Type: Economics
Pages: 9 | Words: 2620
Reading Time: 11 Minutes

The United Kingdom is a well-developed country with a stable economy. It has significant political, cultural, military and scientific influence on all Europe. Its healthcare system is one of the best in Europe. The aim of this paper is to show all sides of the UK healthcare system, its advantages and disadvantages.

The United Kingdom provides public health treatment to all people who need it, even for permanent residents and it is approximately 58 million people. General taxation covers health care needs and they are free if it is promptly. About18 percent of citizen’s income tax the authorities give to the health care. The expenditure on health care in the UK is about 8.4 percent of the GDP. The private health care sector is smaller than public but it develops rapidly (Chang, Peysakhovich, Wang & Zhu, n.d.).

Background of the UK Healthcare System

The National Health Service (NHS) was established in 1946. It is liable for the public health care sector of the United Kingdom. Before 1946, medical care was accessible only to affluent people. Some people could get free medical care through charity or hospitals. In 1911, David Lloyd George introduced the National Insurance Act in which some sums of money were assigned from the people’s wages and it gave them right to free treatment. It was like modern insurance in many countries. Nevertheless, this system gave health treatment only for people who had official job. After the Second World War, all attempts were undertaken to launch a public medical care system that would be free. All the services were free. The money for it was taken from central taxation. Everyone could get qualified and free medical care. During the 1960-1965 was established tripartite system. The healthcare system was split into three branches: the hospital services, the primary care and the Community Services. Of course, such splitting led to many problems but local authorities provided reforms and reorganization of these branches that allowed assisting all three areas of care. Under the Thatcher’s rule, the management system was restructured. In 1990, the Community Care Act and the National Health Service were passed and it allowed setting up self-governing Trusts that controlled hospital care. During the Blair government, other reforms were held. These reforms had the goal to improve health care standards and make lower costs for treatments (Chang, Peysakhovich, Wang & Zhu, n.d.).

A few years ago, many changes were made in the NSH. Due to this the NHS will be rebuilt the current government management structure by 2014. The doctors will receive around 80 percent of the NHS budget and they will spend this money to the urgent needs.  The aim of these reforms is to support the continuing privatization of the health care industry. It will give more alternatives to the patients. Therefore, these reforms will help to make lower costs and patient waiting times.

Medical treatment in the UK is given to all people who have the legal right to live there. In addition, health care can get citizens from other places with mutual covenants from the NHS and for the residents of the EEC (European Economic Community). The first aid is provided without any payments. It can be prophylactic, rehabilitation and physician services and psychic health care. However, there are some cost apportionment requirements for dental treatment. Children, people with physical defects or with low-income and pregnant women are often free from these payments. In 2005 about 12 percent of total outlays that were given on health care were formed from the out-of-pocket payments.  

The large majority of the UK citizens have confident in the NHS for health care. However, some people prefer to buy the additional private insurance policy. The statistics shows that in 2001 only about 11.5 percent of citizens bought the additional private insurance policy. In 1980s, the number of people who bought the additional private insurance policy increased because of big variety of doctors, better medical treatment, and lower cost of medical care and less waiting lists (“International health system, n.d.). 

Development and progresses

In 1990s, the UK government made the most important changes in the NHS. The government created the internal market. Doctors had to be the part of the internal market (later, the NHS) and it gave them the possibility to contend for patients. These markets were independent. All the markets were managed individually. In addition, they contended with each other. There were nearly 57 trusts and in the 90s, all medical care in the United Kingdom was provided through these trusts. In 1998 was founded the NHS Plan and it helped to modernize the NHS. NHS Plan gives to citizens more power and information, more beds and nurses, more doctors and shorter waiting lists. For old people the NHS Plan gives improved health care. The standards of health care are very high.  

UK Healthcare system

The UK has a healthcare system that is sponsored by the government. This system is the NHS. The NHS consists of many healthcare systems. Public funds give the main amount to them. The UK’s NHS included NHS Scotland, NHS Whales, NHS England, Health and Social Care in Northern Ireland.  All citizens are allowed to use this system but also they are allowed to choose and buy private health insurance. Different reforms which were made led to such fact that the UK’s medical system is very efficient and one of the best in the world. The surveys that were conducted by seven industrialized countries confirmed this fact. The NHS Plan is a good example of this. The NHS Plan offers the patients more information, the bigger choice of nurses and doctors. In addition, NHS Plan can offer the patients improved medical care for older people.  The Commonwealth Fund report distinguishes five fields of fulfillment. They are quality, efficiency, access to treatment, impartiality and healthy lives.Very close to the UK and Australia is the Netherlands. The UK ranked highly in quality of treatment and access to treatment. In addition, the UK ranked high in efficiency. This fact can be improved by the examining the sums which are spent on the health care, on its management and insurance. In the report, In the UK is one of the shortest waiting times for basic medical care and to the services after hours. However, for specialist’s care and surgery which is not in emergence take longer waiting times.

How is the health system financed?

The UK’s healthcare system covers services, cost-sharing and safety nets. Healthcare services are very various. They are included dental care, outpatient reception hours and hospitalization (including drugs for these types of care), prophylactic care, therapists’ help and rehabilitation. For public cover services the UK’s healthcare system applied cost-sharing. Such arrangements help to spend less money to the medical care. According to these agreements dental treatment costs about $200 per year instead of  $400. In addition, drugs prescriptions take from the charges. However, sometimes patients have to pay additional payments for such services. Additional payments in 2005 accounted about 11,9 percent of the entire expense on health. Safety nets preserve the special groups of patients from additional payments for drugs prescriptions and dental treatment. Such groups consist of people aged over 60, children under 16, people whose income is low, women who are pregnant or had the child in the last year and people who are disabled. The public purse gives the most costs for these people.

The government reached such good results in the UK’s healthcare system because of good financing. As were mentioned the UK’s healthcare system divides into the NHS and private health insurance. In its turn, the financing of  these two systems is also different.  The total medical consumption of NHS accounts about 86 percent. Mainly, the NHS is funded by national insurance contributions (about 19 percent). In addition, general taxation, which is about 76 percent and consumer charges, which is about 5 percent form the NHS’s budget. Different fees and charges make some income too. In addition, additional payments, such as dental treatment and drugs prescriptions, give not small amounts. Some money the NHS gets from the private patients who use NHS services.

Private health insurance is the second part of the UK’s healthcare system. Of course, it is not so popular as NHS but some people prefer the private health insurance to NHS. A combination of commercial and non-commercial assurers provides additional health insurance, which is called private. For the private health insurance people pay money additionally, out of their pockets. Some patients do this because insurance gives many benefits to them. They have a big choice of doctors, hospitals offer short lines for surgery and higher level of services. They can get their treatment in the private sector. That is more comfortable than the NHS. The private health insurance chooses about 12 percent of the population. The private insurance accounted for 1 percent of total health consumption in 2004. Treatment in the private sector takes extra payments. These services are not included in the NHS. Such payments form about 90 percent of total private consumption on health.           

How is the delivery system organized?

The delivery system in the UK in different places is organized in its own way. It consists of physicians, hospitals, government and private insurance funds. Physicians (general practitioners, GPs) are the first who contact with patients. GPs is a straight enter to secondary medical services. In the UK exists primary care trusts (PCTs). Primary care trusts (PCTs) directly settle payments using a mixture of procedures: salary, capitation grant and payment for service. The contract, which was made in 2004 for GP, instituted a range of different local contracting probabilities. One of the great possibilities was providing financial motives, which led to achievement of clinical targets. Private suppliers of GP set their prices and payment for services.

NHS trusts unite all hospitals in the United Kingdom. The Department of Health manages all hospitals. A few years ago, foundation trusts became self-governing public trusts.

Of course, government takes a particular place in the UK’s healthcare system. The NHS Executive and the Department of Health control the NHS. For good work of the UK’s healthcare system delegates of medical care services (PCTs) and providers (hospital trusts, GPs) established many agreements. PCTs manage about 85 percent of the NHS budget. PCTs were liable for the supply of community services for the local populations. A few years ago, the government elaborated policy, which allowed patients to choose the hospitals. In addition, the government introduced the indemnification of hospitals using the special system. This system is known as Payment by Results (PbR). Payment by Results connects payment to the quantity and combination of services that were given. Private insurance funds supply their patients and subscribers with medical care at NHS and private hospitals. It is very convenient because patients extensively can choose from a great number of medical care suppliers.

What is being done to ensure quality of care?

Quality of medical treatment is very important in the UK. In 2007 a Department of Health had to improve the quality of health and social treatment services. The medical care considers qualitative only if the quality issues are addressed in the line of ways including: regulatory bodies, targets, National Service Frameworks (NSFs), benchmarking and improvement. Regulatory bodies, public and private suppliers provide an access the quality of health services. It means that all providers have to appraise health services and give their appraisal to the regulatory bodies. For regulation in England are responsible three bodies: the Healthcare Commission, the Commission for Social Care Inspection and Mental Act Healthcare Commission. The government sets the targets to the regulatory bodies and to the Department of Health to monitor the quality of the health care in the UK. In 1998 the Department of Health has developed a set of National Service Frameworks (NSFs) for improving some areas, for example, cancer, diabetes, mental health or coronary. Recently the Department of Health created Quality and Outcome Framework. This framework was made for appraising the quality of GPs. For improving efficiency the government set high-level efficiency targets. In March 2008 the government was adopted Gershon efficiency Program. This program allows to obtain cost-effective transactions and increase the efficiency of social care provisions. NHS organizations improve the efficiency with the help of benchmarking. They are against the length of stay for common operative procedures and day case rates. The Department of Health supports the development of the Institute for Innovation and Improvement. This institute helps the NHS to deal with the introduction of new technologies and changes. In addition, they spread this information throughout the NHS (Boyle, 2008).

In such huge system, the government must control costs. For this purpose, the government made the budget for the NHS. This budget set on a three-year cycle. For controlling utilization, the government made another budget for PCTs. Every year for better work, NHS trusts and PCTs reach a financial balance.


The Department of Health must improve the health condition of citizens. That is why the government elaborated different programs: for urban and rural population. The programs for the urban population are expected the creating of organizations such as Primary Care Trusts, Strategic Health Authorities, which can help to improve the health condition of people in towns.  The primary Care Trust is very useful because it is the first source of information about all medical centers etc. It cooperates with a wide range of partner agencies, commission hospitals and community services. It allows to develop good community care services. Strategic Health Authorities have to integrate national priorities into local plans and strategies.

There are different programs for the rural population. In the countrysides the government forms such organizations as the Countryside Agency and the Institute of Rural Health. The agencies were formed for making life better for urban population and improve the quality of the health care system in the countrysides. In 1997 the government founded the Institute of Rural Health. The main goal of this institute to inform, develop and promote health and wellbeing of rural people.

Challenges for the primary care

There are many challenges for the UK’s government. The UK’s healthcare system is a big machine, which must be controlled and organized. The care suppliers will be a leading part, which can set the budget based on community needs. Today nobody can imagine that PCGs will resolve all fiscal and quality problems by this budget process. However, the physicians and nurses are reliable for the program and maybe the outcome will be unexpected. This program will be more suitable for community and it will satisfy all needs of the patients.

Disadvantages and Shortcomings of the Current System

Of course, the UK’s healthcare system has some disadvantages. The active role of the government in health care makes weaker the functionality of market mechanisms. In addition, the government set up a tight control to medical expenses. As the result of this is a lack of equipment, doctors and nurses in public hospitals. The public makes vast using of medical services, which are free of charge. This is one of the causes of long lines in the public hospitals.  

Summing up the overview about the UK’s healthcare system were emphasized the following items:

  1. The UK’s healthcare system is one of the best in the world, according to the research of international companies. It s best because of quality, efficiency of the health care and access to the health care.
  2. The government makes everything for improving the healthcare system. It creates different organizations, trusts and funds for managing all structures that are connected to the UK’s health care system.
  3. The UK’s healthcare system is divided into public and private. It is a big advantage because, due to this, people have a choice. If they do not have much money they can choose the public healthcare system. If they are wealthy and they want they can choose the private healthcare system.
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