MEMORANDUM.

AN EXAMINATION OF CERTAIN FEATURES OF THE SICKNESS AND DISABLEMENT CLAIMS OF THE SELECTED SOCIETIES IN THE YEARS 1921-23.

1. The records of the sickness and disablement claims of the "Selected Societies were sufficiently complete in detail to enable the investigation to include enquiries as to the proportion of members claiming benefit of each kind in each year at the various age groups, with the related average duration of claim. Statistics were also obtainable as to the working of the three days' waiting period and as to the extent to which the claims for disablement benefit represented other than permanent incapacity. The information thus secured is believed to be both of interest and of importance to those engaged in the administration of sickness risks as well as to actuaries who are called upon to deal with the financial aspect of these risks, and it is accordingly presented in Tables I, II and III appended to this memorandum. These tables relate, respectively, to the experience of men, unmarried women (spinsters and widows) and married

women.

2. It was desired to compare the new experience with earlier (friendly society) experience in regard to some of the points covered by these tables, but this was only possible in the case of men, since women were not insured against sickness to any material extent before the institution of National Health Insurance and no women's sickness experience of any authority has previously been obtained. The features examined in paras. 3 to 9 below relate exclusively therefore to the experience of men and no corresponding investigation can be made in the case of women.

3. On examining Table I it was found that the sickness claims of men were relatively fewer than in the Manchester Unity Experience, but that the average duration of sickness and disablement was longer than in that experience. This feature has been further investigated and use has been made of the analysed table of the Manchester Unity Sickness Rates contained in p. 593 of the Report for 1912-13 on the Administration of National Health Insurance (Cd. 6907) to obtain approximations to the "proportion sick" in the "first six months" and "after six months periods respectively and to the proportions entering on the "after six months period which are necessary for a complete comparison of this standard experience with that of the Selected Societies.

4. The following table relates to sickness benefit (1st six months of sickness). The headings are self-explanatory.

5. After making due allowance for the fact that Col. (1) includes all claims, however short, while with few exceptions Col. (2) excludes cases that did not extend to at least four days, it is clear from Table 1 that in National Health Insurance there have been relatively many fewer claims than in the Manchester Unity Experience but that the duration has been more prolonged, especially at ages under 45. These results do not give us. any clear indication of what to expect in regard to the corresponding factors in the experience of disablement benefit. On the whole, since the differences between Cols. (2) and (1) are more marked than the differences between Cols. (4) and (3), it would perhaps be reasonable to look for a smaller proportion drawing disablement benefit in the case of the Selected Societies than in the case of the Manchester Unity, especially if the theory that the disablement benefit experience has not yet reached maturity is wellfounded. The facts obtained are shown in Table 2. It is necessary to explain in regard to this table that there are two factors as to the proportions receiving benefit which should be distinguished (a) the proportion completing sickness benefit and entering on disablement benefit during the year and (b) the full proportion in receipt of disablement benefit. This latter includes with (a) those on the disablement list at the beginning of the year and those who on first claiming during the year were only entitled to disablement benefit under the "linking-up" provision of the Act.*

6. It will be seen that up to age 40 the proportion reaching disablement benefit during the year in the Selected Societies was practically identical with the Manchester Unity Experience, although the proportion who had sickness benefit was very much smaller. This seems to throw up in strong relief the effect of "longer duration." The full proportion drawing disablement benefit is actually greater up to 40 than in the standard experience. This may be due to the existence of a greater proportion of "linked-up cases. If the greater average duration of sickness benefit is attributable in part to frequent claims from a small section of persons of inferior health at entry, a class which, owing to medical examination,

* Where a person has received sickness or disablement benefit and recovers, any subsequent incapacity is treated as a continuation of the previous incapacity unless a period of one year has elapsed. Otherwise the two attacks are "linked-up" and in such case if sickness benefit is payable at the beginning of the second attack the claimant is not subject to the waiting period of three days. This explains the difference between Cols. (2) and (3) in Tables I, II and III appended.

would certainly have been much smaller in the Manchester Unity Experience, it would necessarily have as its consequence more linking-up, and therefore more short attacks paid at the disablement rate. In the nature of the case this feature would be of less importance at ages over 40 than at the younger ages. The experience at ages over 40 appears, in fact, to confirm the corresponding experience in respect of sickness benefit.

7. The average duration of disablement claims within the year is shown, in weeks, by Table 3.

TABLE 3.

Average number of weeks of disablement benefit within the year.

8. The average duration within the year is, of course, substantially less than the total duration of disablement benefit, since cases of prolonged disablement may extend over several years. In consequence the differences in average duration of claim in the two experiences are somewhat masked in the figures shown above.

By making certain assumptions it is possible to calculate approximately the average total duration of disablement claims, and the resulting figures are shown, in weeks, in Table 4 below.

TABLE 4.

Average total duration of disablement claims stated in weeks.

9. As might be anticipated the figures confirm those of Table 3, and emphasise the striking differences between the Manchester Unity Experience and that of the Selected Societies.