The future of self-pay and insurance demand

There is some evidence that demand for self-pay medical treatment is falling, as the parent company of one of the country's major private hospital providers confirmed that it is strengthening relationships with the NHS to offset the resultant fall in revenue from ‘pay as you go’ patients.

Netcare, the parent company of BMI Healthcare, which runs 56 private hospitals in the UK, reports a continued decline in self-pay patients. Netcare says demand for private medical insurance remains stagnant and fewer people choose to pay for their treatment on a ‘pay as you go’ basis.

But recent Google search figures suggest that after a decline in 2008 and early 2009, there is now a substantial increase in online searches for private medical insurance. What Google cannot tell is if the demand is people searching for cheaper alternatives to their existing insurance, or people without cover seeking a quote.

Private medical insurers vary from those gloomily predicting falling sales to others who argue that recession demand will fall but on recovery, sales will rise.

Specialist intermediaries argue that those insurers that amend and adapt products and pricing to the current needs of consumers, and promote the benefits well will do well, but those who sell tired and overpriced packages and expect business to come in on its own, will struggle.

Jill Watts, chief executive of Ramsey Healthcare, which has 24 hospitals in the UK, calls for better promotion of private healthcare.

"Is is essential that we are able to see what the difference is for NHS patients and private patients. Our core business is private patients. We want to do everything we can to ensure that we grow that business in future."

Ramsay has set up Premium Care for insured and self-pay patients and Watts argues the industry could learn much from the hotel and airline industries, “We have an opportunity to work with insurers and intermediaries to promote the benefits of privately-funded healthcare."

There is consensus that private health insurers have not been aggressive enough in promoting the benefits of health insurance, preferring the easy option of pretty pictures of happy people in hospital.

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The future of self-pay and insurance demand
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