In the current climate there is considerable turmoil in the UK private medical insurance (PMI) market caused by the COVID-19 crisis.
The situation is changing daily as insurers develop their response to the events presented to them. These include:
- Having to close their central offices and make arrangements for staff working from home
- Certain key functions (e.g. underwriting/ pricing/claims handling) being unstaffed because of illness, which is resulting in ‘bottlenecks’ in processing and handling calls/enquiries
- The Government’s deal with private hospitals, which has reduced private treatment capacity dramatically
Elective surgery via private facilities will now be subject to indefinite delays while the NHS effectively commandeers private hospitals to fight the COVID-19 situation.
Obviously, businesses purchase PMI to give employees the option to arrange private treatment and this facility is greatly curtailed by the current situation. Some businesses may be considering the relative value of PMI, but they should hold their nerve and remember:
- These are extraordinary times and no one could have foreseen what COVID-19 would mean for private hospitals/PMI
- Although hospital treatments may be subject to delay, PMI companies have rapidly adapted their offering to enhance the benefits they are still able to provide:
- Advice to deal with musculoskeletal (MSK) (MSK are the leading cause of working days lost in the UK at an estimated 31 million days per year ¹)
- Consultations (probably telephonic where clinically appropriate)
- Mental health support (30% of the UK workforce have had a formal diagnosis of a mental health condition during their lifetime and 39% have experienced mental health symptoms related to their work in the last 12 months ²)
- NHS cash benefits (all insurers have now confirmed this is payable if members are hospitalised with COVID-19)
- Virtual GP services
- Employee assistance helplines, health helplines and digital information
- GP provided minor surgery
- Dental and optical cash benefits
Businesses may suggest that cancelling their cover in light of the lack of treatment is an option – obviously it is but they should also consider:
- The benefit may be contractual, so cancellation will need consultation with employees
- Underwriting – cancelling the contract could mean that members lose their underwriting status and may have new exclusions if cover is subsequently re-established
- Employees need as much support as possible in the current environment – cancelling PMI sends a very negative message and will remove valuable remote mental health support, especially for those self-isolating
- Some PMI policies include travel cover – cancelling PMI may mean that employees can’t claim for lost holidays. Note: new travel policies issued after 15 March are likely to have cancellation exclusions due to COVID-19
Insurers are not ignorant of the fact that many businesses are struggling with revenue and cash flow due to the COVID-19 crisis; insurers are looking to be as flexible as possible. If clients are struggling to pay premiums, they are willing to look at pausing premiums, extending terms, etc. on a case-by-case basis.
Each insurer will have their own approach, but above all they are trying to accommodate requests for help as much as possible. The best advice is not to jump to knee-jerk decisions as insurers are looking at providing workable solutions. Talk to your Employee Benefits Consultant – they will help your business navigate through this difficult situation.
¹ https://www.bitc.org.uk/wp-content/uploads/2019/10/bitc-wellbeing-toolkit-musculoskeletal-mar2017.pdf
² https://www.bitc.org.uk/wp-content/uploads/2019/10/bitc-wellbeing-report-mhawmentalhealthworkfullreport2019-sept2019-2.pdf
