Medical Insurance

What is Private Medical Insurance?

Private health insurance covers the cost of using non-NHS medical services if you fall ill, are injured, or require other procedures with a private healthcare service. To use these services, you will need to pay fees.

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Like the National Health Service, a private medical service is made up of GP surgeries, hospitals and clinics. Most non-NHS medical groups are companies, although some are charities or not for profit organisations.

Most people using private healthcare services do so with insurance policies. Each policy will be different and will cover the costs of specific conditions or a particular type of treatment.

While individuals can take out insurance policies for themselves or their families, it is much more common for employers to take out an insurance policy for their staff as a benefit. Workplace health insurance is a type of group policy.

How does private health insurance work in the UK?
There are two main types of medical insurance: ‘indemnity’ and ‘cash-plan.’

Indemnity insurance will cover specific treatments that meet the for acute illnesses and severe injuries, on a short-term basis. The insurance could cover having surgeries, private rooms in hospitals, and specialists’ fees among other things.

Outpatient care after the initial treatment, such as physiotherapy or counselling will also often be included in an indemnity plan.
Most of the time, the insurer will try to get you into a private hospital, although they also can make use of NHS hospitals, for which they pay fees to the NHS.

A cash-plan policy is one designed to help you with the costs of more minor treatments. These can include minor surgeries, non-essential procedures and dental or optical care. It might also cover costs to allow you to stay in an NHS hospital if you would otherwise be treated on an outpatient basis.

There are also other types of plan called ‘six-week plans’ or ‘month plans.’ These cover the cost of treatment if the NHS waiting times for what you need are likely to be over a set period.

Most insurance plans will not cover you for any pre-existing conditions or for chronic conditions you have. However, there are many which can and do.

If you want these to be covered, the agent or broker you speak to should outline the policies they are offering to you. They must tell you about the level of cover they, and if they meet the needs, you have.

Medical insurance claims
Claiming on your medical insurance policy means to get the insurance provider to pay the healthcare company for any expenses incurred as they treated you. Generally speaking, all you have to do is
provide the hospital or clinic with details of your policy, and you’re good to go. Without any more input from you, the insurer pays the hospital.

But, sometimes, medical insurers will refuse to pay out for a treatment that a policyholder has received. When this happens, the hospital will come back to you to reclaim the money.

There can be many reasons for this, and some of them are valid. Sadly, we often hear from patients from different providers who have been wrongly denied help to cover the costs of treatment.

Sometimes, when the claims aren’t accepted by the insurer, the insurance company is at fault, as it has not stuck to the rules from the Financial Ombudsman Service (FOS).

Mis-sold Medical Insurance
Medical insurance, like all other insurances, can be mis-sold. Private medical insurers are registered with the Financial Ombudsman Service which means there are rules that they have to follow. With medical insurance, a broker or provider must provide a suitable policy for any patient who asks for specific requirements.

If a patient has outlined specific needs, such as insurance cover for pre-existing conditions they have or cover for cosmetic surgery to aid recovery after an injury or medical procedure, then the insurance sold to them must include this. A medical insurance policy has likely been mis-sold if the policyholder was told that their needs would be covered by the policy, but this was not the case.

It is also not uncommon that patients will require follow-up surgeries or extra postoperative care, which is needed and recommended by their surgeon, specialist or GP. Sometimes, however, insurers will fail to pay out for these, even when they should do. Most insurance policies will consider additional care as part of the overall treatment and will include these in the level of cover provided.

For these reasons, a patient’s medical history needs to be looked at when they are discussing health insurance options. Their age and other indicators of health should also be asked about. If a patient is already receiving treatment for a condition, then this will be considered when they are being sold their insurance.

Patients should be asked if they want the insurance to cover this. If they are not asked about their medical history, there is a chance that the policy was mis-sold to them as it wasn’t appropriate for their needs.

For any mis-sold private medical insurance policy, it is likely you will be able to claim a refund or compensation for any expenses that you have incurred.
Sometimes, you will be able to obtain not only a refund of expenses but also an extra payment to cover stress from the process. This is often not required, but insurers will sometimes allow you to claim it to try to keep your custom.

How to claim back medical expenses when abroad
Claiming back medical expenses while overseas can be a more difficult task than it is to claim while you are in the UK. If your treatment was from a group which is not approved in the UK, your insurer might not guarantee to pay out for it.

If the private company is approved and registered in the UK, the medical insurance company might be liable to pay for at least some of the treatment.

There are cases where they try to pay less than they owe, and hope that you don’t take matters further where they might be required to pay out more.

It is always worth working with a claims management company to see if you are owed money for any medical procedures that you paid for while abroad.

Benefits and drawbacks of private medical insurance
There are many benefits of having private medical insurance. While it can be expensive, there are reasons that many people choose to use private healthcare over NHS-run services. Here are just a few of them:

  • Generally shorter waiting times than the NHS
  • Access to private rooms instead of wards
  • The availability of treatments not offered by the NHS
  • More access as an outpatient
  • One-on-one access to physiotherapists and other professionals

All of these benefits, however, come at a cost. These are unaffordable to most, but with the help of a good insurance policy, most people can afford private care. If you are fit and healthy, and mostly rely on the NHS when you can, it is possible to build up a no-claims discount. This means that the less you rely on your insurance policy, the cheaper it will become.

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