At the start of this year there were 7.5 million people waiting for treatment on the NHS, this has led “a lot of employers to recognise that they can’t necessarily rely on the NHS for treatment” to support employee health.
This was the stark assessment of Steve Herbert, a senior consultant and co-host of Benefits Unboxed the podcast from Benefits Expert.
Speaking on the latest episode, titled ‘Can HR stop soaring private medical insurance (PMI) costs draining the benefits budget?’, Herbert emphasised that NHS waiting lists were a problem for the nation and UK employers.
“This is a challenge for employers because most employers, even those with PMI, are reliant to some degree on the NHS supporting the health and well being of their workers.”
Herbert calculated that 7.5 million people is the equivalent of the entire and combined populations of Birmingham, Brighton, Bristol, Coventry, Hull, Leeds, Leicester, Liverpool, Luton, Manchester, Milton, Keynes, Newcastle, Northampton, Norwich, Nottingham, Plymouth, Portsmouth, Reading, Sheffield, Southampton and Stoke on Trent, all simultaneously awaiting treatment.
Long NHS waiting lists are a major reason so many people are turning to PMI for care, but it’s also one of the reasons why costs are going up for employers, he said.
Research shows that PMI premiums have increased by 15 percent on average in recent years, but anecdotally, there are cases of it increasing by more than 100 percent.
A warning from health minister Wes Streeting that the NHS “could go the way of Woolies” if action is not taken came ahead of the government announcement that it plans to cut NHS waiting lists by brokering a partnership deal between the NHS and the independent health sector.
The deal is intended to help expand healthcare capacity and widen patient choice by enabling more treatments to be delivered through the independent sector, while care remains free at the point of use.
But this plan won’t reduce waiting lists immediately, and for employers facing rising cost pressures from every angle, ensuring their PMI premiums don’t gobble up their HR budget will be a top priority.
Practical steps to address PMI costs
Herbert said there are practical steps employers can take to mitigate the impact of PMI cost rises.
“What you need to be doing with PMI is trying to prevent people becoming a claim in the first place. Claims equal cost, which equals increased premiums, particularly for a large employer with a claims related scheme.
“If you can get upstream of the issues, if you can start helping people’s wellbeing before they get to being a claim that is better for them, as in the individual, that’s better for the individual’s family, and, of course, it’s better for the employer too.
“So, being upstream of the problems and trying to be preventative rather than relying on the claim just to be sorted out after the event.”
He said the easiest and cheapest way to “get upstream” is to get the communications around your benefits right. Employers need to tell employees what support they have in place, how to access it, and when to access it.
“If you don’t do that, then you’re essentially wasting your money.”
- For more tips on how HR can mitigate the impact of PMI cost rises, the reasons behind PMI premium hikes and current health and wellbeing trends, you can listen to the full podcast here.
- Check out the Benefits Expert Guide to Group Corporate Healthcare for more on what is available.
