According to an article published by the Commonwealth Fund on the 5th of June 2020, just over 10% of the UK’s population has private health insurance – accounting for around 3.3% of total health expenditure. Currently, some 4 million insurance policies are written.
Given the existence of the amazing National Health Service (NHS), which is free for all to use at the point of service, why is there such an interest in health insurance?
Why buy health insurance?
There are many reasons why people choose to buy private health insurance as a supplement to their continued use of the NHS, and these include:
- the avoidance of those queues you are likely to face with the NHS – getting you access to referrals and treatment as and when you need it;
- access to your own private room – with enhanced standards, such as ensuite facilities – whenever you need to stay in hospital;
- your choice of some of the leading specialists and consultants in the country; and
- receiving treatments, procedures and drugs which might not otherwise be available through the NHS.
How health insurance works
Health insurance typically gives you access to different levels of private consultation, hospitals, treatments, and procedures.
The Money Advice Service points out that practically any kind of health insurance is likely to give you some level of private inpatient diagnosis and treatment – including consultations with the specialists of your choice and the procedures they offer.
Cheaper healthcare policies may be quite limited in the range of private hospitals available, or they might restrict you to inpatient treatment in the private wards of NHS hospitals.
Alternatively, you may find that the cost of particular health insurance plans is kept low by limiting your access to private healthcare only if NHS waiting lists are beyond a maximum acceptable duration.
The more you pay, the wider your choice of private hospitals (giving you higher standards of nursing care and accommodation, for example, or those which might be closer to home). More expensive medical insurance policies typically give you more options about how, when and where you choose to be treated.
Bear in mind that some medical issues will not be covered
Whatever type or level of health insurance you choose, remember that there will be some medical issues which are generally not covered.
These exclusions typically include:
- treatment in accident and emergency (A&E);
- consultations, care, and deliveries involving normal pregnancy and childbirth;
- organ transplants;
- pre-existing, chronic illnesses – which will have been declared in your application for health insurance and which typically do not respond well, or at all, to treatment (conditions such as diabetes, asthma, kidney dialysis and epilepsy.
Note that if you buy a cheaper health insurance policy, you may find that treatment for other issues – such as mental health or sports injuries – are also excluded.
The two types of health insurance
If you are thinking of arranging health insurance, you will encounter two different terms relating to how your policy works:
- this is, perhaps, the most common type of health insurance policy, which requires you to provide a relatively limited statement of any pre-existing medical conditions and your current state of health;
- any pre-existing conditions you declare, however, are then likely to be excluded from cover for a certain length of time – the moratorium period (that is often two years, but the period can vary from one insurer to another); and
Full medical underwriting
- this type of policy is usually more comprehensive in the cover offered – so, tends to be more expensive;
- you need to provide a more detailed medical declaration about any pre-existing medical conditions and your current state of health – and your GP may also be consulted about these.
The type of health insurance you choose depends on the cover you need, the level of private healthcare you want, and how much you are prepared to pay for it.
The good news is that healthcare insurance is not as expensive as you may think. And with so many levels of cover available – and options to include spouses and children for an additional fee – you should be able to choose one that suits your budget.