A new model of healthcare provision for the UK, involving partnership between the public and private sectors, is being put to the Government by Norwich Union Healthcare.
A new model of healthcare provision for the UK, involving partnership between the public and private sectors, is being put to the Government by Norwich Union Healthcare.
The proposal incorporates successful elements of the German, Spanish and Dutch health systems.
But it has also been developed in a way which makes optimum use of the existing and unique advantages of the NHS.
The principle of Stakeholder Health Care was devised by Norwich Union Healthcare with NERA (National Economic Research Associates). It will be debated at a fringe meeting of the Labour Party Conference on 3 October, held by Norwich Union Healthcare in association with the Social Market Foundation, the independent think-tank.
The key aims of Stakeholder Health Care, which is a long-term plan to improve health funding over the next 10 years, are:
- To improve patient choice while preserving the fundamental values of the NHS
- To increase the resources available for the UK health system
- To ensure fair and equitable access to health service regardless of people’s income or state of health
Under Stakeholder Health Care the NHS would act as an insurer, competing with private health insurers to provide a standard package of services.
Individuals would pay the insurer of their choice a premium based on community rating – ie a premium unrelated to their health risk. Income tax rates would reduce to reflect this.
The system would use some tax-funding to subsidise premiums where necessary and to cover premiums for some groups, eg the disabled, unemployed and those on benefits. Insurers would be required to accept all applicants.
Tim Baker, commercial director for Norwich Union Healthcare, said: "It is important to recognise that the role of the NHS continuing as the main provider of health services is fundamental to the Stakeholder Health Care model.
"But despite recent impressive increases in NHS spending, under the present system it is difficult for increases in tax- funded revenues to keep pace with demand for more and better health care.
"Many people are willing to pay for extra health services beyond those provided by the NHS. Our model reflects this, while making optimum use of the experience and expertise of the NHS and creating a partnership between the public and private sectors which we believe would bring great benefits to everyone."
The standard package of services funded by Stakeholder Health Care premiums would be determined by the Government, and would be as wide as possible. Individuals could also pay for additional services outside the standard package if they chose.
The funding of the system would be overseen by an independent body that would distribute resources to the NHS and other stakeholder insurers on the same risk-adjusted basis, so insurers would have no reason to prefer healthier or wealthier individuals.
Although the new system would represent a shift away from a fully tax-financed health service, it is envisaged that the NHS would probably remain the dominant insurer.
"The scheme itself should be seen as a levelling up to a better, one-tier, free-choice system," said Tim Baker.
"It seeks to bring private health insurers into the public sector and make them available to everyone, regardless of ability to pay."
Media contacts:
Louise Zucchi, Norwich Union Press Office 08703 666860
Edward Bramley-Harker, NERA 0207 659 8534
Notes to Editors
- Norwich Union Healthcare was founded in 1990 as the healthcare arm of Norwich Union and now provides a range of income protection and private medical insurance products to to around 750,000 customers. It is one of the largest providers of income protection and private medical insurance in the UK.
- National Economic Research Associates (NERA) is an international economic consulting firm founded in 1961 to provide clients with practical research and analysis of economic and financial issues arising in public policy, regulation, litigation and management. In the health sector, NERA has worked across Europe for governments, policy makers and private sector clients, providing advice on all aspects of health sector financing and reform. NERA employs some 300 professional economists in offices in the United States and in London, Madrid, Sydney and Brussels.
- CGU and Norwich Union merged on 30 May 2000 to create CGNU plc - the UK's largest insurance group and one of the top-five life insurers in Europe with substantial positions in other markets around the world, making it the world's sixth largest insurer based on gross worldwide premiums.
- CGNU's principal business activities are long-term savings, fund management and general insurance, with worldwide premium income and retail investment sales from ongoing business of over Ł27 billion and assets under management of more than Ł200 billion.
- From October 2000, the combined life and pensions, general insurance and retail fund management businesses in the UK operate under the Norwich Union brand, while the institutional investment business operates under the Morley Fund Management brand.
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- Norwich Union’s news releases are available on this site
- A selection of images are available from the CGNU Newscast site at www.newscast.co.uk
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