In response to my recent blog about “gap” invoices being increasingly used to mitigate fee reduction(s) imposed on consultant surgeons, many expressed a negative view.
It is of no surprise the vast majority who disagreed work for insurance companies.
Some were quite vocal in the dislike of “gap” invoices and firmly of the opinion cost extraction was the ONLY way to reduce the cost of premiums and thus make the private health insurance offering more attractive. Faced with a smaller number of potential or existing policy holders, insurance companies have sought to make the private medical insurance offering more attractive by making it cheaper.
But is cost extraction really the only way to make private medical insurance more attractive?
The implication of such an insurance company held view, confirms their belief that price is the single factor when a patient takes out private insurance and GAP invoices, being diametrically opposed to that aim, should be resisted. However, are patients really that fixated by cost or are there other factors they consider when taking out private medical insurance?
Some patients are happy to pay Gap invoices which suggests cost is not the only factor. Some are completely unaware of the fee reductions being imposed on their consultant of choice.
So are they really, really that concerned with cost?
To a certain extent of course they are. All patients in search of a package with a private hospital, for example, will be price conscious. However, that may not be the overriding factor when a patient takes out private insurance. Whilst they will certainly be looking for a value for money, it is more likely the perceived value contained within the package is more of a driver than just the cost.
Deeply involved in the perceived value of package is the reason the patient wants to be seen privately on the first place.
The prime reason a patient takes out private insurance is that they wish to be seen as quickly as possible, as conveniently as possible and by the consultant they wish to see.
Yet insurance companies seem to be almost fixated with taking cost out of the private insurance market. Seldom do they seem to be interested in what else the patient is seeking from his/her cover. Seldom do they emphasise that a patient with private medical insurance can be seen quicker and more conveniently.
Private health care is deemed to be expensive. Whether it is or not is actually secondary. What is more relevant is the perception that it is. So the insurance companies react by trying to take cost out and begin a race to the lowest fee or a race to the bottom if you will, sometimes shifting the emphasis away what the patient really wants – to be seen not only at a reasonable cost but as quickly and conveniently as possible.
Keep reducing fees and sooner or later the fees will be so low neither the private hospital or the private consultant can make a reasonable return on their work.
Add in the factor of a diminishing number of patients who take out private medical insurance – there are fewer people who have private medical insurance now than at any time since the early 90s – and consistently reducing costs in search of a smaller pool of potential patients creates almost a perfect storm.
All of my clients have substantial NHS obligations which, incidentally, they perform to exactly the same skill level as their private work. They are hard wired to perform both in the best possible way. So why does an NHS patient ask an MHM client if the consultant can see them privately?
Because they don’t want to wait.
By no means does that suggest a patient will pay any price to see their consultant of choice. They want to see their consultant of choice and and the most convenient time to themselves. They do not, for whatsoever reason, want to wait
So why is it that insurance companies concentrate so much on taking cost out of the private healthcare offering, whilst almost failing to point out that private medical insurance offers rapid convenient access to a high level of facilities and a choice of whom the patient may see.
Doesn’t the existence and acceptance of GAP invoices, actually suggest that patients are prepared to pay more and not less to see a consultant as soon as they possibly can and where they wish?