The cost of going private
ONE IN five Brits have opted to pay for private healthcare treatment to avoid NHS delays, strikes and lengthy waiting lists, and their numbers continue to grow.
Some are funding private care on a pay-asyou-go basis, known as self-pay, including GP consultations, alternative therapies and even major surgery.
With 7.33million people on NHS waiting lists private healthcare is understandably tempting, said Akansha Nath, head of partnerships at Credit Karma UK, which carried out the research.
Yet self-paying for an operation is expensive, with a common procedure such as a knee replacement costing £13,925 on average. “It’s a luxury few can afford, particularly in the cost-of-living crisis,” Nath said.
One in four are turning to credit to foot the bill but medical debts can add to your worries. Nath said: “Some medical providers offer their own finance packages but always shop around for competitive forms of credit.”
Others prefer to take out a private medical insurance (PMI) policy from providers like Bupa, Aviva, AXA, Exeter and VitalityHealth, but this involves committing to pricey monthly premiums that will rise steadily over time.
A PMI policy with a £100 excess on claims would cost a typical 40-year-old non-smoker between £60 to £75 a month, but that could rise to hundreds of pounds once people reach their 60s and beyond, which is when they are most likely to claim.
Whilst it is tempting to buy the cheapest policy, they are not all identical, said Assured Futures manager Dale Le Page: “Make sure your chosen policy covers what matters to you, whether that’s cancer treatment or physiotherapy.”
Policies come with plenty of potential addons, but only select them if your budget stretches. “If, say, travel or dental cover are important to you, make sure they are added. If not, excluding them could cut your premium,” Le Page said.
Examine the insurance company’s service and claims experience, which can vary widely, Le Page advised.
“Check online reviews, speak to a trusted broker and ask people who have health cover for their own experience,” he added.
The key thing to remember is that most new policies are sold with a moratorium, where an insurer will exclude any illnesses from the last five years. If you go trouble free for the first two years of the policy, it may add them to cover at that point. What is barred from cover under the moratorium varies according to the insurer, Le Page said.
“People often think high blood pressure is a barrier to taking out a policy or could lead to lots of exclusions, but as long as it’s well controlled may not be the case,” Le Page added.
Moratorium criteria can be stringent, so there is no absolute guarantee your conditions will be covered after two years.
If you already have PMI, you could save by shopping around for a cheaper deal, said Brian Walters, managing director at broker Regency Health.
“Make sure you retain cover for preexisting conditions rather than enrolling afresh on a new moratorium,”Walters said.
Threequarters of new PMI sales are for so-called “guided policies”, where the insurer directs the customer to particular consultants or hospitals where they have negotiated competitive rates.
Guided products are not right for everyone, Walters said: “Brokers often default to guided plans to cut premiums but make sure you understand the policy restrictions.”
Walters recommended taking advice from a broker who specialises in PMI, to understand the complexities and secure the lowest premium.
“It’s a common misconception that you pay more to cover the broker’s commission, but this isn’t the case,” Walters said. “The insurer still needs to pay its salesperson, so the price is the same.”
He added: “Just make sure your broker is genuinely impartial and isn’t pushing the insurer that pays the most commission.”