Cover Image
close this bookThe Nutrition and Health Transition of Democratic Costa Rica (International Nutrition Foundation for Developing Countries - INFDC, 1995, 228 pages)
close this folder2. Development of the social security institute
View the document(introductory text...)
View the documentBackground
View the documentSocial security in Costa Rica
View the documentThe extension of direct insurance
View the documentExtension of insurance to the family
View the documentThe financial crisis
View the documentThe constitutional amendment
View the documentToward universalization
View the documentDevelopment of human resources
View the documentThe integration
View the documentThe new health care models
View the documentFinal comments

Background

The direction that human history had taken over many centuries radically changed toward the end of the eighteenth century Within the short span of 20 years, three events occurred that transformed man's way of life, placing him under new conditions that previously had only formed part of his dreams The first event was the introduction of the steam engine by James Watt in 1769, which led to the substitution of mechanization for labor and the opening of the process of industrialization The second event took place in 1776 when the thirteen North American colonies declared their independence from the British crown and established the first democratic model in which "government of the people, by the people, for the people" became a modern political system The third event took place in 1789, the initiation of the French Revolution, which marked not only the beginning of the end of the absolutist monarchy but also the beginning of a new government approach in which the government began to assume the responsibility of protecting the most vulnerable individuals and population groups in society.

These events are related to the social and economic conditions that determined the life-style of humans and that gradually generated individual and collective security and a better quality of life Nevertheless, in spite of this enormous progress, the problem of disease remained as intractable as before, without knowledge of its causes, evolution, and final outcome Therefore, the advances achieved in other fields did not significantly effect the burden of disease

The rapid population growth generated an excess of labor that was not needed by the process of industrialization The impoverishment of the workers that followed led to extreme poverty and increased morbidity The use of machines caused work-related accidents responsible for temporary or permanent disabilities. The process of territorial domination and the control of markets through military campaigns produced deaths, disabilities, widows, and orphans.

Meanwhile, a unique phenomenon, which would revolutionize political systems, arose in Germany, which at that time was the least democratic country in Europe. After the Franco-Prussian War of 1879, the economic conditions of the German population worsened. This forced Chancellor Bismarck and Kaiser Wilhelm I to search for measures that would attenuate the popular discontent that resulted from poverty, disease, and difficult working conditions. Bismarck elaborated and sent to Parliament a proposal for a law that would protect workers involved in occupational accidents through indemnification for health damages. He also sent a proposal for a law to protect workers against common illnesses by providing free medical care and an economic subsidy that would cover missed working days as a result of illness. This law covered pregnancy and delivery; pregnancy was equated with a disease because it had a predictable duration and a physiologically established recovery period. The concept of family benefits appeared much later.

Even though both laws arrived at parliament together, the law for Required Insurance for Occupational Accidents was approved one year later than the Illness and Maternity law, which was approved in 1883. This happened because of the detailed discussion of the former law by the unions. When the laws were presented, it was stated that the problem of the elderly and the disabled would be addressed later. In fact, a law approved in 1889 provided a retirement fund for workers who had had 30 years of experience and were 75 years of age or who, at any aye, had become disabled.

These three laws that covered the so-called nonmodifiable risks transformed the situation of the workers in the industrialized world. Their content was so important that it pushed the Catholic Church to attempt to regulate the relationship between labor and capitalism through an extraordinary encyclical document known as Rerum Novarum authored by Pope Leo XIII.

From then on, all the countries started working on their own legislation. The relevance of this issue was confirmed when the terms of the World War I amnesty were being drafted. They included the affiliation of all signatory countries to the Treaty of Versailles with a new organization to regulate the working conditions of European workers. This is the origin of the International Labor Organization (ILO) and social security was introduced by all the countries that became affiliated with ILO. During the Fifth Pan American Conference in Santiago, Chile in 1923 attended by Costa Rica, a recommendation was made "to establish social security in each country, mainly for accidents, illness, and disability."

ILO recommended that each country create a ministry in charge of the administration of social security and that a Labor Code be created on which to base labor regulations. Between 1920 and 1923, all Latin America complied with this recommendation. Costa Rica followed all of these recommendations, establishing in 1927 its Ministry of Health and Social Assistance, and approved its first sanitation code. In 1928 it established the Labor Ministry and promulgated a set of regulations that in 1942 would become the Labor Code.

This brief summary explains why social security has been directly linked with the mechanisms of production and the Labor Ministry. This became clearer with the introduction of regulations covering occupational accidents and retirement funds that were never under the control of the Ministry of Health.

World War II began in September 1939, and in six years it produced the most technological advances as well as sixty million deaths, the largest number of total casualties in any war. As the British said, it was a total war because not only soldiers but also civilians died when the cities were bombarded to destroy the defense industry. It was the impact of the war that led to proposals advocated by the social and political thinkers of Great Britain that were universal rather than group specific.

The crisis of World War II produced at least four major changes that transformed societies worldwide in a short period of time:

· The technological advances achieved provided individuals with a variety of goods that improved the quality of their lives, the economy, communications, and education.

· The social value of the citizen increased because the political mechanisms for better land distribution and social equity strengthened the majority, which translated into political actions that had a strong democratic effect.

· The conceptualization, formulation, and implementation of structural reforms of the governments and their regulatory role for society.

· The political organization of the countries created instruments for the search for universality and solidarity, closing the wide gaps that the different stages of development generated.

The document known as the Beveridge Report was published in the middle of the war when the British began to feel victory at hand. For its social and economic effects, this document can be compared with those that produced the three German laws of social security or the political content of the Treaty of Versailles.

The Beveridge Report contains five important concepts that were developed at different speeds in different parts of the world:

· Social security can be modeled in a way that covers all the population with its programs.

· A stronger economy, increased efficiency, and improved social equity can be achieved when the social security funds are united.

· Health care can be a right of all citizens.

· The best solution to unemployment is an active labor market.

· A minimum national wage should be established to strengthen wage policy.

Based on these fundamental premises and the political consequences of World War II, the concept of social security was established as universal, pro-solidarity, equitable, just, and unifying, in order to counteract the unequal benefit to various social groups resulting from laissez-faire capitalistic concepts. The two immediate consequences were the creation of the National Health Service in Great Britain as a way to protect all the population and the Letter of Human Rights with the organization of the United Nations in San Francisco, which established, in Articles 22 and 25, the right of all citizens to access to social security and health, respectively. Both events occurred after the end of the war in 1945.

From then on, changes were implemented gradually. As part of a new structure, the World Health Organization (WHO) emerged as the technical and political organism that establishes the world standards that all countries should follow to improve health indicators. In 1976, the WHO assembly proposed the goal of "Health for All by the Year 2000," which was a programmatic proposal based on the democratic and equitable concept that perceives health as an individual and universal benefit. Two years later, in 1978, health goals were established with specific indicators, and primary health care was proposed as the strategy of choice to achieve them. The social and political progress that has occurred during the last four decades in almost all European countries has placed social security as a development priority that supports the principles of equity and social solidarity proposed in the Beveridge Report.

The countries of the Western Hemisphere have not progressed in the same way. There, the union movement began early, even though the process of industrialization nowhere reached the levels found in Europe. The United States orientation was to allow private health insurance with no relation to the government. This made health care a competitive market where the pressures to increase consumption always have the edge over the economy of use by consumers. Canada adopted the British system.

Although Chile was the first Latin American country that approved a system of Required Workers Insurance, it collapsed because this country was unable to merge this system with those of smaller health care providers. Nevertheless, Chile had the advantage of creating its National Health Service in 1953, which worked very efficiently until political turmoil broke it apart to establish private services that after several years did not cover more than the 21% of the population that was able to pay their fees.

The brutal economic recession in Argentina and Uruguay severely hurt a multi- institution system that was brought from nineteenth-century Europe by immigrants. In the rest of the countries, the social security institutions have had only limited development. Almost all of them were initiated between 1930 and 1950 and, following Bismarck's model, have been unable to cover more than 20% of the total population. Family coverage is still very limited, and participation in integrated health programs is almost unknown and it continues to be rare for the Ministries of Health to share responsibility for health care.