Bupa enforces Open Referral for all corporate clients

Britain's largest PMI provider launches controversial shake-up

All Bupa's Corporate Select customers will have to choose from a list of consultants selected by Bupa, from January 2012, the insurer has announced, in a move that represents a huge shake-up of the private medical insurance (PMI) market.

The Open Referrals process means that, instead of referring these patients directly to a consultant, GPs will have to provide them with an open referral (a referral for a procedure with no named consultant).

The member will then call Bupa to pre-authorise the diagnostic procedure or treatment they need and, provided this is covered by the policy, they will be provided with a choice of consultants at nearby hospitals. The member can then book their consultant appointment.

The change was announced in an email to intermediaries last Friday morning. The communication, from Linda Wallace, head of intermediary sales, says that the process has been developed in response to feedback from customers "expressing a desire for Bupa Health and Wellbeing to continue to develop innovative solutions to improve the overall quality of care our members can access, while at the same time leading the market by seeking opportunities to combat the rising cost of medical inflation and deliver sustainable costs."

Communication with intermediaries

Some intermediaries expressed shock at the announcement. Karen Gamble of Gallagher Employee Benefits said that no information about the change had reached her firm.

"Apart from what I think about the system and its good points and bad points, the main thing is the way they are treating intermediaries," she said.

Colin Boxall of ADVO Group also said that the firm had not received any information about Open Referral. On contacting Bupa's sales team he found "no information available and little awareness" while Member Services were "a little forthcoming in that this was something they are trialling."

"Good quality PMI should be about having choice and control in difficult circumstances," he said. "Obviously this has to be balanced with practicality and cost. Anything that improves the customer experience and eliminates shortfalls should be welcomed but I would expect advance notice and consultation to ensure this 'treats customers fairly' before changes are imposed."

'Exciting development'

Although Wallace describes Open Referral in her email as an "exciting development", it is likely to be opposed by doctors who will view it as another attempt to interfere in the referral process and reduce choice. Bupa has previously created networks of providers and reviewed referrals before approving them, arguing that its role is to secure value for money on behalf of its members by tackling unexplained variation in pricing by providers. The process, which will apply to both outpatient and inpatient care, is likely to result in fewer patients receiving treatment in central London hospitals, which Bupa claims costs around a third more than outside London.

A presentation accompanying Friday's email says that Open Referral has been developed to tackle "high variation in clinical practice between many specialists", the fact that "most GP referrals are made without using any data on quality or value of specialist", "unsustainable cost inflation for employers" and requests from patients for "some sort of guidance around who they should see". 

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