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David Lloyd George's National Health Insurance Act of 1911 provided for the compulsory insurance of lower paid workers and set a fixed capitation fee for doctors. The government paid two ninths of these fees; the remainder was made up by insurance. National Health Insurance Committees, which represented doctors, local authorities and approved societies, administered the system. However, the act only applied to wage earners, their families had to rely on the outpatient clinics of voluntary hospitals for treatment and many were not covered at all.
In 1919, the government increased insurance benefits and contributions. Due to the impending economic crisis, however, the government sought to reduce expenditure, a theme that continued throughout the 1920s. The National Health Insurance (Amendment) Bill of 1922 reduced the doctors' capitation fee. The fee was subject to much debate and was at nine shillings by the time the National Health (Cost of Benefit) Bill of 1924 had been drafted.
In 1924, the Minister of Health, John Wheatley announced the appointment of a Royal Commission on National Health Insurance. The Commission produced a majority and minority report in 1926. The majority report found the system effective and recommended the extension of insurance to dependents. A minority report found that the involvement of industrial insurance companies was detrimental to the expansion of public health, and recommended provision through public funding. Despite this, little was achieved.
The Economy (Miscellaneous Provisions) Bill of 1926 reduced the government's contribution to the health scheme, and was an attempt to force insurance companies to increase funding. A further National Health Insurance Bill of 1928 made minor reforms, such as relaxing members' payment of arrears, but made no provision for the extension of insurance. Large increases in sickness benefit were paid out by 'approved' societies during the 1920s. Lobbying of the industry and complaints about 'malingering' resulted in the National Health Insurance and Contributory Pensions Act of 1932, which reduced the level of benefit paid. National Health Insurance remained in place until the establishment of the National Health Service in 1948.
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