Demand for health benefits is on the rise – but that’s meant that group Private Medical Insurance (PMI) prices are on the rise too. Many businesses are looking for alternatives – but what ARE the other options out there?
1. Doing nothing
Doing nothing on the health benefits front is always an option for businesses, but it could be putting them at a competitive disadvantage…
The Association of British Insurers (ABI) estimate that the number of employees benefitting from health insurance increased by 8% to 4.4 million in 20221. The Aon benefits trends survey suggests that 88%2 of businesses increased their emphasis on health and wellbeing in 2022, 95% acknowledged responsibility for their employee’s health and wellbeing, 15% wanted to expand private medical cover, and 47% are reviewing what they offer vs what is out there every year.
Meanwhile, the Mercer March Benefits report3 found that more benefits mean employees are more likely to stay put – 70% would stay at a company offering 10+ benefits vs 22% at a company offering 0 benefits.
So NOT investing in employee health could mean not retaining or attracting top talent and could even put businesses out of step with their industry peers.
2. Waiting on the NHS
Relying on the NHS to treat employees is the default from doing nothing. But there’s also a price to pay here in terms of sickness absence and performance.
There’s no denying that lengthening waiting lists4 are resulting in significant delays in both diagnosis and treatment. While the NHS is still extremely effective in dealing with sudden or serious conditions, but every day or minor ailments, which we know are behind 29.3% of absences5, and other non-urgent interventions – eg ‘elective’ surgeries like knee replacements - are becoming harder to access.
As an example in terms of numbers 28%6 of patients report a poor experience in booking a GP appointment - with 24%6 waiting a week or more to see someone, and some up to 28 days7 Meanwhile, people get an appointment with Equipsme’s 24/7 GP within an average of 2 days, without waiting on the phone at 8am when lines open - and at a time to suit their schedule.
Meanwhile there are 300,0008 people currently waiting for NHS treatment for musculoskeletal health issues (responsible for 10.5%9 of absences), while 98% of Equipsme members were offered an online physio appointment within one working day10.
And when it comes to private diagnosis and treatment, our partners AXA Health aim to get people to a consultant within 4 weeks, vs a target of 18 weeks11 for non-urgent issues on the NHS - which is often being missed12, and is dependent on where you are in the country.
In short, can many businesses afford to have employees who are out of action for longer, and/or risking their condition worsening before they can find support for it?
3. Self-pay
Recent research indicates that 1 in 8 people13 are turning to self-pay options to get the medical attention they need - but that isn’t an option that’s open to the vast majority of Brits.
The cost-of-living crisis has meant that 40% of people14 are currently finding affording their rent or mortgage payments very or somewhat difficult, and 29% of adults15 can’t afford an unexpected but necessary expense of £850.
With typical non-urgent operations often cost thousands of pounds, that puts them well out of reach for most people. As an indication, goprivate.com16 estimates a hip replacement would cost someone £12,402, a knee replacement £13,103, an MRI scan £537, and cataract surgery £2,709.
4. Low-cost cash plans
For businesses with budgetary restrictions, cash plans can often be attractive as a way to deliver a health benefit that works for more or all of the workforce. But these can also have pitfalls.
There can be strict caps and limits on the conditions covered and interventions on offer, as well as how much can be claimed in a given period. Some are even ‘discretionary’ – which means employees can’t always be sure their claim will be successful. Again, many won’t have the money to pay out up front from their own pocket, even if claim turn-around times are guaranteed to be swift.
Other healthcare or cash plan pitfalls can include long lead-in times before cover kicks in, or key exclusions, like diagnosis cover. In short, businesses should always read the small print so they know exactly what they’re getting.
5. Traditional PMI
Traditional PMI is expensive, and where it IS an option it’s often only viable for a small number of employees, usually the top tier of senior management. In our experience, prices per employee for traditional company health insurance plans can vary enormously. Depending on employee ages, UK location and level of cover, very broadly – businesses can expect to pay anywhere from £25 to £250 per employee per month.
Rates can also be competitively priced for new business and then rise in later years so over time, the price per employee can be significantly higher than when the policy started.
6. The Middle Ground
At Equipsme, we’re unique because we take up the middle ground between cash plans and PMI.
We offer practical health benefits - up to and including diagnosis and treatment through our partners at AXA Health – at cost effective and transparent prices. So businesses can know their people are in safe hands - and know exactly what they’re getting into.
We also have great add-ons in our stress support line, dental and optical cover (which can help support everyday health costs like a cash plan), and we’re the only provider that lets employees pay in separately themselves to upgrade or add their partner and children rather than putting the admin hassle of salary deduction on the employer.
Find out more about our plans here.
Sources:
- www.abi.org.uk
- www.aon.com
- www.mercer.com
- www.bma.org.uk
- www.ons.gov.uk
- www.nuffieldtrust.org.uk
- www.nuffieldtrust.org.uk
- www.csp.org.uk
- www.ons.gov.uk
- www.axahealth.co.uk
- www.nhs.uk
- www.england.nhs.uk
- www.theguardian.com
- www.ons.gov.uk
- www.ons.gov.uk
- www.privatehealth.co.uk
All our information is desk-based research from credible sources only, including the NHS and medical/disease charities.
Date created: June 2024
