As a health insurer, our aim is to work to improve the efficiency of healthcare in the UK. I believe...
As a health insurer, our aim is to work to improve the efficiency of healthcare in the UK. I believe that the best way of achieving this is by working in partnership with the government of the day. How might this aim be reached?
Two of the areas I have discussed with opinion-formers over recent years are the removal of tax disincentives and the possible methods of reducing private medical insurance (PMI) premiums.
I was encouraged, therefore, by Dr Liam Fox's plan to abolish both employers' National Insurance (NI) and employees' benefit in kind on PMI in order to boost the corporate market.
It has been evident over recent years that the corporate market has provided the main area of growth in the PMI market, particularly small to medium-sized companies and, almost certainly, it continues to have untapped potential. The removal of tax disincentives would undoubtedly generate growth, but it would be difficult at this stage to project future growth of the market as a result of following this policy.
Another area I have discussed is the way by which PMI could be made more accessible to a wider audience. One means of doing this would be to ensure that the NHS is in a position to treat more serious conditions such as cardiac and cancer care effectively, so that more flexible PMI policies could be offered that exclude these treatments. PMI premiums could be reduced to reflect this.
Dr Fox has suggested that this proposal could reduce PMI premiums by 30%. However, I feel this may be a little ambitious and our calculations suggest that the figure is likely to be half of this. While cardiac and cancer treatments are some of the most expensive, they are not the most common claims we experience, and I would therefore question whether they account for a third of our claims costs.
The way forward is for continued innovation, in conjunction with the development of a true relationship between the public and private sectors, to meet consumers' expectations for healthcare.
One example of this is the idea of a Welfare ISA that I developed last year and presented to the Treasury. This would allow an individual to save for their health and welfare needs by providing a tax-free fund that could be drawn upon in times of need.
With Government support, ideas such as this could provide the cornerstone of a truly integrated healthcare system that would provide a mix of public and private provision. Co-operation and equal partnership between the two sectors will be key, regardless of which party is in power. What is clear is that this is too important an issue to be made the subject of political wrangling and it may be that a cross working party is needed to move this issue forward.
