An example of this is the robotic prostate surgery that is currently being trialled. This uses a tiny robot, controlled by computer by the surgeon, to remove the prostate. This makes the procedure less invasive but also more accurate, which improves survival rates.
It is likely that this technique will become commonplace in other areas of surgery too, pushing costs up as hospitals look to invest in the new technology.
Medical advances do not always mean more expensive treatment either. “New procedures can be significantly cheaper to administer,” says Smith. As an example he points to keyhole surgery, where not only is the cost of surgery lower but the reduction in inpatient stay also helps to reduce the overall cost of the treatment.
From an insurance perspective, it is not simply a case of cost-cutting though. “It’s a balance for the insurer,” adds Smith. “The cost of the treatment may be lower but the reduced risk involved with the new procedure means that it is suitable for more people so the insurer may end up paying out more because of the increased volume in claims.”
So, while cancer may dominate the financial discussions, insurers are mindful that there are other areas where costs could put pressure on future claims funds.
With new drugs coming onto the market, the rising cost of cancer treatment has dominated debate in the medical insurance arena. But, while costs can be high and put immense pressure on the claims funds of companies that experience a claim, the cost of cancer treatment is not the only thing concerning insurers.
“If a corporate scheme has a cancer claim it will affect premiums but it only makes up a small percentage of the total claims paid,” says Marco Bannerman, head of corporate sales at BUPA.
The bulk of claims tend to be for low-cost, high frequency procedures such as treatment for musculoskeletal problems, but, cancer aside, there are a number of conditions that will result in high cost claims.
“We do see some large costs involved when we’re dealing with claims for cardiac, digestive, psychiatric and back pain-related treatment as well as the cancer claims,” adds Bannerman. The unexpected can also lead to large claims.
“It’s infrequent but if there are complications and someone has to go into an intensive treatment unit then it can get very expensive,” says David Costain, medical director at AXA PPP healthcare.
Costs vary, depending on the type of care required, the number of healthcare professionals involved and the length of time, but Costain says it can cost at least £1,000 a night.
Where large claims are concerned, insurers will take a proactive approach to managing costs. Depending on their protocols on costs or the nature of a claim, insurers will deploy case managers to ensure that treatment is appropriate and cost-effective.
“We want to avoid surprises,” says Charlie MacEwan, head of communications at WPA.
“Once we know the treatment is happening we will speak to the consultant and the hospital. This helps to control costs but also enables us to help the patient. For example, we will often call the hospital during the time the patient is admitted as this provides them with reassurance and support.”