the Consultative Council for National Health Insurance (Ap proved Societies' Work), and three elected by the Scottish Association of Insurance Committees, who were to hold office until 31st March, 1927, or such later date as might by Order be determined.

It was decided that the administration expenses of the Com. mittee should be defrayed as extraordinary expenditure in connection with the administration of medical benefit, and regulations were made under which payments approved by us could be met from the residue of the sums unclaimed in the Stamp Sales Account for Scotland, to the limit of a sum representing 1d. for every insured person entitled to medical benefit during the year 1926. On the representations of the Committee, it was agreed that they should make small monetary allowances to the Approved Societies and Insurance Committees in respect of additional work falling on them in connection with the maintenance of the Index Register.

The Committee obtained an office in Wishaw, and were in a position to begin the actual operations under their scheme of procedure in May.

The method they have followed is, subject to certain modifications, that of the test scheme outlined in a former Report. It goes beyond the test, however, because, concurrently with the elimination of index slips relating to persons whose title to medical benefit has ceased, errors in the Index Register are corrected and deficiencies made good. In addition the Committee keep a récord not only of every person entitled to medical benefit, but of the Insurance Committee by which the index slip representing each person is held. This record they maintain by requiring all Approved Societies whose index slips have come under review to send to them direct all intimations affecting the title of their members to medical benefit, and by requiring all Insurance Committees to pass through their office index slips which have to be transferred to other Committees.

By the end of the year 93 Approved Societies had intimated the result of the comparison made against their membership registers, and there had passed under the review of the Index Clearance Committee over 721,000 slips, approximately one-third of the Index Register. In this portion of the Register there were found the names of 61,696 persons, approximately 8 per cent., who were not entitled to medical benefit. The position which the figures disclose seems to have justified the plea for a complete overhaul of the machinery of the Register.

We have refrained from asking the Index Clearance Committee for a formal report on their year's work, having regarded it as of importance that the operations on which they are engaged should not be delayed by the preparation of statistics which, while of interest, would have reference only to a third of the undertaking and from which no conclusions affecting the whole could properly be formed. We are satisfied that the duties of the Committee are being carried out satisfactorily, and that the

expenditure which has so far been incurred by them in administering the scheme is well within the proportion of the sum made available for the period.

While the necessary alterations in their registers were effected by the Insurance Committees as the work of clearance proceeded, no actual deductions from the names on doctors' lists were made until the close of the year. By so deferring alterations until each list had been effected by the operations over a series of Societies, the Insurance Committees were able to avoid the considerable fluctuations in the quarterly payments to individual doctors which otherwise would have taken place.

The table printed as Appendix XIV shews the mean number of index slips, counted at the commencement of each quarter, in possession of each Insurance Committee. The aggregate of 2,139,296 shews an increase of 16,796 on the previous year.

5. Medical Service.-The general terms of medical service for insured persons entitled to medical benefit continued without material change, but during the year negotiations took place on different occasions with representatives of the medical profession in regard to possible alterations, and representatives of the Department met the Scottish Association of Insurance Committees for discussion of certain projected amendments in the terms of service for practitioners. In the main the amendments were of a relatively minor character.

6. Distribution of Funds.-The Central Practitioners' Fund was constituted in the first instance on the basis of the Government Actuary's provisional estimate that a payment of 1,690,000 full capitation fees would properly cover the liability on insurance practitioners as regards the treatment of insured persons in 1926. The capitation fee remained at the sum of 9s.

The same basic number was used in constituting the Central Drug Fund, the rate for the year being determined at 1s. 10d. per insured person. In accordance with the recommendations of the Advisory Distribution Committee, these funds were distributed to Insurance Committees on the basis of the mean of the Index Register counts of the different areas during the preceding year, subject to a special adjustment, involving the sum of £5,000, in the amounts credited to Committees to enable them to meet their varying liabilities in respect of the treatment of temporary residents. These liabilities were gauged from returns received from Committees shewing the incidence of temporary resident treatment in the preceding year. On receipt of the Government Actuary's final estimate that the payment properly due to practitioners for the year should be 1,750,000 capitation fees for 1926, we decided to determine the medical pool accordingly, and arranged for the issue to Insurance Committees of credits in respect of the increased liability indicated.

In a few cases we had to explain to practitioners who felt that they were not receiving remuneration at the rate agreed

upon, the circumstances conducing to the lower figure of which they complained.

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An unfortunate misinterpretation, by the Panel Committee and Insurance Committee of a certain area, of the terms of the Distribution Scheme relating to payment for emergency treatment caused an appeal to be made by the practitioner concerned, whose contention we felt bound to support.

7. Range of Service Questions.-Thirty-two cases have arisen of formal questions under the Medical Benefit Regulations with reference to services rendered by insurance practitioners to insured persons. In only one of these did the local Medical Committee and the Insurance Committee take the view that the service, for which a fee was alleged to be claimable, was within the scope of an insurance practitioner's contract with his Insurance Committee; in all the other cases the local bodies concurredin finding that the treatment rendered was of such a nature as to involve the application of special skill and experience of a degree or kind which general practitioners as a class could not reasonably be expected to possess. After due consideration the conclusion of the local committees was agreed to in each case.

8. Special Payments for Anæsthetist Services.-For the guidance of Insurance Committees and Panel Committees in considering claims for payment due in connection with anæsthetic work we issued a model form of claim, and also, without prejudice to consideration of any particular cases that might be submitted, a statement prepared by the British Medical Association indicating generally the circumstances under which claims for fees might arise. The obligation on practitioners to administer anaesthetics in connection with any operations performed on persons oh their lists is not absolute, cases for which the administration of the anesthetic calls for services of a specialist" kind being excluded. From one centre only, a small town in which there is a hospital, have insurance practitioners who anesthetised their patients claimed a right to accept fees in respect that the administration was outwith the scope of their obligations. After local investigation it was agreed to admit the claims as specialist services in respect of certain cases only.

9. Forged Certificates of Incapacity.-Following on a serious case that came to light during the year of the improper use by an insured person of books of medical certificate forms purloined from the surgery of an insurance practitioner, it was arranged that a warning notice should be printed and inserted in all books of certificate forms before issue to practitioners, so that their particular attention might be drawn to the need for the careful custody of such forms.

10. Additional Benefits Certification. Several Approved Societies enquired whether insurance practitioners might competently charge a fee for issuing medical certificates required by insured persons for the purpose of additional benefits. We

have stated that a practitioner is on request to make a recom mendation in writing if ophthalmic treatment is required, or to include in his next certificate of incapacity a statement of any form of special treatment he has advised his patient to obtain: Otherwise a certificate for claiming additional benefit is not among those that a practitioner is required to provide free, but any charge made is to be included in the cost of providing the additional benefit.

11. Removal from Insurance Medical List.-In only one case has it been necessary to consider representations submitted for the removal of an insurance practitioner from the medical list. The case that arose was one of repeated and flagrant failure to furnish medical records in respect of insured patients, and failure to furnish replies to inquiries from the Insurance Committee; improper use of the official drug prescription forms was also involved. After due inquiry in terms of the Regulations it was decided that the name of the practitioner should be removed from the medical list.

12. Complaints against Medical Practitioners.-Insurance Committees have reported during the year other sixteen cases of complaints against practitioners under the Medical Benefit Regulations. These complaints were lodged by insured persons or Approved Societies. It is satisfactory to record that only two of the complaints were in respect of alleged neglect by the practitioner to render proper medical attendance and treatment to the patient, and in both cases the charge, on investigation, was found not to be substantiated. The remaining fourteen cases were concerned with breaches of the Medical Certification Rules, except in one instance where the allegation was that the practitioner had charged fees to an insured person. This last case, on the Insurance Committee's decision to fine the doctor for breach of his terms of service, became the subject of an appeal, which had not been disposed of at the close of the year. One of the certification complaints was withdrawn, and in the other twelve the local committees found the charges proved. In these instances the Insurance Committees 'decided to mark the gravity of the case by a warning, or, more generally, a fine. Four of these cases were still under consideration at the end of the year, and in five others, in which the practitioners concerned lodged formal appeals against the decisions, the decisions of the Insurance Committees were sustained after a formal hearing, where it was necessary. In the remaining three cases in which no appeal was intimated we concurred in the local recommendations that fines ranging from £3, 3s. to £7 should be imposed on the practitioners by deduction of the necessary amounts from the remuneration otherwise due to them...

13. Appeals under the Medical Benefit Regulations.-Three appeals were presented by medical practitioners against the decision of Insurance Committees to surcharge them in respect of excessive prescribing, Each of the appeals was dismissed.

Appeals were presented by two Approved Societies against decisions of two Insurance Committees in complaints by the respective Societies that two insurance practitioners had not complied with the Medical Certification Rules. One appeal was allowed and the other was dismissed.

Four appeals were presented by medical practitioners against the decisions of Insurance Committees finding that the appellants were in breach of their terms of service. The appeals were dismissed.

14. Drugs and Appliances: (a) Central Drug Fund.-On the position disclosed with reference to expenditure on drugs and appliances for insured persons during 1924 and 1925, and having regard to the liability provisionally estimated by the Government Actuary for 1926, it was determined to make available a Central Drug Fund at the same rate as for 1925, viz. 1s. 10d. per insured person. It was also determined that one-fifth of the Fund should be carried to the Special Drug Fund available for meeting deficits in the Drug Funds of Committees generally, the remaining four-fifths being credited to Insurance Committees in proportion to the number of insured persons in their area.

(b) Dispensing Doctors.-Only about one-sixteenth of the expenditure from the Central Drug Fund is required to remunerate those rural practitioners who contract to supply drugs and appliances to insured persons. In all cases these doctors. have chosen to be paid, as in former years, on a capitation basis, the rate being based on the average amount per insured person expended on drugs and appliances obtained from chemists in the area in 1925, exclusive of payments in respect of insulin. In addition to the capitation payments, dispensing doctors were relieved of any expenditure incurred in the provision of insulin, and of hypodermic syringes and parts thereof for the selfadministration of insulin in the treatment of insured persons suffering from diabetes. The capitation rate, being based on the average for the area, varied as between different parts of the country, ranging in all cases but one from 1s. 3d. to 2s. 41d., and in that exceptional area (a small one) was as high as 3s. 8d.

(c) Drug costs and Expenditure. The prices of drugs and dressings continued to fall during the year, and were on the average appreciably lower than during the preceding three years. The expenditure on drugs and appliances supplied to insured persons did not, however, fall to any extent below the level of the years 1924 and 1925, and was thus considerably above the annual expenditure previously ruling. The following table gives a comparison with the preceding four years :