Healthcare trusts: making calls on cover

To this end, very clear scheme rules are a vital "must have", recommends Nick Reynolds, head of intermediary sales at Aviva UK Health, which provides both PMI and healthcare trust administration. This is especially the case if and when a dispute arises, a situation where you can no longer "hide" behind your insurer.

The corollary is that, in a self-funded scheme, employees may think more carefully about making a claim, because they know it will cost their company money rather than some faceless insurer, argues Dalchow. "But when the answer is no and it is a self-funded scheme it is a very different issue," she concedes.

Involving others within the organisation can be helpful when it comes both to establishing and getting buy-in for a self-funded scheme. Trade union or employee forum representatives can be members of a trust board or simply be involved in consultations over changes, adds Dalchow.

Occupational health practitioners may also be a useful resource to tap into and can be a valuable asset when it comes to the reviewing of claims, suggests Naomi Saragoussi, principal at Mercer.

"Your occupational health provider should have quite a good insight into what the main medical issues are and at what level. If you have, for example, high absence for a particular sort of condition, perhaps dermatitis, then you will be wanting to make a decision as to whether or not to bring that into the scheme," she advises.

Communicating with staff

However you implement it, ongoing communication is essential, emphasises Dalchow. "Whenever change is made there can be the suspicion that it is always being done to take something away, but that may not in fact be the case," she says. "You need to be asking what do you want to achieve, what do you want to keep within the scope of the cover or what opportunities are there to make changes, and on what basis?

The question of what or what not to cover is perhaps one of the most challenging faced by trustees when moving into this territory, agree the experts.

With issues such as rising drug costs, the expense of cancer care, "lifestyle" treatments and even IVF there can be a distinct tension between, on the one hand, wanting to engender goodwill and position yourself as an employer of choice and, on the other, not breaking the bank or set potentially expensive precedents.

"A client may decide they want cancer benefits paid in full even if no cure is available, therefore the care becomes palliative," says Jelf’s Judge. "However, it could not change the benefits mid-term to use any available cancer drug if the terms and conditions dictated at the outset that only NICE-approved drugs could be used. If stop-loss insurance had been purchased it would not pay out on any costs which sat outside of the original terms and conditions."

"Having said all this, many clients when they move to self-funding replicate the benefits of their previous healthcare arrangements, in most cases an insurance plan, but may want to change some areas of provision," he adds. "They may want higher levels of complementary medicine or to include dental and optical benefits. Of course they may wish to restrict areas of cover or make changes at the outset by employee categories."

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