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Health is everything: How insurers help secure the health of the nation

Yvonne-Braun500x500.jpgOne thing the past three years have taught us is that nothing is more important than our health. Governments across the globe ordered unprecedented economy-wide lockdowns to protect their populations against Covid, vaccines were developed and vaccination programmes deployed at blistering pace and vast scale. Health, often taken for granted, is now much more widely appreciated as a key enabler for everything else, including the productivity of the workforce and our prosperity and wellbeing as a nation.

The NHS has been central to the UK ever since Health Minister Aneurin Bevan launched the service on 5 July 1948. Its founding principle, to provide care “free at the point of need”, irrespective of a citizen’s ability to pay, but funded by general taxation, remains the backbone of the service today.

However, times, our health, and the sophistication of the treatments now available, have changed immeasurably since 13-year-old Sylvia Diggory (née Beckingham) became the first patient to be treated by the NHS. Men born in 1948 could expect to live until they were 66, while women could expect to live until they were 70. Fast forward 75 years and average life expectancy is 81.7 years.

Our increasing lifespans are a wonderful achievement but an ageing society also leads to ever-increasing demands on the NHS. Since 2018 we have seen more people turn to private health insurance year on year, and in 2021 almost 5.5 million people were covered by individual and group policies – the highest number since 2009. This pattern looks set to continue, with recent reports suggesting that nearly half a million people took out private cover in 2022, offering them greater control and flexibility, quicker access to non-urgent medical procedures, and crucially, prevention.  

Income protection covers 3 million workers in the UK and is often perceived as offering solely a replacement income should a policyholder become unable to work. But protection insurers play a similarly crucial role for health, particularly in mental health support. With one in four people in the UK affected by a mental health condition in any one year, protection insurance is a vital defence. It is especially key in the workplace, with features like quick diagnosis and access to mental health treatment, and employee assistance programmes helping people tackle stress and anxiety. Income protection providers also offer specialist rehabilitation services to support employees to return to work more quickly.

As the nation recovers from the pandemic, it is time to fully recognise the role insurance can play in complementing the vital work of the NHS.

Why now?

The independent healthcare sector has worked side by side with the NHS for decades, from providing dentistry, optical care and community pharmacy services, to many GP practices operating as private partnerships. Health and protection insurers also played a part in keeping strain away from the NHS during the pandemic, particularly through evolving and expanding their digital services, mental health support and continued cancer treatment.

However, as the demands on the NHS have continued to grow, exacerbated by the pandemic, the health service is now frequently described as being in “crisis”.

That is why the role of health and protection insurance in supporting the NHS is more essential than ever. By navigating these challenging times together, we can help ensure a sustainable healthcare system for all.

Complement, not compete

The independent medical sector is set up to complement the NHS, not compete with it.

The purpose of health and protection insurance is to provide customers with peace of mind that, should anything happen to them or they need medical care, they and their family will be supported. With health insurance offering reduced waiting times, speedy diagnosis and treatment, patients have more control. They can also have more flexibility over their appointments and access to other services, such as remote GPs, timely mental health support and private hospitals. Some providers also cover several specialist drug treatments, or a wider package of care and services, which may not be available on the NHS.

This prompt access to services and treatment often prevents health conditions from worsening. It also helps people get back on their feet, and back to their work, family lives and other commitments more quickly. This shows that health and protection insurance are just as critical when it comes to protecting our health for the long term. Potentially preventable physical and mental health conditions, including some cardiovascular disease, cancers, and type 2 diabetes, are the leading causes of ill health and death in the UK. If action is taken to tackle the root causes of these conditions, 40% of the burden on health services in England could be preventable. 

Making better lifestyle choices, like keeping fit, having a healthy diet, or stopping smoking, can drastically improve health, and many health insurance providers offer incentives to encourage this. In addition to being there at the point of the need, the private sector is able to concentrate on health prevention in a way that the NHS is not able or expected to. In supporting people to live a heathier life, take steps to be more active and make more positive health decisions, people will live longer in better health, lowering the burden on health services, NHS or otherwise.  

Combined, all of this demonstrates how insurers are able to help share the load and free up the NHS’s capacity to focus on other essential services and treatments, while those who are insured continue to contribute to the vital work of the NHS through their tax and National Insurance contributions.

Workplace provision creates benefits for all

Employers play an especially important role in protecting the health of their workforce. Of the 5.5 million people in the UK with health insurance, 75% are covered through their employer. Workplaces across the UK also provide life insurance cover for 9.88 million people, and income protection for 2.775 million people.

Supporting and protecting a healthy workforce is the right thing for an employer to do, and it’s in their best interest. The Bupa Wellbeing Index found that 42% of employees would be more likely to remain in role if it offered good health and wellbeing benefits. By providing insurance, employers can demonstrate that they genuinely care about the health and wellbeing of their employees. Bupa’s research also found that health insurance ranked in the top three most sought-after benefits for more than a third (39%) of employees. This was behind only flexible working (53%) and a company pension scheme (46%).

Beyond making them a more attractive employer, offering health and protection cover also helps businesses boost productivity and in turn, the economy. Between June and August 2022, 29% of people not in the labour market gave long-term sickness as the reason for this, significantly contributing to labour shortages across the UK. Recent analysis by the Times Health Commission also found that ill health among people who are of working-age is costing the economy roughly £150 billion a year, which equates to 7% of GDP. Recent research from Vitality support this, revealing that the British economy lost £127.9 billion in 2022 as a result of employee absence or a lack of productivity at work – a 39% increase compared to 2019.

Utilising the power of early intervention that health and protection insurers offer is key to supporting employees back to full health and back into the workplace as quickly and effectively as possible. In fact, figures from Group Risk Development (GRiD) show that group protection insurers provided 220,886 interactions for customers with help and support services. Even before intervention is necessary, giving employees access to physiological, mental, and financial wellbeing programmes will help prevent injury and illness occurring in the first place. Vitality research found that claim costs were up to 46% lower for those who led a more active lifestyle.

This greatly reduces the long-term cost for everyone involved, helping employers, employees and the state alike: employers don't need to find additional resources to replace workers who are unwell, employees can continue to work or return more quickly, and the state saves on social security payments. This is supported by recent research from Axa Health, which demonstrated that health insurance can directly contribute to cost savings on sickness benefits, improve productivity, and improve workers’ quality of life.

Now is the time for insurance to be part of the national conversation about how to support the nation’s health and wellbeing.

Last updated 03/02/2023