Private medical insurance: Do you need protection?
Wednesday, 20 August 2008 12:00
Despite increased investment in the National Health Service, there are still enough complaints about the system to keep the demand for private health insurance healthy.
But what is typically covered by these policies, and are they value for money? Sarah Routledge looks into private medical insurance.
Superbugs, including MRSA and C.difficile, top the list of reasons consumers gave Bupa for choosing private healthcare despite our free health service.
Other important concerns are the long waiting lists and the lack of choice the system can offer, as well as the improved comfort associated with a private hospital.
Recent headlines about expensive drugs that could have significant benefits for patients but are unaffordable for the NHS are also spurring consumers to 'top up' their healthcare allowance with private insurance cover.
All these issues are clearly important to consumers, as demand for private medical insurance (PMI) is on the rise.
According to market analyst Laing & Buisson, the number of people with PMI policies in the UK or enrolled in medical schemes by employers, rose by 1.3 per cent in 2007 to reach 4,250,000 at the start of 2008.
Although some employers will offer PMI as part of a benefits package, many will not have this advantage but are still keen to buy their own policy.
What is covered?
PMI is designed to treat short-term, treatable illnesses or injury, or 'acute' conditions. Long-term illnesses, or 'chronic' conditions, are left to the NHS.
It is really for times when your illness is considered 'non-urgent' and therefore has long waiting times - although there are conditions which are considered urgent but still come with long waiting times on the NHS and private healthcare can ensure swift treatment in these cases.
Some policies also include complementary medicines or physiotherapy.
With insurance, the list of what is not covered is generally longer and it is important you understand what these exclusions are. Pre-existing conditions, dangerous hobbies and elective treatments are generally not covered.
However, insurance companies are as likely to compete on benefits of their policies as on price, so shopping around could reveal a whole host of unexpected advantages.
Ultimately, the benefit of having private insurance is choice, according to Bupa.
"Private medical insurance is appropriate for people looking for more choice, control and peace of mind in relation to their health and treatment.
"Bupa members will have prompt access to recognised expert consultants from initial consultation and any necessary diagnostic tests through to treatment and follow-up. Members are treated in clean, comfortable hospitals with their own private room with extensive visiting hours and in-room facilities," a spokesperson says.
In recent years, the industry has come up with a whole range of policies to suit all kinds of budgets - this is one reason why uptake has increased, Ben Faulkner from Axa PPP believes.
"Providers are working hard to stimulate interest and create fresh appeal amongst consumers," Mr Faulkner says.
"For example, in June we launched a £9.99 a month private medical insurance plan exclusively for children called First Healthcare. We designed it to offer reassurance to parents at an affordable price."
Axa also has a plan for the self-employed, which features a personal messaging service that allows them to stay in touch with their business when they are off sick, as well as a low-cost policy for the over 55s.
Choice is an important factor in PMI, Standard Life believes.
"A year ago, we launched a new product for small businesses that offers a menu of choice. Typically, PMI offers a list of benefits, some of which you won't need, but our product allows the customer to pick and choose from a menu," says spokesperson Paul Lynes.
Service is also vital and Mr Lynes adds Standard Life is one of the few companies that will pay your medical bills in full without any quibbles.
How can I get my premium down?
There are several ways of cutting costs, according to Mr Faulkner. "For example, you can buy a policy that will pay out for hospital care but not out-patient care, or you can buy one that only covers specific conditions.
"There are also policies that will pay out only if you cannot get treatment on the NHS within six weeks."
And like many other policies, it is usually possible to agree to pay an excess in the event of a claim - the higher the excess, the cheaper the premiums will be.
It is also possible to choose a policy that will treat a specific type of illness, which will offer less cover than a comprehensive policy but will be cheaper.
If you are willing to restrict yourself to a shorter list of hospitals, you can also save yourself some money.
Value for money?
Private healthcare will not cover all health eventualities. You will still need the NHS for any pre-existing medical conditions; chronic illnesses such as diabetes; emergencies and pregnancy, as well as a whole host of other exclusions.
In addition, the actual care will not be any better than on the NHS. The doctors who treat patients privately are almost always NHS doctors, while the treatment will also, with a few exceptions, be the same.
What you do get is better food in your own room, a consultant you can see within days, a clean hospital and surgery scheduled to suit you. Whether this is worth the premiums is up to you.
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