As you are probably already aware, the majority of UK residents receive their health care from the National Health Service (NHS). For routine care, there are usually no charges at the provider level, although people do incur out-of-pocket expenses for prescriptions, dental exams, and so on.
For some people, the service provided by the NHS is less than what they desire so they supplement it through private healthcare. Doing so in a way that is affordable often requires purchasing health insurance or utilising cover paid for by an employer. Paying for private healthcare via cash is not an option for most Brits.
The Need for Health Insurance
The National Health Act of 1946 is considered one of the most important government actions taken on behalf of UK citizens in the 20th century. It established the National Health Service which officially "opened for business" in 1948. The idea of the Act was to ensure that all UK citizens, regardless of age, sex, or physical health, could receive adequate health care whenever it was needed.
Unfortunately, the grand and lofty plans laid down in 1946 were not as cost-effective and efficient as the leaders of the day had envisioned. As good as the UK system is, there are still plenty of citizens who prefer to top up with private care or use private care entirely. When private care is chosen, one of the methods of paying for it is through private health insurance.
The interesting thing to note about private care in the UK is that the list of services provided is quite a bit smaller than what is offered by the NHS. Furthermore, the NHS occasionally contracts with private healthcare providers to fill in some of the gaps created by staffing shortages and other circumstances. The two groups of providers have managed to learn to coexist and work together to provide for the nation's health care needs.
What Private Health Insurance Covers
The two most common questions surrounding health insurance in the UK are, "What does health insurance cover?" and "How much does it cost?" Unfortunately, there are no hard and fast answers to either question. And as the NHS is the main healthcare provider while private providers fill in the gaps, health insurance in this country is highly specialized.
As an example, if you visit the Private Healthcare website and read their health insurance guide, you will quickly discover that there are hundreds of policy options consumers can choose from. Here are just a few to show you how complex the issue is:
- Package Cover - When you choose package cover, you are agreeing to a predetermined amount of cover and benefits that will not change. In most cases, you will be paying for cover you probably do not need in order to get things you do need. Package cover typically includes things like hospitalisation, diagnostic tests, physiotherapy, and chemotherapy.
- Limited Cover - A limited cover policy allows you to select among different types of illnesses and conditions you want to be covered for. Obviously, if you need treatment for something not included under your policy you will need either to get your treatment from the NHS, or pay a private caregiver out-of-pocket. Limited cover is an option for those who want private health insurance on a tight budget.
- Shared Cover - The shared cover product is a hybrid of the previous two. Its signature feature is a requirement that the patient pay for certain percentage of his medical care out-of-pocket. Depending on the care and procedures utilised that could be between 25% and 75% of the total bill.
Other types of cover you could purchase include special cover plans, convalescent care, major medical expense cover, accident plans, sports injury plans, and membership plans. Suffice it to say; figuring out what you want and need probably will require quite a bit of research on your part.
Reasons for Purchasing Private Health Insurance
If you rely on the NHS for your healthcare and your employer doesn't provide private health insurance, is there any real reason for you to purchase insurance on your own? Actually, there are several good reasons. We will start with the principle of "major medical expenses."
Suppose you are a resident of England requiring 12 months of treatment for a serious condition. If that condition requires extensive hospital treatments, you might be unhappy with the level of comfort provided in a general NHS ward. With private health insurance you can be admitted to a more comfortable and relaxing private ward.
Private health insurance may also be something to look into if you are travelling abroad. Not everyone will need private insurance during their travels, as the NHS covers some as long as they remain within Europe, but others will require extra cover. Individuals would have to check with the NHS about their eligibility for cover abroad.
Lastly, if you like the freedom of choosing when and where to access healthcare you may find private caregivers to be more to your liking. Private caregivers are "customer oriented" and are therefore prone to giving more personalized service as often as possible. Shorter queues for non-life-threatening conditions are just one example of the customer-oriented approach.
What to Think about before You Purchase
If you are considering purchasing health insurance, the first thing to think about is why. In other words, if you have a pre-existing medical condition you suspect will become a significant problem in the future health insurance may be attractive to you. However, keep in mind private health insurance comes with limitations, not the least of which is exclusions for some pre-existing conditions.
Other things to consider before you purchase include:
- how much you can afford to spend
- whether or not you're willing to contribute out-of-pocket
- whether or not you want to include or exclude specific types of care
- whether or not specific hospitals are important to you
- whether or not you want to include coverage for diagnostic testing and other specialized services
As discussed previously, you have the option of choosing a package program or going with more specialized coverage. Nevertheless, in order to make that choice you must know beforehand what it is you are trying to accomplish. This might be a good topic of discussion for you to bring up with your insurance or financial advisor.
Divulging Your Medical History
According to This Is Money, you may not necessarily have to divulge your medical history in order to get health insurance. However, if you do, make sure to be thorough and accurate when filling out all forms. In all likelihood, your insurance company will contact your doctors to make sure the information you provided is accurate.
If you are not required to divulge your medical history, there may still be some limitations in terms of pre-existing conditions and what will, or will not, be covered. For example, if your medical records indicate you suffered from a condition in the past that is likely to flare up again in the future, it may be excluded from your private cover. All of these things are different from one provider to the next; you will have to ask for details when you shop around for policies.
Ways to Keep the Cost of Health Insurance Down
Health insurance in the UK is similar to other insurance products in regards to keeping costs down. Insurance providers offer a variety of incentives as a means of helping you financially while reducing their risk. Here are some examples:
- Choosing Higher Excesses - When you choose higher excess amounts (known as "deductibles" in some circles), you are rewarded with a lower monthly premium. The excess is the amount of money you pay toward satisfying a medical claim before your insurance provider picks up the rest. The higher the excess, the less risk insurance companies take, and the lower your monthly premium.
- Agree to Waiting Periods - Some health insurance plans will offer reduced rates on routine services if you are willing to accept waiting periods. As an example, you might accept a six-week wait in order to see a GP for specific condition. If the NHS can book you within that six-week period, you would see your regular doctor. If that were not possible, the insurance provider would book you an appointment with a private care provider as soon as possible.
- No Claim Discount - Just like car insurance, you can take advantage of no claim discounts with your health insurance. If you go a certain amount of time without making a claim, you get a reduced premium at your next renewal. After so many years of no claims, you could be saving a significant amount of money. However, it is only beneficial if your reason for purchasing health insurance is to use it is a rare supplement.
Statistics show that health insurance is growing in popularity in the UK. It seems that most of the new policies are being provided by employers as benefits to their workers. Nonetheless, as the number of people using health insurance continues to rise, it is having a very definitive effect on how healthcare is delivered in the UK. You should look at the possibility of health insurance for your situation. It might end up being something beneficial to you.
If you are ready to start shopping for health insurance, you might try going directly to a few brokers or underwriters. You might find these links especially helpful:
Bupa - As one of the UK's leading companies in terms of customer service, Bupa is proud offer UK residents several different types of insurance products including health insurance. Get all your questions answered, get a quote, and buy a policy online.
PruHealth - This company is a private health insurance specialist. They offer very competitive prices on several different levels of cover, along with an extensive network of providers.
Aviva - It goes without saying Aviva is one of the first names in UK insurance products. Here you can look up health insurance information, start the quote process, retrieve previous quotes, and purchase online.
AXA Healthcare - AXA is another one of the big names in UK insurance. Their private healthcare insurance can cover everything from routine care to cover for serious conditions like cancer and heart disease.
Shopping for health insurance is easier when you use a comparison website. Comparison websites make it easy to submit one form and get multiple quotes. Check out these helpful links:
Go Compare - Use this site to shop for health insurance quotes from multiple providers. While you are there, sign-up for a chance to win free home insurance.
Money Supermarket - Here you will find quotes from many different types of healthcare insurance policies including family care, child health insurance, and individual insurance. You can speak directly to one of their insurance advisers if you need help.
Confused.com - A site offering quotes on standard policies and personalized plans. You can purchase online or talk to an adviser before making a purchase decision.
Compare the Market - Filling out a single form gets you access to health insurance quotes from companies like Bupa and Aviva. They also offer a health insurance guide and an FAQ section.
Tesco Compare - Offering health insurance quotes through their partner site, Active Quote Ltd. Quotes are provided by the UK's leading health insurance companies.
Money.co.uk - More than 70 healthcare insurance policy options are available for comparison here. The site works with partners like Saga and QuoteZone.
Money Saving Expert - There is lots of helpful information here including important questions to ask about medical insurance. There is also information about dental insurance and health cash plans.