Corporate Cash Plans
Overview
Business in the healthcare cash plan market is increasingly focused on the corporate sector as employers and individuals look to these products as a cheaper alternative to private medical insurance (PMI).
The market is battling a lack of general awareness of what healthcare cash plans are and the very fact they exist. This may change as more employers search for ways to ensure they meet any obligations to support employee health and wellbeing. Certainly, the development of healthcare cash plan products reflects the market's focus on benefits such as help lines and other occupational health services.
Healthcare cash plan providers are not satisfied with garnering the crumbs from the PMI table and are recognising the demands of the market for a more proactive approach to healthcare. One could argue they were always ahead of the game on this one anyway, making sure cost was not a deterrent to individuals in obtaining eye and dental checkups. But the marketing approach is becoming more aggressive and centered around helping employers to keep their staff fit, healthy and working.
Traditionally employers have offered access to the perk with employees paying for it, however, they now appear to be increasingly willing to fully fund healthcare cash plans for staff. There is an increasing pressure on employers to put together an impressive package of benefits. There are all the issues associated with absenteeism, stress in the workplace. Healthcare cash plans include product features that help people get back to work quickly.
The Facts: What are healthcare cash plans?
Healthcare cash plans make lump sum payments out to the holder to pay for treatments, such as eye tests, dental care, some complementary therapies and expenses for stays in hospitals. Premiums are usually low and payouts will cover approximately 50% to 100% of the cost of treatment, up to a set overall limit.
What are the origins of healthcare cash plans?
The origin of healthcare cash plans can be traced back to hospital contributory schemes, established in the late 1800s before the National Health Service (NHS) came into being. These raised small weekly contributions from the public to help fund hospitals. Post-NHS some of these schemes remained providing low-cost benefits to the lower working classes. Many providers are still not-for-profit and charitable organisations.
Nitty Gritty: What are the costs involved
Most providers offer plans that can cost from ¨£1 per week up to about ¨£5 a week depending on the level of cover. Some flexible plans now offer a wider range of occupational health benefits.
What are the legal implications?
If anything, because employers have a responsibility to ensure the health and wellbeing of their employees under the Health and Safety at Work Act, it could be argued healthcare cash plans help to meet this obligation.
What are the tax issues?
Healthcare cash plans are a taxable benefit if employers pay the premium. If employees are paying it, the premium is not taxed because they are paying out of taxed earnings. Lump sum cash payments are tax free to the individual.
We work closely with Healthshield Friendly Society for the provisions of Corporate Cash Plans and we would be delighted to discuss the benefits for you and your employees of setting up a Cash Plan programme.
Please visit the Healthshield website to find out further information about their Corporate Cash Plan
www.healthshield.co.uk
Business in the healthcare cash plan market is increasingly focused on the corporate sector as employers and individuals look to these products as a cheaper alternative to private medical insurance (PMI).
The market is battling a lack of general awareness of what healthcare cash plans are and the very fact they exist. This may change as more employers search for ways to ensure they meet any obligations to support employee health and wellbeing. Certainly, the development of healthcare cash plan products reflects the market's focus on benefits such as help lines and other occupational health services.
Healthcare cash plan providers are not satisfied with garnering the crumbs from the PMI table and are recognising the demands of the market for a more proactive approach to healthcare. One could argue they were always ahead of the game on this one anyway, making sure cost was not a deterrent to individuals in obtaining eye and dental checkups. But the marketing approach is becoming more aggressive and centered around helping employers to keep their staff fit, healthy and working.
Traditionally employers have offered access to the perk with employees paying for it, however, they now appear to be increasingly willing to fully fund healthcare cash plans for staff. There is an increasing pressure on employers to put together an impressive package of benefits. There are all the issues associated with absenteeism, stress in the workplace. Healthcare cash plans include product features that help people get back to work quickly.