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About PMI

What is Private Medical Insurance (PMI)

Private Medical Insurance (Private Healthcare) is designed to compliment the services of the NHS. PMI will allow you to receive treatment privately, avoiding lengthy delays through the NHS by securing treatment for eligible, acute medical conditions. Unlike other plans available to you such as Income Protection Insurance, Critical Illness Insurance and Cash Plans, PMI is designed to pay for the treatment you need, when you need it, and to make you better. This benefit is combined with an environment that is conducive to recuperation and to date, no private hospital has reported an incidence of MRSA.

Around seven and a half million people in the UK have a private healthcare plan  (1 in 8 persons) and protection is available from an increasing number of UK and Worldwide insurance companies; there is a plan available to suit every budget and individual circumstance. Your independent financial advisor can advise you on the right plan for you and simplify the marketplace on your behalf.

*Source – Laing & Buisson Health & Care Cover – UK Market Report 2006 (Third Edition)

About the NHS (National Health Service)

The NHS is celebrating its 60th birthday in 2008 and still offers an enviable service that many countries in the world still aspire to. Its emergency services are outstanding and there is also access to centres of excellence for cancers care as it continues to evolve its hospitals and services for the modern day. However, the NHS is not without its downside with incidences of MRSA and promoting the delivery of an 18 week patient pathway from GP referral to the start of treatment by the end of 2008 (18 weeks still means a 4 month delay in your treatment). The NHS treatment is still suffering from its own success. Its budget has also doubled since 1997 and will have almost trebled by 2008; spending in the NHS increased this year by almost £7 billion from £69.7 billion to £76.4 billion. By 2007/08, the NHS budget will be a staggering £92.6 billion. With increasing waiting lists, continual headlines of infections and a budget that is spiralling, more and more people are looking to private healthcare to ensure they gain the quality of care that each of us deserve and need should the unexpected happen.

*Source – Department of Health/Government News Network Press Release 25/01/2006

Acute vs. Chronic

PMI is designed to cover the cost of treatment for Acute medical conditions.

An ‘Acute’ medical condition is a short-term illness which the Association of British Insurers (ABI) classifies as “a disease, illness or injury that is likely to respond quickly to treatment which aims to return you to the state of health you were in immediately before suffering the disease, illness or injury, or which leads to your full recovery.”

In contrast, the ABI defines chronic conditions as: “A disease, illness or injury which has at least one of the following characteristics; It continues indefinitely and has no known cure, it comes back or is likely to come back, it is permanent, you need to be rehabilitated or specially trained to cope with it or it needs long-term monitoring, consultations, check ups, examinations or tests.”

Acute medical conditions can develop into a Chronic condition and your PMI provider will assist you with the transfer of your treatment to the NHS should your condition no longer be covered by your PMI plan.

*Source – Association of British Insurers

Underwriting and Switching Cover/Provider

If you are new to PMI then you will generally be offered two forms of underwriting; which is the process of understanding the risk the insurance company has in insuring your health, and these are Moratorium or Full Medical Underwriting.

Moratorium underwriting means you do not need to answer a series of medical questions about yourself. However, you will be excluded for any conditions you have had treatment, medication, asked advice on, or had symptoms of (whether or not diagnosed), usually, during the five years immediately before you took out the cover. Then, if you do not have any symptoms, treatment, medication or advice for two years after your policy starts; your insurer may cover that condition. There are some pre-existing conditions, such as heart problems, cancer and psychiatric conditions that will never be covered by the plan, as you will need to have regular checkups and/or medication.

Medically underwritten plans require you to complete a series of medical questions about your health and any previous condition you may have suffered from. Normally, any previous serious medical conditions, and possibly non-serious conditions, will be permanently excluded from cover and in extreme cases, cover may be refused. The benefit of medically underwritten plans is that you will know exactly what you are and are not covered for although you may never gain cover for a pre-existing condition, even if you have a long period of no symptoms.

Alternatively, you may be offered a CPME transfer (Continued Personal Medical Exclusions sometimes referred to as CME or Switch terms). Subject to certain conditions, you may be able to transfer the underwriting of your existing medical insurance plan to your new medical insurance plan. Your medical insurance plan is an annual renewal contract similar to that of your home and car insurance, and premiums can increase at renewal. By investigating ‘Switch’ terms, you may avoid gaining additional exclusions for treatment you may have already gained whilst you were covered by your existing insurer. However, ‘Switch’ terms are not guaranteed and your application may be declined or your premium increased; and if you are in the middle of a claim, then it is essential that you gain advice.

Other forms of underwriting available include Medical History Disregarded (MHD) which is available for large company plans and variations on the Moratorium and Underwritten plans. Regardless of underwriting styles it is important that all questions are answered in full as failure to disclose information could invalidate the policy. Your independent English Mutual specialist healthcare consultant will guide you through your choices of underwriting options.

Exclusions

Private Medical Insurance does not cover every illness and condition; there are certain exclusions that are standard to all plans. Usually, healthcare plans will exclude the following:

• Pre-existing conditions (unless included by the provider at time of taking out the policy)
• Normal pregnancy (but they may offer cover for complications)
• Infertility treatment
• Psychiatric or mental illness
• Cosmetic treatments/surgery
• Experimental treatments
• Self inflicted injury
• Treatments from a specialist unauthorised by your GP
• Charges by GPs or specialists for filling out claims forms
• Alcoholism, drug abuse or other addictive conditions
• Routine medical examinations or dental treatments
• Surgical or medical appliances
• Out-patient drugs or dressings
• Kidney/renal dialysis
• HIV/AIDS and related treatments.

Premium Inflation

Medical inflation is substantially higher than the general rate of inflation. Generally, the continually increasing costs of medical technology and hospital/medical/treatment costs are passed on to policyholders in higher premiums. Claims also appear to be on the increase with the NHS unable to cope in many instances with patient needs. Therefore, medical inflation is usually 3-5% above UK inflation making premium rises of 8-10% every year. Medical Inflation combined with premium increases as you get older can make PMI a luxury to many without the right advice. It is therefore, essential to look at what options are available to save on the cost of your insurance premiums.

Money Back Guarantee/Changing your mind

Your Medical Insurance plan always carries a fourteen day money back guarantee period; so if you are not satisfied with the cover or the advice given, then you can cancel within fourteen days your plan without any financial loss provided that you haven’t made a claim.

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