With health cash plans costing as little as £1 a week, what do these actually cover? Sally Hamilton reports
If you read nothing else, read this…
- A £1-a-week health cash plan can pay out far more than is paid in.
- Employers can use a cash plan to help reduce absence and meet duty-of-care responsibilities, such as for eye tests for visual display unit users.
- Providers set differing annual claims limits and rules vary on the proportion of each claim they will meet.
A £1-a-week health cash plan sounds cheap and cheerful, but employers seeking to improve the health and wellbeing of their staff must be sure it is money well spent.
In September, high-street retailer Poundland, which sells everything in its stores for £1 an item, made such cash plans available to its employees. Although the £1-a-week plans cleverly fit in with the retailer’s brand, Poundland is not the only employer to offer such low-cost perks, which refund members for everyday healthcare costs, such as visits to the dentist or optician.
Carol Porter, senior healthcare adviser at reward consultancy Enrich, says: “£1 a week is the bottom level, but it does cover everyday costs up to certain limits. However, there is a wide range out there and it is difficult to compare them easily. Employers have to be clear about the benefits they want.”
What £1 buys from one provider may be quite different from another, however. Some provide a wide range of benefits, from dental and childbirth payments to cash sums for hospital stays, while others provide a narrower range but with a bigger pot of cash per benefit group. Such plans can also be used to help employers reduce absence levels and meet duty-of-care requirements relating to eyecare for users of visual display units.
Providers also set differing annual claims limits and rules vary on the proportion they will meet of each claim – typically 50%, 75% or 100%. HSF, for example, meets 50% of a dental claim on its £1-a-week plan (up to a £50 annual limit), but pays 100% to members who pay £3 a week or more. HSF automatically adds employees’ partners to the plan, while Simplyhealth charges an extra £1.25 to do so.
Larger employers may consider tailormade plans to address the specific health needs of their workforce. Simplyhealth, for example, offers bespoke schemes for 400 to 500 employees or more. James Glover, sales and marketing director at Simplyhealth, says: “An [organisation] that has a particular issue with musculoskeletal problems, for example, might want a bigger cash benefit for physiotherapy.”
Because the most popular benefits, and biggest claims, tend to be for optical and dental cover, employers might decide to set the highest cash limits in these categories. However, some workers might find a cash payment on the birth of a child attractive.
Birth or adoption
HSF pays £100 for the birth or adoption of a child as part of its £1 plan, while Simplyhealth scheme members can buy the benefit (worth £200) as a 20p-a-week add-on. Stephen Duff, sales and marketing director at HSF, says: “An employer-sponsored scheme at £1 a week tends to be a springboard, with staff adding to it.”
HSF’s £1-a-week premium includes a £50- a-year dental and optical pot and £100 towards physiotherapy. Paying £6 a week, those figures rise to £400 and £600, respectively. The highest payment, £12 a week, provides higher limits, including £850 for dental and optical treatment and £1,200 for physiotherapy.
Simplyhealth’s Glover says physiotherapy, for which its £1-a-week plan will refund up to £150 in a year, shows how cash plans can be an important part of a corporate health and wellbeing strategy. “If employees get a twinge in their back from gardening, they do not need to go to their GP for a referral [because] they can immediately make an appointment with a physiotherapist,” he says.
Employers can also use cash plans to provide an employee assistance programme, with some £1 plans providing access to a telephone- based service. Staff can also top up their plan to include face-to-face counselling. If the cash plan is offered through a voluntary benefits package it is worth employers reminding staff that they do not need to be ill to use a cash plan.
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