximately
1,600 between January 1 and August 30; 1,750 during September; 2,400 during Octo­
ber and November, and nearly 3,000 during December. The experience of De­
cember—that is nearlv 3,000 maternity claims per week—is twice as heavy as that of
December, 1918, and it will interest you to know that this large number has been
maintained so far this year. This, while expensive to the society, is highly satis­
factory from the national point of view.
Ten million two hundred and fifty, thousand pounds paid in benefits.—As showing the
magnitude of the work of the prudential approved societies, I may perhaps mention
that the total amount paid by the four societies in benefits from January, 1913, to the
end of 1919, a period of seven years, was approximately £10,250,000 [$49,881,625, par].
The accounts in your hands include an investment cash summary, which states
the amount invested during the year, but does not show the advantages derived by
the society from the knowledge and skill of the trustees in connection with invest­
ments.
As indicated in the report, the amount invested on behalf of this society by the
trustees is slightly over £3,500,000 [$17,032,750, par], yielding an average rate of
interest of £5 4s. 2d. per cent free of income tax, whereas the rate to be employed
in the valuation of our liabilities is only 3 per cent.
The trustees for this society act as trustees for the other three prudential approved
societies, and on behalf of the four societies have invested close on £5,500,000
[$26,765,750, par].
Since 1914 the average rate of interest earned on the total investments increased by
more than £1 per cent, giving, as stated above, a yield of £5 4s. 2d. free of income tax.

ASSOCIATION OF SMALL SOCIETIES.
/

The operations of the insurance require that the very small socie­
ties shall be joined into associations as a measure oi reinsurance.
As an illustration of a small association of this kind, the following is
given:9

Sussex National Insurance Association.—The annual report of the County of Sussex
National Insurance Association has just been issued. It is stated that the associa­
tion has now been officially approved by the commissioners for national health* to
carry on the duties involved under the national health insurance act, 1918. With
one exception, the returns for last year have been sent in by the associated societies,
and the results show a small increase in the total benefits paid out as compared with
the previous year. There has been a reduction in the total sickness benefits (£1,621)
[$7,888.60, par] of £40 [$194.66, par], but an increase in the disablement benefits from
£474 [$2,306.72, par] in 1917 to £545 [$2,652.24, par] in 1918. Maternity benefits
decreased from £253 [$1,231.22, par] to £240 [$1,167.96, par]. The net result is a small
increase in benefit payments as a whole of nearly £18 [$87.602 par]. The number of
societies in the association on December 31, 1918, was 35, with a total membership
of 4,933, excluding members over 70 years of age. The total administration expenses
of the associated societies amount to £716 [$3,484, par], and is under the official
allowance.
Mr. Cautley, K. C., M. P., president of the association, in the course of his report,
said: “ Our societies are perfectly solvent, and will, I am convinced, show considerable
surpluses. The valuation by the Government auditors is now being made. I am
confident that we shall be able to pay a substantially larger sick benefit than the
statutory 10s. [$2.43 par]. This being so, the working men of Sussex in this associa­
tion have a most valuable property and one entirely their own. Every penny saved
goes to themselves. There are no shareholders or other persons to be benefited ex­
cept themselves. I can not believe that if these facts were known to the Sussex
workers they would let such a valuable property go. I regret that, so far, I have not
heard of the suggestion of the formation of juvenile branches, which I made at the
last annual meeting being carried out.”
» The National Insurance Gazette, London, Oct. 11,1919, p. 450.




APPENDIX.—BIBLIOGRAPHY QN NATIONAL HEALTH INSURANCE IN
GREAT BRITAIN.
Abbott, Edith. “ The British health insurance system, ” in Report, recommenda­
tions and dissenting opinions by the Ohio Health and Old Age Insurance Commission.
Columbus, January, 1919. Also, in Report of the Health Insurance Commission
of the State of Illinois. Springfield, May 1, 1919.
American Association for Labor Legislation. Health insurance. American Labor
Legislation Review, June, 1916, v. 6. [Later issues contain extensive studies on
the British system.]
Annan, William. The Duties of Employers under the National Insurance Act, 1911.
Edinburgh and London [1912].
Ashley, Annie. The Social Policy of Bismarck. London, New York [etc.], 1912.
British Medical Association:
Insurance acts committee. Interim report on the future of the insurance acts*
London, 1917.
------Report on the revision of the conditions of service under the national health
insurance acts and possible extensions of service. London, 1919.
“ British social insurance and the doctors’ union,” in Survey, December 14, 1912.
Carr, A. S. Comyns (ed.) W. H. Stuart Garnett, and J. H. Taylor. National Insurance.
4th ed. London, 1913.
Collier, Sir John. Malingering and Feigned Sickpess. New York, 1913.
Dawes,; James A. National Health Insurance: Part 1 of the national insurance act,
1911, indexed and summarized. London, 1912.
Dawson, William H. “ Social insurance in England and Germany—a comparison,”
in Fortnightly Review, August, 1912.
Evans, Laming W. The National Insurance Bill. Summary. 4th ed. West­
minster, 1911.
Fabian Society:
Executive committee. The Insurance Bill and the Workers. London, 1911.
Research department. Committee of Inquiry on the Working of the Insurance
Act. Report. I n The New Statesman (London), March 14, 1914. Special
supplement.
^Fischer, Alfons. Die Mutterschaftsversicherung in den europaischen Landern.
Gautzsch b. Leipzig, 1911.
Foley, Frank S. The National Insurance Act, 1911, as it affects Employers and
Workmen. London, 1911.
Frankel, Lee K. (and Miles M. Dawson, with the cooperation of Louis I. Dublin).
Workingmen’s Insurance in Europe. New York, 1910.
Gadd, Henry W. A Guide to the National Insurance Act, 1911. London, 1912.
Gibbon, loan G. Medical Benefit, a Study of the Experience of Germany and Den­
mark. London, 1912.
Gfeat Britain:
Admiralty. National insurance instructions, 1914. London, 1914.
Board of Trade. In<}ustrial life assurance committee. Report on the business
of industrial assurance companies and collecting societies. London, 1920.
[Cmd. 614.]
96




APPENDIX— BIBLIOGRAPHY,

97

Great Britain—Continued.
Chancellor of the Exchequer:
National health insurance. Statements as to the administration of medical
benefit and correspondence thereon between the Chancellor of the Ex­
chequer and the British Medical Association. . . . London, 1912.
Cmd. 6520.
National insurance bill. Actuarial report on the position of persons in the
naval and military service of the Crown. [Clause 36.] London, 1911.
[Cd. 5809.]
Copy of Memorandum explanatory of the principal amendments which it is
proposed to incorporate in the National Insurance Bill. London, 1911.
[Cd. 5930.]
Replies to letters addressed to the Chancellor of the Exchequer. London,
1911. [Cd. 5733.]
Further replies to letters addressed to the Chancellor of the Exchequer (in
continuation of the series printed in Paper Cd. 5733). London, 1911.
[Cd. 5885.]
Reports of deputations. London, 1911. [Cd. 5869.]
Reports of the actuaries as to the rate of sickness prevailing in the agricultural
districts of Scotland. London [1911]. [Cd. 5966.]
National Insurance Bill and Buntingford Union Association. [Actuarial.]
Report by Mr. A. W. Watson. London, 1911. [Cd. 6001.]
Departmental committee on approved society finance and administration.
Interim report . . . and correspondence thereon. London, 1916. [Cd. 8251.]
Exchequer and audit department. National health insurance fund accounts.
London, 1916. [H. of C. Reports and Papers.]
Government Actuary. National health insurance. Interim report upon the
valuation of the assets and liabilities of approved societies as at 31st December,
1918. London, 1921. (Cmd. 1130.]
Interdepartmental committee on appointment of audit staff (national insurance
act, 1911, Pt. I). Reports. London, 1912. [Cds. 6232, 6243.]
Interdepartmental committee on outdoor staff (national insurance act, 1911, Pt. I).
Report. London, 1912. [Cd. 6231.]
Interdepartmental committee on payment through the post of benefits under the
national insurance act. National insurance acts, 1911-1913. Report. London,
1914. [Cd. 7245.]
Interdepartmental committees under the Crown as affected by Part I of the
national insurance act, 1911. National insurance act, 1911, Pt. I. First report.
London, 1912. [Cd. 6234, 6315.]
Laws, statutes, etc.:
Married women’s special benefits regulations, 1912, dated September 19, 1912
(provisional). [H. C. 309, 1912.] Draft dated September 20, 1912.
Married women’s transfer value regulations, 1914, dated May 22, 1914.
[H. C. 261,1914.]
National health insurance. Statutory rules and orders issued during 1912,
with an index to the statutory powers and rules and orders in force on 31st
December, 1912. . . . London, 1913.
National health insurance acts, 1911-1920. Summary of the provisions of the
national health insurance acts, 1911-1920, for the information of members
of approved societies. London, 1920.
National insurance act, full text (with index). [Glasgow, 1911.] (Issued
with the Glasgow Herald of December 21, 1911.)
National insurance act, 1911. With introduction and notes, by J. A. LovatFraser. . . . London, 1912.



98

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

Great Britain—Continued.
Laws, statutes, etc.—Concluded.
National insurance act, 1911. Index to the health insurance provisions of
the act. . . . London, 1912. [Cd. 6468.]
------Treatise on the scheme of national health insurance and insurance
against unemployment created by that act, by Orme Clarke. London
[etc.], 1912.
National health insurance bill. [London, 1917.] [H. of L. Papers and
Bills, 119.]
------Actuarial report on proposed Government amendments to clause 36
(special provision with regard to persons in the naval and military serv­
ice of the Crown). London, 1911. [Cd. 5943.]
------Copy of a memorandum explanatory of the bill as passed by the House
of Commons so far as relates to national health insurance. London,
1911. [Cd. 5995.]
------Copy of clause 36, as amended, of the national insurance bill: Special
provisions with regard to persons in the naval and military service of the
Crown. London, 1911. [Cd. 5941.]
— - Copy of memorandum explanatory of the bill, Treasury Chambers, 8
May, 1911, D. Lloyd-George. London, 1911. [H. C. 147.]
—— Copy of memorandum on sickness and invalidity insurance in Germany.
London, 1911. [Cd. 5678.]
— - Copy of the national insurance bill, showing the difference between
the bill as introduced in the House of Commons and as passed by that
house . . . London, 1911. [Cd. 598JL]
------Mercantile marine. Copy of memorandum explanatory of the amend­
ments which it is proposed to incorporate in the national insurance bill in
regard to seamen in the mercantile marine. London, 1911. [Cd. 5942.]
National insurance valuation regulations, 1919. Statutory rules and orders,
1919. No. 1119. London, 1919.
The national insurance bill; together with official explanatory memoranda
on its provisions. Report of Mr. Lloyd-George’s speech on the introduc­
tion of the measure, and notes, by the editors of the Poor-law Officers*
Journal. London, 1911.
The law:of national insurance, with introduction and notes, by Edmond
Browne . . . and H. Kingsley Wood . . . 2d ed. London, 1912.
The law relating to national insurance. With an explanatory introduction,
, the text of the national insurance act, 1911, annotated, and appendices
containing regulations, rules, orders, etc., issued by the insurance com­
missioners and the Board of Trade, actuaries* memoranda, etc., by J. H.
Watts . . . London, 1913.
The statutes relating to national health insurance and regulations affecting
the administration of approved societies. London, 1918.
Local Government Board:
National insurance bill. Extracts from reports upon sanitary administration
in certain urban and rural districts . . . London, 1911. [Cd. 5984.]
Sanatoria. List of approved sanatoria, October 1, 1914. London [1914].
—— List of approved sanatoria and other residential institutions. London,
1918.
Ministry of Health:
First annual report, 1919-20. Part IV—Administration of national health
insurance (1917 to 3lst March, 1920).—Welsh Board of Health. London,
1920. [Cd. 913.]
Annual report of the chief medical officer oh the state of the public health for
the year 1920. London, 1921. [Cmd. 1397.]



APPENDIX— BIBLIOGRAPHY.

Great Britain—Continued.

99

Ministry of Health—Concluded.
Memorandum by the Government actuary on the Washington Draft Conven­
tion concerning the employment of women before and after childbirth.
London, 1921. [Cmd. 1293.]
Model rules for an approved society, relating to business under the national
insurance (health) acts, 1911-1919, to form Part II of the existing rules of a
society approved as a whole. London, 1919.
Model rules for an approved society, to be added to the existing Part I rules
when the necessary provision is not already contained in those rules.
London, 1919.
National health insurance bill, 1920. Report by the Government actuary
upon the financial provisions of the bill. London, 1920. [Cd. 612.]
National health insurance (medical benefit) regulations, 1920, made under the
national insurance (health) acts, 1911 to 1919. London, 1920.
Sanatoria. List of approved sanatoria and other residential institutions.
London, 1919.
Second annual report, 1920-21. London, 1921. [Cd. 1446.]
Welsh Consultative Council of Medical and Allied Services in Wales. First
report. London, 1920. [Cd. 703.]
/
Ministry of Reconstruction. Memorandum on the ministries of health bill, 1918.
London, 1918. [Cd. 9211.]
National Health Insurance Commission (England):
Constitution of insurance committees, 1913. London, 1913. [Cd. 6831.]
Employed married women, regulations, 1914, dated May 28, 1914. [H. C.
263,1914.]
Handbook to the administration of sickness and maternity benefits by ap­
proved societies. Provisional issue, January 13 to July 14, 1913.
How rates of remuneration affect health insurance contributions. Official
Explanatory Leaflet No. 18. 2d ed. London, 1914.
Memoranda of decisions under section 66 of the national insurance act, 1911
(with index). April, 1913. London, 1913.
Memorandum on the special measures taken in relation to the supply of drugs
and other medical stores during the war. London, 1919. [Cd. 183.]
National health insurance. Explanatory statement as to medical benefit as
affecting medical practitioners. . . . London, 1912. [Cd. 6542.]
National insurance act, 1911. Order, dated the 18th December, 1913, made
under section 78 of the national insurance act, 1911, entitled the national
health insurance (deposit contributors benefits) order, 1913 . . . London,
1914. [Cd. 7199.]
------Report by the chief inspector to the National Health Insurance Com­
mission (England) on an inquiry into the reasons why certain insured
persons became deposit contributors . . . London, 1913. [Cd. 7034.]
National insurance acts. Handbook for the use of approved societies (English
ed.). (Provisional issue rev. to August, 1915.) Edinburgh, 1915.
National insurance bill. The Insurance Commission for National Health
(England). Copy of papers relating to appointment of staff. London,
1911. [Cd. 6000.]
Report for 1912-13 on the administration in England of the national insurance
act, pt. I. (Health insurance.) . .- . London, 1914.
Reports of decisions on appeals and applications under section 67 of the
national insurance act, 1911, and section 27 of the national insurance act,
1913. . . . London, 1915. [Cds. 7810, 8040.]




100

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN.

Great Britain—Continued.

National Health Insurance Commission (Ireland):
Medical benefits committee. National insurance act, 1911—medical benefit,
Ireland. Report of the committee appointed to consider the extension
of medical benefit under the national insurance act to Ireland.;. . . Lon­
don, Dublin, 1913. [Cd. 6963.] Appendices to the Report. [Cd. 7039.]
National Health insurance act, 1918. Supplement to the Handbook for the
use of approved societies having members resident in Ireland. Dublin,
1918.
Report for 1912 on the administration in Ireland of the national insurance act,
Pt. I. (Health insurance.). . . London, 1913.
Report on the administration of national health insurance in Ireland during
the period November, 1917, to 31st March, 1920. Dublin, 1921. [Cmd.
114L]
National Health Insurance Commission (Scotland):
National health insurance. Handbook for the use of insurance committees
in Scotland. (1st October, 1915.) Edinburgh, 1915.
National insurance act, 1911. Handbook to the administration of sickness
and maternity benefits by approval societies in Scotland. London, Edin­
burgh, 1913.
National insurance acts. Handbook for the use of approved societies (Scot­
tish ed.). (Provisional issue rev. to August, 1915.) Edinburgh, 1915.
Report for 1912 on the administration in Scotland of the national insurance
act, Pt. I. (Health insurance.) . . . London, 1913.
Statement showing the number of insured persons, the number of members of
each approved society, and the number of deposit contributors, in the
area of each insurance committee in Scotland.* . . . London, 1913. [Cd.
7109.]
National Health Insurance Commission (Wales):
National insurance acts. Handbook for the use of approved societies (Welsh
ed.). (Provisional issue rev. to August, 1915.) Edinburgh, 1916.
Report for 1912 on the administration in Wales of the national insurance act,
Pt. I. (Health insurance.) . . . London, 1913.
National Health Insurance Joint Committee:
Committee on drug tariff under national insurance acts. National insurance
acts. Report . . . London, 1915. [Cds. 8062, 8063.]
Committee on national insurance act (medicines). National insurance act,
1911. . . . Report [Evidence and appendices]. . . . London, 1913.
[Cd. 6853-6854.]
Committee on sickness benefit claims under national insurance act. National
health insurance. Reports [and Appendix. . . . ] . . . London, 1914.
[Cd. 7687-7691.]
Medical benefit under the German sickness insurance legislation . . . London,
1913. [Cd. 6581.]
Medical research committee. . . . Bacteriological studies in the pathology
and preventive control of cerebrospinal fever among the forces during
1915 and 1916 . . . [London, 1917.] (Special report series, No. 3.)
------Interim report on the work in connection with the war at present
undertaken by the medical research committee. . . . London, 1915.
[Cd. 7922.]




APPENDIX— BIBLIOGRAPHY.

101

Great Britain—Continued.
National Health Insurance Joint Committee—Concluded.
Medical research committee. National health insurance. First [-Fifth]
annual report of the medical research committee. . . . 1914/15 [-1918/19].
London [1915-]19. [Cd. 8101, 8399, 8825, 8981; Cmd. 412.]
------Report for the year 1919-20. London, 1920. [Cmd. 1088.]
------Reports upon investigations in the United Kingdom of dysentery cases
received from the eastern Mediterranean. . . . London, 1917.
------Spedalad visory committee. . . . Report upon bacteriological studies
of cerebrospinal fever during the epidemic of 1915. [London, 1916.]
National health insurance. Memorandum explanatory of the provisions of
the national health insurance bill, 1917. . . . London, 1917. [Cd. 8816.]
------Notes explanatory of the national health insurance bill, 1917, as passed
by the House of Commons. London, 1917. [Cd. 8896.]
National insurance act, 1911. List [s] of approved societies. . . . London,
1912. [Cd. 6238, 6284.]

-----(B.) Model rules for an approved society with male members only.

. . . London, 1912.
--------------Rev. ed. London, 1912.
------National health insurance. Memorandum and report on substituted
benefits under section 13, together with an actuarial memorandum. . . .
London, 1912. [Cd. 6292.]
National insurance act (1911)- amendment bill. Memorandum upon the
general objects of the bill. . . . London, 1913. [Cd. 6914.]
National insurance acts, 1911 to 1913. National health insurance fund
accounts for the period 12th January to 31st December, 1914. London,
1917. H. of C. Paper 38 of 1917.
National insurance (health) acts, 1911 to 1918. Return as to the administra­
tion of sanatorium benefit, 1917-18. London, 1919. [Cmd. 232.]
National insurance (health) acts. Summary of the provisions, 1911-1918,
for the information of members of approved societies. London, 1918.
National insurance acts, 1911 to 1919. National health insurance fund
accounts. Appendix. Approved societies and insurance committee8,
receipts and payments for 1915-16. London, 1920. [Cmd. 691.]
National health insurance acts, 1911 to 1920. List of approved societies oper­
ating in more than one part of the United Kingdom and in England,
Scotland, Ireland, and Wales, respectively. London, 1920.
Outworkers committee. . . . Report of the committee appointed to consider
and advise with regard to the application of the national insurance act to
outworkers. . . . Report [with evidence and appendices]. London, 1912.
[Cd. 6178-6179.]
Report on approved societies’ administration allowance. London, 1921.
[Cmd. 1291.]
Report on the administration of the national insurance act, Pt, I (health
insurance). London, 1913 [to date]. 1912-13 [Cd. 6907]; 1913-14 [Cd.
. 7496]; 1914-17 [Cd. 8890].
The approved societies’ handbook to the administration of sickness and
maternity benefits unher the national insurance act, 1911. Provisional
issue. January 13 to July 14,1911. London, Dublin, 1913.
The statutes, regulations, and orders relating to national health insurance,
with notes, cross references, and an index. London, 1916.
National insurance audit department. . . . Report on the work of the national
insurance audit department. . . . 1st .1912-14. London [1915 to date].




102

NATIONAL H EALTH INSURANCE IN GREAT BRITAIN,

Great Britain—Concluded.
Parliament:
House of commons. Reprint from the Parliamentary Debates of all Ques­
tions and Answers in the House of Commons Relating to the National Insur­
ance Act, 1911. February 14 to August 7,1912.
------Reprint from the Parliamentary Debates of all Questions and Answers
in the House of Commons Relating to National Health Insurance. October
7,1912, to March 7,1913.
------Standing committee on bills, A. Report on the national health insurance
bill with the proceedings of the committee. London, 1917. [H. of C.
Reports and Papers 164.]
Registry of Friendly Societies:
Adjusted rates of sickness and mortality, and expectation of sickness based
thereon; and monetary tables (together with introductory report) reprinted
from sickness and mortality experience deduced from the quinquennial
returns made by registered friendly societies for the years 1856 to 1880,
inclusive, together with a report, . . . by William Sutton . . . London,
1912.
Guide Book. Revised to January 1, 1920. London, 1920.

Scotland:

Board of‘Health. Appendix to the First Annual Report. 1919. London,
1920. [Cmd. 992.]
— - Second Annual Report, 1920. Edinburgh, 1921.
------National health insurance. Report on the administration of national
health insurance in Scotland during the years 1917-1919. London, 1920.
[Cmd. 827.]
Treasury:
Committee on approved society finance and administration, National
health insurance. Interim repprt. London, 1916. [Cd. 8251.]
——
Further report. London, 1916. [Cd. 8396.]
---------— Final report. London, 1917. [Cd. 8451.)
National insurance bill. Copy of memorandum on sickness and invalidity
insurance in Germany. London, 1911.
National insurance bill, 1911. Pt. I. Report of the actuaries in relation
to the national insurance bill as amended in committee—London, 1922.
[Cd. 5983.]
Report of the actuaries in relation to the scheme of insurance against sickness,
disablement, etc., embodied in the national insurance bill, 1911. London,
1911. [Cd. 5681.]
Halsey, Olga S.; “ Compulsory health insurance in Great Britain,” in American
Labor Legislation Review, June, 1916.
Hardy, George F. and Frank B. Wyatt. “ Report of the actuaries in relation to the
scheme of insurance against sickness, disablement, etc., embodied in the national
insurance bill, 1911,” in Institute of Actuaries Journal, July, 1911.
Harris, Henry J ., ‘‘Maternity benefit systems in certain foreign countries.’’ United
Spates Children’s Bureau. Publication No. 57. Washington, 1919.
Hayes, Carlton H. “National insurance,” in his British Social Politics. Boston,
1913.
Hoffman, Frederick L .:
“ Facts and fallacies of compulsory health insurance. ’’ Address before American
Association for the Advancement of Science, December 28,1916. Newark, 1917.
More Facts and Fallacies of Compulsory Health Insurance. Newark, 1920.
National Health Insurance and the Friendly Societies. [Newark, 1921.]
“The methods and results of national health insurance in Great Britain (pre­
liminary report).” Address,'twentieth annual meeting of the National Civic
Federation, January 30,1920. [New York, 1920.]



APPENDIX— BIBLIOGRAPHY.

10?

International Congress on Social Insurance:
1st, Paris, 1889.
2d, Bern, 1891.
3d, Milan, 1894.
4th, Brussels, 1897.
5th, Paris, 1900.
6th, Dusseldorf, 1902.
7th, Vienna, 1905.
8th, Rome, 1908.
International Institute of Agriculture. Bureau of economic and social intelligence.
National insurance act: Compulsory insurance against sickness and unemployment.
Bulletin, April, 1912.
International Labor Office. Bulletin. [1906J-1921.
Jenny, Oskar H. Das Englische Hulfskassenwesen In Neuester Zeit. . . . Bern,
1905.
Liberal Publication Department. The national insurance act. London, 1912.
Lloyd-George, David:
“ The National Insurance B ill.” Speech in introducing the bill, House of Com­
mons, May 4,1911. London, 1911.
The People’s Insurance. London, New York [etc.], 1912.
“Medical service under the insurance act. ” In New Statesman, November 1, 8,1913.
Money, L. G. Chiozza. A Nation Insured. London, 1911.
National Civic Federation. Social insurance department. Report of the committee
on preliminary foreign inquiry. New York [n. d.].
National insurance act. A full explanatory digest, by “An old parliamentary hand.”
London [1912].
National Insurance Year Book. London.
Newsholme, Sir Arthur. Public Health and Insurance. American addresses.
Baltimore, 1920.
Pope, Samuel. . . . Married women outworkers. Report on the objections raised
against the draft special order including married women outworker^ within the
provisions pf Part I of the national insurance act. London, 1913. [Cd. 6600.]
Ramsey and Tead. Report of investigation into the operation of the British health
insurance act. By William T. Ramsey, chairman of the health insurance com­
mission of Pennsylvania, in company with Ordway Tead, expert investigator.
For the Pennsylvania Health Insurance Commission of 1920. [n. p.] 1921.
Schuster, E. J.:
“ National health insurance in England and Germany, ” in Society of Comparative
Legislation Journal, July, 1911, n. s.
National Health Insurance; the parliamentary bill examined and compared
with the German scheme. 2d ed. [Rev. and enl.] London, 1911.
Simmon da, Reginald C. “ Some aspects of the national insurance act, 1911. (Pt. I.
National health insurance.)” in Institute of Actuaries Journal, April, 1913.
Smith, Thomas. Everybody’s Guide to thte Insurance Act. London, 1912.
Sweden. Socialstyrelsen. Tvangssjukforsakringen i Tyskland och England. Stock­
holm, 1919.
Tibbetts, Thomas M. The Panel Doctor, His Duties and Perplexities. [2d ed.]
London [1918].
United States:
, Bureau of Labor Statistics—
British national insurance act, 1911. Bui. No. 101. Washington, 1912.
Twenty-fourth annual report, 1909. Washington, 1911.
Warren, Benjamin S., and Edgar Sydenstricker. . . . Health Insurance: Its relation
to the public health. [2d ed.] Washington, 1916.




o