Is PMI a workplace ticking time-bomb?

For many employers, the cost of private medical insurance is spiralling out of control. Typically, PMI has increased in cost between 5% and 15% every year for the last 10 years. During this time, the average annual cost of a policy has risen from £500 to £1,870, partially due to expensive drug treatments and lack of competition between insurers. The problem doesn’t look set to be resolved any time soon.

As the workforce ages, the number of claims will increase. Over 50s currently make up 27% of the workforce, with this number predicted to rise to a third by 2020. The increasing cost of cancer treatment for example, is forcing employers to question the affordability of PMI arrangements. For example, it’s not uncommon to see claims over £20,000, and some treatment costs up to £100,000. Of course employers can cap the amount employees can claim, however, this is a short-sighted strategy. The way an employer looks after poorly employees is a critical part of its employer brand. Cut short an employee’s treatment, and the implication is that expense comes before your employees’ health. Hardly a message that will rally engagement with your benefits scheme, or win the hearts and minds of your workforce. In an age when employees can and will share their healthcare experience across social media, employers need to ensure this reflects positively on their brand. If not, they risk alienating current and prospective employees. 

There are other considerations which will impact how HR manage healthcare, such as return to work schemes, level of support offered - mentally and physically, resourcing, and duty of care. It’s therefore crucial for employers to approach the health and wellbeing of their workforce as a whole.

Taking a holistic approach to wellness