The Rise of the Modern Welfare State

1
The Rise of the Modern Welfare State

• Britain
• Canada

2
Britain

• National Health Service Act (1946)
• Universal coverage for
• Physician visits
• Hospital stays
• Public health
• 100 years earlier, no provision for government
  sponsored health care

3

• This lecture will examine the forces that created
  this dramatic change in the financing of health
  care
• 3 landmark pieces of legislation
• 1834 New Poor Law
• 1911 National Insurance Act
• 1946 National Health Insurance Act

4

• Have already considered
• 1601 Poor Law
• 1834 Poor Law
• Have discussed their connections to
• Medical care
• Rise of health care institutions

5

• Medical care for the sick poor created another
  dilemma
• Fears that the poor laws might be creating a
  disincentive to work

6

• The superiority of the condition of the paupers
  over that of the independent labourers as regards
  medical aid will . . . encourage a resort to the
  poor-rates for medical relief . . . and will thus
  tempt the industrious into pauperism.

7

• Existing institutions could not keep up to demand
  for hospital/medical care
• Voluntary hospitals
• Workhouse infirmaries
• Many patients excluded from treatment
• Children
• Terminally ill
• Chronically ill
• Contagious diseases

8

• Many sick who had no access to care
• Only resort was the poor laws
• Significant stigma
• Until 1885, anyone using poor law medical service
  lost the right to vote

9

• First reforms came in 1860s
• Lancet exposé of conditions in workhouse
  infirmaries
• Forced government inquiry
• New poor law (1867)
• Sick poor should be housed separate from rest of
  workhouse population

10

• In London, separate facilities built
• Became Englands first state hospitals
• 1905 Royal Commission on the Poor Laws
• Two reasons for this development
• More women elected as Guardians
• More working class people could vote for
  Guardians

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• Report published 1909
• Attributed half the destitution in the nation to
  sickness
• Majority report
• Tinkering with current system
• Replacement of workhouses with more specialized
  institutions catering to specific populations

12

• Minority report
• Dismantle system
• Emphasize prevention of destitution rather than
  relief of destitution
• Liberal government of the time chose not to act
  on either report

13

• Still strong indication that the moral
  assumptions underlying poor laws were collapsing
• Consensus that stigma attached to medical relief
  deterred people from seeking legitimate medical
  aid

14

• Reluctance to go of concerns about the character
  of the poor
• Still focussed on self-sufficiency
• Poor should provide for themselves
• Public assistance should be last resort

15

• Sickness insurance was available at the time
• Very selective as to who they would insure
• Many conditions excluded
• Failure to pay premiums resulted in loss of all
  accumulated benefits

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• National Insurance Act (1911)
• Two parts
• 1. Medical insurance
• Compulsory medical insurance with contributions
  from employer, employee state
• Replacement of lost earnings
• Free medical care for insured worker

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• 2. Employment insurance
• Provided 15 million working people with medical
  care protection from earnings lost by sickness
• Rejected idea that poverty was the individuals
  fault

18

• Paid benefits even when worker might have been at
  fault
• Rejected the idea that public assistance weakened
  self-reliance or independence

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• Major opposition came from physicians
• Insisted that upper income limit be imposed
• Middle class continued to rely on private medical
  care
• Argued with the Lloyd George government over
  compensation under the plan

20

• Tried to orchestrate profession-wide refusal to
  accept NIA patients
• GPs refused to comply

21

• Profitable for private insurance companies
• Collected NIA contributions
• Paid out benefits on state-mandated scale
• Served as basis for more comprehensive program
  that was established after WWII

22

• Gaps in NIA
• Did not cover hospitalization
• Did not cover dependents
• 1941 opinion poll
• 85 favoured state organized medical service
• 55 favoured nationalizing hospitals and medical
  care

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• Beveridge Report (1942)
• Actually concerned with post-war reconstruction

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• Five great giants on the road to reconstruction
• Want
• Ignorance
• Idleness
• Disease
• squalour

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• Included proposals for
• Social insurance
• Comprehensive publicly funded medical insurance
• Paved way for establishment of National Health
  Service (1946)

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• Role of women in the development of the welfare
  state
• 1st wave feminism
• Diverse group of women
• Similar concerns re women children
• Different political agendas

27

• Earlier historians referred to this phenomenon as
  maternal feminism
• Contemporary historians have categorized them as
• Sentimental maternalists
• Progressive maternalists
• Feminists

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• What was their impact on the welfare state?
• Lobbied for special protection of women and
  children
• Child welfare programs
• Mothers allowance

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• Lobbied for programs to strengthen families
• Temperance
• Pensions
• Lobbied for programs to support the male
  breadwinner
• Unemployment insurance
• Health insurance

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• Lobbied for franchise for women
• This platform tended to set the feminists aside
  as a distinct group

31
Canada

• Developments similar to other countries
• Exact details shaped by Canadian form of
  government
• Federal rather than unitary
• Health a provincial responsibility

32

• In 19th century, provinces left welfare health
  issues to municipalities
• Voluntary hospitals
• Municipalities often provided some funding
• Charitable organizations
• Public funding for care of destitute

33

• Aftermath of WWI forced some changes to the
  system
• Federal program for returned veterans
• Social assistance
• Medical assistance

34

• Provincial initiatives to improve citizens lives
• Highway construction
• Education
• Mothers allowance
• Old age pension

35

• Most significant influence on development of
  Canadian welfare state was the Great Depression
• Bankrupted municipalities
• Nearly bankrupted several provinces

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• Winnipeg doctors strike
• Physicians always did some charity work
• By 1933, believed they were undertaking unfair
  burden
• Wanted a municipal subsidy
• Refused to treat non-emergency cases who were on
  relief
• Began July 1, 1933

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• In early 1934, imposed very stringent definition
  of emergency
• City came to agreement with Winnipeg Medical
  Society in Feb. 1934
• Underwrote medical care of the indigent in
  Winnipeg until 1960s

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• Great Depression had similar impact on other
  parts of the country
• Only Ontario provided provincial funds to defray
  medical relief costs
• All other provinces left it to municipalities
• After depression 4 provinces followed Ontarios
  example

39

• Federal government had limited capacity to
  respond to the crisis
• BNA Act gave these responsibilities to the
  provinces
• Also, sometimes, limited interest in doing so
• Royal Commission on Dominion Provincial Relations
  (Rowell-Sirois Commission) 1937

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• Report tabled 1940
• Acknowledged that municipal provincial
  governments had limited capacity to provide
  medical social services

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• Recommendations
• Transfer jurisdiction over taxation to feds
• Feds assume responsibility for unemployment
  insurance old age pensions

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• Provinces to retain responsibility for health
• Based on assumption that medical care of indigent
  would continue to be provincial responsibility

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• Many physicians were committed to state sponsored
  medical insurance
• Had established physician sponsored health
  insurance plans

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• Endorsed by CMA in 1934
• Private insurance market developed
• Many plans also sponsored by physicians
• Ontario, 1938
• By 1950, all across Canada

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• In Manitoba, Manitoba Medical Insurance
• Most were not-for-profit
• Pressure continued to be exerted on feds to
  respond in some way

46

• Post war reconstruction planning
• Two reports released in 1943
• Report on Social Security for Canada (Marsh
  Report)
• First comprehensive plan for social security

47

• Report of Advisory Committee on Health Insurance
  (Heagerty Report)
• Recommendations for creation of national health
  insurance program
• Constitutional changes needed to implement these
  initiatives

48

• In post-war period, only 6 of Canadians had
  health insurance
• Rose to 50 by 1950s
• Insurance plans had problems
• Restrictions or caps on coverage
• Incomplete coverage

49

• By 1960s, pressure began to mount again for a
  national solution
• Insurance companies recognized that they would
  never cover everyone
• Unemployed/unemployable
• Accepted that these people were legitimate
  responsibility of government

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• Saskatchewan (as usual) led the way
• Developments in this province started in 1920s
• Municipal doctors plans
• Union hospitals

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• Election of CCF government in 1944
• Leader, Tommy Douglas (1904-1986), committed to
  medical insurance

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• What does this man have to do with our Greatest
  Canadian?

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• Discontent with the inequities between the
  provinces
• Canada is like an old cow. The West feeds it.
  Ontario and Quebec milk it. And you can well
  imagine what it's doing in the Maritimes.

54

• Douglass 1st act was to guarantee medical
  coverage to destitute
• Established survey of provinces health
  conditions
• Headed by Henry Sigerist (1917-1957)
• Physician medical historian at Johns Hopkins
  University

55

• Recommended expansion of provincial health
  programs
• Federal/provincial negotiations stalemated
• Saskatchewan decided to go it alone

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• Hospital Services Act (1946)
• 1st compulsory tax supported hospital insurance
  program in North America
• Created tremendous pressure on other provinces
  and federal government

57

• Hospital Insurance Diagnostic Act (1957)
• Federal legislation
• 50/50 cost sharing of hospital costs
• By 1961, all provinces had hospital insurance
  plans

58

• Medical fees still not covered
• Saskatchewan again led the way
• CCF won 1960 election on promise it would create
  tax funded medical insurance
• SMA/CMA opposed this measure

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• Saskatchewan Medical Insurance Bill passed
• To come into effect April 1, 1962 physician
  opposition pushed date back to July 1, 1962
• Precipitated most famous physician strike in
  Canada

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• Withdrew all medical services (not just to the
  poor)
• Supported by other physician groups across the
  continent
• Seemed to ignore political will of the people

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• SK government recruited foreign physicians to
  substitute
• Furious public relations campaign on both sides
  of the issue
• Anti-medicare lobby led by coalition of Liberal
  supported

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• Organized mass rally where 30,000 40,000 were
  predicted to attend
• On July 11, only 5000 showed up
• Clear that the strike was over
• Public opinion clearly favoured medical insurance

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• Ironically the plan worked well for physicians
• Guaranteed payment for services rendered
• Within 1 year, SK physicians were highest paid in
  Canada

64

• Created tremendous pressure on federal government
• Royal Commission on Health Services (Hall
  Commission)
• Established 1961, reported 1964

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• Endorsed national health insurance
• Five principles
• Comprehensive
• Universal
• Portable
• Publicly funded
• Publicly administered

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• Medical Care Act passed in 1966 by Liberal
  minority government under Lester Pearson
• Implementation was very difficult
• Start date changed from July 1, 1967 July 1,
  1968

67

• Initially, only 2 provinces qualified under the
  plan
• By 1972, all 10 provinces and 2 territories were
  participating
• Short-lived physician strike in Quebec (1970)

68

• This program was never a sure thing
• Powerful Liberals opposed it
• Created during an era of unusual prosperity
• Impact on physicians
• Incomes increased 31 relative to increases
  attained by other Canadians

69

• Many bumps along the road since then
• Extra billing
• Threat of user fees
• Decrease in federal funding
• Globalization
• WTO