Independent advice on private healthcare
Health cash plans : Overview
What is a health cash plan?
A Health Cash Plan is a low cost health plan that pays cash sums towards the cost of a wide range of treatments. Cash sums are paid if you have to go into hospital, see a specialist, visit the dentist or optician, give birth or require alternative therapies such as homeopathy, acupuncture or physiotherapy. They are geared towards the day-to-day health expenses we all have to meet.
Health cash plans encourage you to seek and receive early medical investigation and treatment. Helplines and health screening are increasingly common inclusions. Some now offer discounts at selected health clubs. Some offer more specialised benefits which may be tailored towards your particular needs such as benefits for illness at home, aftercare and home help.
Premiums are collected monthly, usually by direct debit.
A low cost health plan may also include or offer other insurance such as critical illness insurance, funeral benefits, and accidental death benefits.
Typical advantages of a health cash plan
- No medical required before joining
- Can be used towards the cost of dental and optical treatment plus many other categories
- Children are usually included free of charge where one or more of the parents are covered
- Premiums do not increase with age
- Unlike PMI, the premiums you pay aren't based on your age or gender, although some providers have upper age limits for new joiners. This means that cash plans can be particularly valuable for older plan holders.
They are not private medical insurance
Private medical insurance pays for treatment and operations performed privately. A Health cash plan complements NHS or private treatment by paying for everyday health treatments. Some people choose cash plans when they would not consider private medical insurance. Some have both.
Health cash plans were once just Hospital Cash Plans, but they have evolved so much into offering a wider variety of healthcare benefits that it is important to dovetail your health cash and private medical insurances.
Cash plans only help with the cost of treatment, not its provision, so you still have to seek out the treatment yourself.
Most do not cover all your expenses, only a proportion, and each benefit has an annual limit. Different plans refund different amounts, usually between 50% and 100% of the bill, up to a pre-set limit. So, if your healthcare bills are fairly modest, look for a low-cost policy with low benefit limits but 100% payouts.
Almost all policies have a waiting period of three to six months before you can begin to claim benefits, which rises to ten or twelve months for maternity and paternity claims.
Some health cash plans will not cover expenses relating to any pre-existing medical condition (one which you had before taking out the policy).
Others will exclude any conditions in existence in the two years prior to the start of your policy.
Children are often included free of charge where one or more of the parents are covered.
Another alternative is to take out a policy in a parent's name but just to cover a child. Insurers may not be prepared to do this so it is much simpler to take out a policy for an adult. The premium is not based on age or health, so it is as cheap to take out a policy for an adult and get the children covered free, as it is to pay adult premium just for one child.
There are no known 'children only' health cash policies.