Private medical insurance or PMI, is not always as easy to understand as other insurance products. It is a very specific type of insurance, for very specific needs and in a country such as the UK where the NHS is an excellent system compared to some other country's government controlled health systems, there has to be a good balance.
Private medical insurance products core services work alongside those of the NHS with health insurance products focusing on treatment for acute conditions where the National Health Service will still provide accident and emergency and the treatment of long term chronic conditions.
Private health insurance in the UK is essentially designed to enhance the services on offer through the NHS. It really comes into its own where surgical or specialist care is hard to secure in a timely fashion - the NHS often has long waiting periods. PMI accesses medical treatment and care selectively, faster and in greater comfort - nationwide.
Like all insurance products, PMI varies from provider to provider and product to product. An independent health insurance specialist is the best person to outline the products as well as identify needs.
Health Insurance Cost Assessment
The costs in terms of premiums for PMI are assessed based like most insurance, on overall risk. Key factors are derived by insurance underwriters from national statistics of medical conditions prevalent in the UK. These conditions range from cancer to back problems.
This risk assessment assimilates the chance of contracting illness on the part of each insured individual. For this reason the policies are medically underwritten with the policyholder either agreeing to declare their full medical history or agreeing to conditions which have recently required treatment not being covered under the plan.
How Private Medical Insurance Works
Legally speaking a PMI policy is a binding contract between two parties. The level of cover and cost obligations are agreed to in advance and only then the contract is signed. Payment is made by the policy holder or his/her employers and payments are generally monthly, although they can also be quarterly or annual, in which case additional discounts may be available.
There are many options to consider when considering a private health insurance plan and it is important to understand what these options are, the cover provided and the cost. Most policies are made up of inpatient treatment and outpatient treatment with a number useful additional benefits also included within the plan. A most basic plan may only cover inpatient treatment where a mid range plan may in addition provide a level of outpatient treatment which is limited by a monetary amount. Your most comprehensive plan is likely to cover both your inpatient treatment and outpatient treatment in full.
Some of the key options that you should be aware of and consider are detailed below.
Excess is a regular cost saving feature of a personal health insurance policy, which means an initial payment of varying degree must be made by the policy-holder before claims are processed and paid on their behalf. Obviously this also means that a claim should be viable on the part of the policy holder, before they actually pay an excess and claim.
Co-payment - this is another type of excess which may or may not be included in a PMI policy. Again, it is a cost saving feature which generally applicable only for frequent visits or particular services.
Whether you are looking for a personal plan for you or your family or are reviewing the terms of your corporate pmi policy make sure you are familiar with terms such as; exclusions, coverage limits, underwriting (although we did explain this briefly), moratorium, full medical underwriting (FMU), moratorium underwriting (for pre-existing conditions), out-of-pocket maximums, capitation and prior authorization.
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