Business Attitudes to PMI
Businesses would be keener to provide Private Medical Insurance (PMI) for employees if the benefit was more affordable, according to research published by Bupa. It is perhaps not surprising that at a time when austerity is biting, cost issues remain so prominent. But what may bring it home all the more is that fact that 50% of businesses think the private healthcare sector needs to change as much, if not more, than the banking sector.
Almost half of employers said private healthcare needs to be more affordable, while 42% said that cost was a barrier to investing in health cover. More than a quarter of businesses responding said if cover was available at a more affordable level, they would be more likely to offer the benefit, and 17% said they would offer PMI if they thought it offered better value.
More than a third (37%) said the sector needed to improve transparency, such as by demonstrating the quality of service is provides. Meanwhile 28% said the sector needs to demonstrate that it is capable of delivering on the quality it promises.
Nonetheless, private healthcare remains a benefit that is truly valued by those who do provide it. Of those companies that do provide PMI, 53% said that staff considered it to be a standard work benefit, while 42% said the importance of their employees’ health and keeping them in work was a key reason for offering this benefit.
Commenting on the results, Dr Damien Marmion, managing director of Bupa Health Funding said: “The research clearly shows a strong appetite for private healthcare from both employers and employees alike; but many are calling for lower costs and a clearer demonstration of quality from the sector. Cost is also a big barrier to growing an industry which has stagnated. This is why we are pushing for the publication of outcomes from hospitals and consultants and are seeking a price reduction of up to 15% or more from some major hospital providers for the benefit of hard pressed customers.
“We believe more companies want to provide healthcare to more of their staff because we are already seeing a growth in demand from the banking sector. If the industry does not work together to address these issues around cost and drive improvements to quality and transparency, the sector will continue to decline. We must reform to grow the sector so that more people can access private healthcare services.”
Paul Roberts, consultant at IHC, said: “Bupa believes the whole sector must work together and go further to drive better value for customers. IHC clients have the advantage of regular market testing to ensure the best prices for their insurance.
He added: “Bupa is pushing for the industry for better supplier management – surgeons and hospitals – and in the absence of good outcome data, it will fall to a price argument. Simply put, there are no big data sets to draw on to properly consider, so price becomes the default point of negotiation. IHC applauds Bupa for trying to grasp this thorny problem and we expect some small incremental gains rather than a revolution.”