Bupa has sent mixed messages to intermediaries about its intention to increase the cost of premiums ...
Bupa has sent mixed messages to intermediaries about its intention to increase the cost of premiums and offer fewer hospitals and less choice for patients on its group private medical insurance (PMI) schemes, writes Kirstie Redford.
One COVER reader who wished to remain anonymous forwarded a letter from the insurer explaining the changes that would be made to the terms on its group plans. But other intermediaries working in the market have not received the same information.
The letter from Bupa blamed the premium increase on higher costs for cancer treatments as the number of claims for cancer drugs has risen by 5% and the average drugs cost has risen by 24%. The letter said the medical inflation factor applied to experience-rated clients who renew from 1 October 2006 onwards would increase from 9.75% to 10.95%.
The letter also outlined changes to hospital options on group plans. Bupa said recent negotiations had resulted in a reduction in the specific discounts available, meaning its specialist networks such as cancer, outpatient MRI scans and ophthalmology would increasingly replace the existing network concept.
Ann Greenwood, director of business markets at Bupa, said: "This is nothing new, as we review our schemes on an annual basis. We have experienced a 24% increase in the cost of treatment as drugs like Herceptin have become more widely available. This led us to look at new efficient ways to keep the cost down. With the network market failing to grow, we decided to extend our network philosophy with some of our specialist networks. While this means less choice for our policyholders, it helped cut the cost by 25%."
Susie Colley, managing director at West Country Health Care, who advises on group PMI, said she had received no correspondence from Bupa warning of the changes to group policies. "I have tried ringing them to enquire about this issue, but they have yet to get back to me," she said.
