Despite the description as a “national” health service (NHS), in practice the health system has never been the same across the four nations. This variation has increased with the transfer of powers for health care and public health to Northern Ireland, Scotland and Wales from 1997 onwards, in a process termed “devolution”. Scotland, Wales and Northern Ireland have pursued an approach emphasising partnership between purchasers and providers in the health system, while market forces play a greater role in the English health system.
The United Kingdom’s health care system was established in 1948 as a national system available to all residents, funded through taxation, provided using publicly owned hospitals and free at the point of use. The United Kingdom government allocates money for health care in England directly, and allocates block grants to Scotland, Wales and Northern Ireland which in turn decide their own policy for health care. Each nation funds organizations which arrange services on behalf of patients. In England and Northern Ireland there is a split between the purchasers and providers of services, which was introduced in 1990; this split has been abolished in Scotland and Wales. Throughout the United Kingdom (except in Northern Ireland) there is a division between health care (provided by the NHS) and social care, which is funded through local government and mostly provided privately.
England, Scotland, Wales and Northern Ireland each have their own advisory, planning and monitoring framework for their health care system. Unlike other European countries, devolution of health powers in the United Kingdom was not accompanied by a common data or monitoring system, and so comparisons between nations within the United Kingdom are not easy to make. A key body is the National Institute for Health and Care Excellence (NICE), which advises on the cost-effectiveness of interventions, though its guidance does not automatically mean funding for a recommended treatment is available. NICE is an executive non-departmental public body working with the English NHS, but its services are also used in varying ways in Scotland, Wales and Northern Ireland.
There is also a range of regulators for the health system; some regulators oversee all of the United Kingdom (such as health professional groups), and others are individual to one health system (such as quality of care providers).
The health system is mainly funded through general taxation, with the remainder coming from private medical insurance and out-of-pocket payments. Although in principle the NHS provides comprehensive health services, in practice coverage for specific services varies across the United Kingdom. Most services are provided free of charge at the point of use, but there are some that can involve cost-sharing (like dental care and pharmaceuticals) or direct payments (like most social care); only England has prescription drug charges.
Purchasing of health services varies. In England the Department of Health allocates funds to NHS England, which distributes funds using weighted capitation to general practitioner-led clinical commissioning groups as well as to specialist and primary care services. England also uses payment systems intended to create incentives for quality and efficiency, in particular the Payment by Results system for most hospital care (this uses a version of diagnosis-related groups to determine payments based on national average costs) and Pay for Performance linking a small proportion of provider income to certain goals. In Northern Ireland the Health and Social Care Board negotiates contracts with Health and Social Care trusts. Wales uses a capitation-based funding method, and local health boards manage the funds they use in delivering services. Boards and community health partnerships manage their own funds in Scotland and use a capitation-based allocation system.