Group Private Medical Insurance

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What is Group Health Insurance?

 

Group Health Insurance provides your employees with access to private healthcare bypassing lengthy NHS waiting lists.

 

Employees receive private healthcare when they need it, ensuring they are back on their feet as soon as possible.

 

A highly valued benefit 😀, helping you to recruit and retain the best people whilst reducing employee absenteeism.

 

21% of people have suffered long term ill health during their working life – Met Life 2012

 

137.3 million working days were lost to sickness absence 🤒 in 2016 according to the Office for National Statistics.

What is it?
 

What Does Group Health Insurance Cover?

Group Health Insurance pays for healthcare and treatment in private medical facilities. The scope of the cover can vary considerably depending on the options you select.

Core Inpatient Cover

Day patient and inpatient treatment, covering employees if they need treatment requiring a hospital bed for a day or overnight. This includes the treatment, testing, consultations etc.

Additional Outpatient Cover

To get cover for initial consultations and diagnostic testing, you’ll need outpatient cover. This is recommended to avoid the potentially lengthy NHS outpatient waiting lists.

What does it cover?
 

How Does Group Medical Insurance Work?

The level of cover and type of treatment required determines the exact process. However, the main variation depends on whether the policy includes outpatient cover.

PMI without Outpatient Cover
Group Private Medical Insurance - No Outpatient

PMI including Outpatient Cover
Group Health Cover - Outpatient Treatment

Without outpatient cover, an employee would have to go through NHS waiting lists for testing and initial consultations.

How does it work?
 

Your Key Policy Options

 

Outpatient Cover – gives access to initial consultations, testing and scans privately

 

Therapies Cover – includes treatment such as physiotherapy and osteopathy, popular among office workers suffering from a common complaint: back pain.

 

Dental Cover – some employers include dental cover for routine treatment (e.g. fillings and checkups) as an optional extra to the standard cover for oral surgery and emergencies.

 

Psychiatric Cover – employers also have the option to add both inpatient and outpatient psychiatric treatment.

Additional options
 

Our Delivery

We highly value our independence – and it’s beneficial for every client. As we’re totally free from ties with insurers, you get the benefit of Group Health Insurance quotes from across the market. That’s how you can be sure you’re getting the best terms.

The Fact Find

You need to provide us with some minor employee details to compare policies and find the best deal for you, your company and your employees.

The Research

Once we’ve got the required data, we’ll research the whole UK market and find the best options for your circumstances.

The Report

We’ll provide you with a recommendation report containing all of your options. You’ll also receive an outline of the insurer we’re recommending to you and our reasons for this.

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This Guide

⏰  10 min read
Michael Englefield
Written by:
Michael Englefield
Content Manager at Drewberry
 

What is Group Health Insurance Coverage?

Group Health Insurance provides employees with Medical Insurance paid for by their employer. It offers staff treatment in private facilities for a range of medical conditions. Usually, this is faster and with superior amenities (e.g. private rooms) than the NHS could offer.

Employees value Group Medical Insurance. It’s been shown to boost employee retention and make it easier to hire new workers. As the employer, you get the benefit of reduced staff absenteeism and, as private healthcare treats your workers faster, they recover quicker and can return to work sooner.

Nadeem Farid
Employee Benefits Consultant at Drewberry

Health Insurance offers treatment for acute (i.e. curable) conditions. This might include the need for a joint replacement or treatment for cancer. It will also cover chronic conditions (e.g. heart failure) up to the point of diagnosis.

There are many options to consider when setting up a group PMI scheme. To make sure you’re getting the right policy for you and your company, it’s worth speaking to an expert such as the team at Drewberry.

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Why offer group health insurance?

What are the Benefits of Group Health Insurance?

 

Group PMI Benefits for Employees

  • Fast access to private medical care that your employer pays for
  • Can cut time spent off sick on reduced sick pay
  • Potentially offers cover for therapies, e.g. physiotherapy. This can help with back pain office workers often suffer with
  • Employers may choose to allow you to add family members to the scheme, offering them the same cover
  • Potential cover for pre-existing conditions if your group scheme is large enough.
 

Group PMI Benefits for Employers

  • Reduced staff absenteeism 👍
  • Gets employees treatment faster and therefore back to work sooner
  • It’s a valued employee benefit and can therefore improve employee retention and recruitment
  • Premiums are usually an allowable business expense against corporation tax (although there are other tax implications – see below)
  • If employers pay for family members via salary sacrifice, it may reduce your National Insurance bill.
 

Can I Get Group Health Insurance if I’m Self-Employed?

You can get Health Insurance if you’re self-employed, but this would usually be a personal policy paid for out of your own pocket.

health insurance for self employed individual

Contractors’ Health Insurance is available for those who contract through their own limited company. Sometimes people prefer to run cover through their business and have their limited companies pay for Health Insurance.

However, it’s important to be aware that the employee will have to pay additional tax if your limited company pays for the Health Insurance. This is because PMI is a P11D or benefit in kind.

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I would like to say thank you to Ciaran King for his professionalism, respect and sensitivity with dealing with my income protection insurance.

Cecilia Walsh
04/12/2017
Does Employer Health Insurance cover pre-existing conditions?

What Does Group Medical Insurance Cover?

Just like any Health Insurance, Group PMI is designed to cover acute conditions. No PMI is designed to treat long-term, chronic conditions – these will be referred back to the NHS.

what's covered by group PMI?

The main difference between chronic and acute conditions is that acute conditions are curable with treatment, but chronic conditions remain with you.

Acute conditions include broken bones, cataracts, nasal polyps and hernias. Chronic conditions include diabetes, arthritis, high blood pressure and psoriasis.

While your Employee Health Insurance will cover the diagnosis of chronic conditions, it will only do so up to the point of diagnosis. At that point, you’ll be referred back to the NHS to continue your treatment.

The difference between chronic and acute conditions is not, as many people assume, their severity. For instance, the common cold and a heart attack are both acute conditions. With time and assuming you receive the correct medical care, both will respond to treatment and then pass.

Emma Wilson
Employee Benefits Consultant at Drewberry

How does inpatient-only cover work?

If you’ve got inpatient-only cover, the NHS would be responsible for any diagnostic tests. This is also true for any therapies required (e.g. physiotherapy) to get you better.

With inpatient-only cover, the insurance wouldn’t kick in until you needed an operation. Fortunately, once the NHS establishes the need for an operation, the wait for this privately would be almost non-existent.

Your Health Insurance will work differently depending on whether you add outpatient cover or not

This is compared to current NHS waiting lists – there were 3.7 million people in England alone waiting for an NHS operation at the end of March 2017.

How does outpatient cover work?

If you have a plan with at least some outpatient cover, then once your employees receive a referral from a GP the Private Medical Insurance kicks in. They’re then entitled to some level of private outpatient treatment, up to any outpatient limit you might set for your employees (see below).

This includes not just diagnostic tests but may also include physiotherapy etc.

 

 

Group Health Insurance Exclusions

In the UK Health Insurance isn’t designed to provide all medical treatment. In some cases, especially for chronic conditions, you’ll still need to use the NHS for care. Common PMI exclusions include:

  • Emergency careIs anything excluded from PMI?
  • Ongoing management and treatment of chronic conditions
  • Kidney dialysis
  • Fertility treatment/IVF
  • Pregnancy and childbirth (unless there’s complications)
  • Treatment for alcoholism/other substance abuse issues.

Will PMI Cover 🤕 Pre-Existing Conditions?

Whether or not your policy will cover employees’ pre-existing conditions depends largely on the type of underwriting you choose.

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How Does Employee Health Insurance Work?

How Does Group Health Insurance Work?

The company pays for Group Health Insurance for the benefit of employees. The employees receive an insurance that allows them to receive healthcare in top-notch private medical facilities across the country.

How does group pmi work?

Making a claim

When your employees need to make a claim, they’ll need to get authorisation from the insurer. They’ll look at the medical need for the claim (e.g. a GP referral).

Once the employee receives the claims authorisation number, they can take it to an appropriate private facility for treatment.

This treatment will usually be faster than would be available on the NHS. However, even with the best Private Medical Insurance, the process will start with a referral from an NHS GP. This is because Private Health Insurance usually excludes GP (also known as primary) care.

Once your employees have a GP referral, their treatment will depend on the type of Health Insurance cover you’ve provided.

 

How is Group Health Insurance Underwritten?

As a company, your decision on how to underwrite your employees is very important. It will likely effect the cost and what your policy covers your workers for.

The underwriting options available to you will depend partly on the size of the group, as only larger companies are eligible for certain types of underwriting.

As a business looking for Corporate Health Insurance, you have three underwriting options plus a fourth option if you’re looking to move between schemes at renewal.

Full medical underwriting (FMU)

Full medical underwriting involves employees making a full disclosure of their medical history. The insurer will likely exclude any pre-existing conditions, but employees will know exactly what these are and which exclusions apply to them from the outset.

How is group medical insurance underwritten?

This option is available to schemes of all sizes and is usually the cheapest option because of its upfront exclusion of pre-existing conditions. However, given employees must declare all medical history there can be a lot of paperwork to get such a policy off the ground.

Moratorium underwriting

Unlike FMU, insurance with moratorium underwriting requires less in the way of administration. A moratorium underwriting means that a condition will be excluded if, at the start of the policy, the employee has suffered from it in the past five years.

No medical disclosures will be made upfront – rather, when it comes to a claim the insurer will check the employee’s medical history to make sure that condition hasn’t occurred during a period where it would be disqualified. Providing it hasn’t, the employee will be eligible to claim for it.

Moratorium underwriting is one of the most commonly chosen options as it allows for pre-existing conditions to be covered after employees have spent two consecutive years on the policy without receiving any advice, medication or treatment for that condition. Plans with any number of employees are eligible for moratorium underwriting.

Matteo Mockler
Health & Wellbeing Expert at Drewberry

Medical history disregarded (MHD)

MHD underwriting is the best Medical Insurance underwriting available. It ignores any pre-existing conditions, no matter when your employees have suffered from them. As the name suggests, your employees’ previous medical history is totally disregarded and they’re able to claim for any eligible condition under the policy’s terms.

What is medical history disregarded health insurance?

It’s the most expensive type of medical underwriting because it’s so all-encompassing. Medical history disregarded underwriting is only available to large groups, usually starting with at least 20-25 people.

This is because the risk of a claims is spread wider over many more people, making it more economical to offer such a comprehensive Health Insurance option.

Switch or Continuing Personal Medical Exclusions

Lastly, switch or continuing personal medical exclusions (CPME) underwriting are terms you need to look at if you’re moving from one insurer to another. This will ensure any pre-existing conditions you’ve suffered from and received treatment for under the previous policy should continue to be covered going forward with the new insurer.

You’ll need to provide your new insurer with your current insurance certificate and possibly answer some questions about your employees and any members who’ve received treatment under the old policy. Any exclusions already on the old policy will also be copied across.

Switching your own Individual Private Medical Insurance can be complicated enough, let alone switching an entire Group Medical Insurance scheme containing many employees.

Not only can Drewberry research the entire UK market to find you the best deal on your Employee Medical Insurance, we’re also here to handle any switch you may decide to make. That way, you can secure cheaper cover or better terms without the hassle of ensuring vital continuation of cover.

Emma Wilson
Employee Benefits Consultant at Drewberry

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How Much Does Group Private Medical Insurance Cost?

Five main factors that determine the cost of Group Health Insurance are:

  • The size of the group – although larger groups obviously cost more to insure as there are more employees, you may be entitled to a group discount for larger schemes
  • The age of each individual member – as we get older, the risk of us developing illnesses and diseases rise, so PMI for older people is more expensive as a general rule
  • The gender of each employee – as women live slightly longer than men their longer lifespans mean they’re more likely to suffer from illnesses
  • Your location – incidence of various illnesses varies depending on where you are in the country, as does the cost of private medical treatment (London hospitals are far more expensive than those in the rest of the country).
  • The underwriting and level of cover you choose.

The cost of your group scheme will depend on so many different factors that it’s impossible to just provide a ‘ball park’ price!

We need to go away with the employee data you provide us and research the entire market. That way, we can be sure we’re offering you the best deal for your PMI scheme.

Matteo Mockler
Health & Wellbeing Expert at Drewberry

 

Group Health Insurance Options

There are several factors which have an impact on your policy’s premiums that can’t be changed, such as where the employees are based for work or the demographic of your workplace.

However, there are multiple factors you can adjust within your policy to increase the level of cover or reduce your premiums.

Level of outpatient cover

Health insurance is designed around inpatient cover (or ‘core’ cover). You can add outpatient cover to inpatient to make up Comprehensive Health Insurance.

Outpatient treatment includes consultations and diagnostic tests as well as outpatient therapies such as physiotherapy, which means this tends to be the area which results in most claims. As a result, because more cover is being provided adding outpatient cover can increase the cost of your scheme.

Nadeem farid can offer you advice on group health insurance

One way to mitigate rising costs that come with adding outpatient cover can be to put a limit on your outpatient treatment.

This means each employee has a limit per year as to how much they can claim on the policy for outpatient treatment. (Note that imaging tests, such as MRIs and CT scans, which are very expensive, don’t usually count towards an outpatient limit because of their high cost.)

Nadeem Farid
Employee Benefits Consultant at Drewberry

Excess

An excess is the option to have employees pay a set amount per year or per claim towards any treatment they may receive. Including an excess and having the employees pay for a proportion of the treatment reduces the risk to the insurer and so can lower premiums.

Psychiatric Treatment

Psychiatric cover is another additional option that can be chosen on most plans. It can provide both inpatient and outpatient treatment for many forms of mental illness and behavioural disorders, potentially covering up to 45 days of treatment per policy year.

Psychiatric cover is a popular option to add, especially with the rise of workplace stress and an employer push to improve mental health and wellbeing in the workplace.

However, psychiatric claims tend to be among the most expensive. Insurers even deal with these claims via a separate claims channel, along with heart conditions and cancer, so adding this cover will increase premiums notably.

Emma Wilson
Employee Benefits Consultant at Drewberry

Six week NHS wait option

Choosing a six week wait option will result in your plan only paying for treatment if the waiting list on the NHS for that particular procedure exceeds six weeks. If the waiting time on the NHS is below six weeks, then employees have the operation on the NHS.

Although this limits the cover provided, it can make significant savings on your premiums as for certain acute conditions many NHS trusts have had waiting lists below six weeks.

Adding family members

Some employers allow you to add spouses and/or dependent children to the Employer Medical Insurance plan. This entitles employees’ families to the same healthcare as employees.

For tax reasons, the employer must pay for their employees’ Group Health premiums. However, there’s no obligation for the company to pay for family members.

The employer can pay for family members if they wish, or alternatively employees can pay for spouses and children via salary sacrifice if the company chooses to allow it.

Matteo Mockler
Health & Wellbeing Expert at Drewberry

Additional hospitals

To keep the cost of your scheme down, many providers offer more than one ‘tier’ of treatment facilities. The most expensive and exclusive hospitals and clinics are on the top tier and access to these may be included for an extra premium.

Dental and optical cover

While standard Health Insurance will offer cover for ocular surgery (e.g. cataracts) and oral surgery, adding routine optical and dental cover to the plan is an additional option.

Adding optical cover to Group PMI will pay money towards your employees' glasses

This will provide cover up to set limits for routine appointments, such as fillings and checkups for dentistry, and opticians’ fees, such as eye tests and the cost of glasses.

Adding a Health Cash Plan

Some employers choose to implement a Health Cash Plan alongside their Private Medical Insurance. This offers cash towards certain routine health expenses, such as dental and optical treatment. It can also be used to cover any excess you implement on the plan.

The employee can claim back the cash they’ve paid upfront as an excess from the Health Cash Plan. Despite having two policies, this often works out cheaper than having just Group Health Insurance with no excess.

Naturally, the more options you add to your Group Medical Insurance scheme the more comprehensive it becomes. However, this will result in increased premiums as a result.

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How is Group Medical Insurance Taxed?

How is Group Health Insurance Taxed?

As an employer, you can usually pay for your employees’ Health Insurance from pre-tax earnings. This makes the premiums allowable as a business expense against corporation tax.

For employees, their employer paid private medical insurance is known as a P11d benefit or a taxable benefit in kind. This refers to a benefit your employees receive that’s not counted as part of their salary but is nonetheless a benefit and so HMRC will levy tax against it.

How is Group PMI taxed?

As HMRC views Group PMI as part of employees’ remuneration, as a company you’ll generally need to pay employer’s National Insurance on the premiums, also.

That usually means employees have their annual income tax allowance reduced by the same amount of the premiums paid on their behalf, meaning they can earn less before becoming subject to tax.

As an employer, you’ll need to fill out a P11d form to declare to HMRC that you’ve provided your employees with a benefit in kind.

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How Do I Provide Health Insurance for my Employees? Get Expert Advice

Many Group Insurance providers only offer quotes via intermediaries such as Drewberry, so if you want to research every UK provider you may have to use an expert. Fortunately, the team at Drewberry are here to help you get the best picture of the market and ensure you can make an informed decision when it comes to your Group Health Insurance policy.

At Drewberry we have a team dedicated to finding the best scheme for your company and your employees. We’ll search the entire market so you can be sure that you’re not only getting the best price but also cover that’s as comprehensive as you need it to be.

For help and advice with all your employee benefit needs, don’t hesitate to pop us a call on ☎️  01273646484.

Tom Conner
Director at Drewberry

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