Need to know:
- Providers are expanding the cash plan offering to offer a broader range of treatments and services.
- Cash plan design is becoming more flexible to help employers better manage their health budgets.
- Health cash plans could offer a cost-effective alternative to private medical insurance for some employers, following the insurance premium tax increase.
Boosting employee engagement and productivity, and reducing sickness absence are among the key objectives for employers.
Many will be looking to achieve these goals by introducing low-cost benefits that have a perceived high value, such as health cash plans. These are used by employees to cover ‘everyday’ healthcare benefits, such as dental and optical check-ups.
For employers, cash plans are helping in their duty of care towards the health and wellbeing of their staff, says Carol Porter, commercial manager of The Health Insurance Group. “They can provide access to counselling support lines to help deal with stress-related problems, and preventative benefits such as health screening and early diagnosis with inclusion of specialist consultations and diagnostics. Online health risk assessments can also be included,” she adds.
New services introduced
This year has seen the introduction of a wider range of specialist therapies to the sector. Andy Wilkins, chief executive officer of Plutus Health, says: “Health cash plan providers are offering more alternative treatments, including things [such as] hypnotherapy, Reiki and Indian head massage.”
Another new addition to health cash plans this year is the ‘GP on the phone’. “Employers recognise that their staff can struggle to arrange GP appointments,” says Porter. “Some have introduced virtual GP surgeries with access to 24-hour ‘tele-doctors’ via telephone or online, which saves employees taking time off work for a basic GP consultation.”
However, Paul Roberts, strategic director at employee health and wellbeing broker IHC, believes it is still early days for the virtual GP. “It is a useful addition, although we are not sure the public is ready for it,” he says.
An additional trend sees some health cash plans now offering 24-hour private GP consultations and covering private GP fees. So, if members cannot get an appointment with their own GP, having access to a private GP becomes a hugely competitive benefit.
Technology and cash plans
This has certainly been the year of the health app, and smartphone users now have thousands of them at their fingertips, but in the fast-paced and highly competitive world of app development, insurance providers tend to get lost in the shuffle. “Competing at this level, cash plans need to focus on the customer interaction and engagement, something we’re not seeing yet,” Roberts says.
Other apps, however, are proving effective, for example, by improving the claims process for employees. Using an app they can upload a photo of their receipt and submit their claim online within minutes, with payments made straight into their bank account a few days later. This makes the product an effective and accessible way of managing routine healthcare costs.
Flexible plans
The sector is also seeing more flexibility in plan design. “This enables employers to tailor the benefits for their staff by choosing particular benefit modules and increasing or decreasing benefit limits according to their budgets,” says Porter.
While health cash plan providers are not necessarily increasing their cover limits, the sentiment felt across the sector is that overall cash plan prices are too low. This is the reason behind the introduction of a more diverse range of therapies to balance this out, and will allow providers to remain competitive, says Wilkins.
The impact of the increase in insurance premium tax (IPT) on 1 November from 6% to 9.5% remains to be seen, although the cost implications for cash plans will be less than those for private medical insurance (PMI) schemes due to the relatively low premiums involved. “This could potentially see a trend toward more employers introducing a cash plan for their current ‘uninsured’ population rather than considering traditional PMI benefits with a higher price point,” says Porter.