Healthcare Market Review will not extend the market - Capita Employee Benefits

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Savings as a result of today's Competition and Markets Authority (CMA) final report into the private healthcare market are likely to be absorbed by employers, rather than benefit employees through wider cover, Capita Employee Benefits' analysis shows.

The advisers said the report's conclusions do not tackle core issues in the sector, such as medical inflation.

PMI was ranked as the number one benefit employees would find personally valuable in its recent employee insight survey, beating workplace pensions which came in second. However, due to increasing costs, organisations have shied away from offering all employees cover and many have imposed caps or offer less comprehensive plans.

Alistair Dornan, head of health management for Capita Employee Benefits, said: "A short-term effect of the report will likely be lowered premiums for organisations that offer employees private healthcare as a benefit.

"These savings, however, are unlikely to be passed on to employees as few organisations will offer more complete cover or open out private healthcare to a larger proportion of their workforce.

"The reason for this is that the report does not tackle some of the embedded issues within the private healthcare market - such as medical inflation. As such, we will continue to see private healthcare the preserve of the few.

"So, while we welcome the report and its recommendations, we recognise its limitations. It should therefore be viewed as a catalyst for the wider market - including insurers, providers and employer representatives - to develop healthcare propositions that are relevant, affordable and sustainable to all organisations."

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