A PAIN IN THE WALLET
Simon Courtauld argues that our
our biggest health insurance company is losing its touch
'SIT BACK and relax,' Bupa's leaflet told me, 'your membership will be renewed automatically at the same level of cover . . . Nothing could be easier.' But I sat up and became very unrelaxed when I saw by how much my premiums for private health insurance were being increased. From September, the amount payable for myself, my wife and my daughter went up by over 20 per cent; the premium for my son (aged 19 and separately covered) increased by 34 per cent.
I rang Bupa, to be told that there had been a lot of claims last year, and 'we got our sums a bit wrong'. In addition to the general premium increase, the young per- sons' discount, for instance, had been reduced. So the British United Provident Association, founded in 1947 'with the overriding aim of looking after our mem- bers' interests and meeting their health- care needs', has decided, in the middle of a recession, that those members must suffer. Is this providence?
Bupa boasts in its literature that 'in 1991 we paid out for more claims than ever before, totalling over £700 million. For every £1 we received, 90p was paid back to our members in benefit.' But Bupa intends to make sure that this doesn't ever happen again. A spokesperson said that premiums were `too low' in 1991 and that the rules had been rewritten at the beginning of this year — for example, to restrict the scale of pay-outs for 'mental and addictive illness- es' and to stop paying for hormone replacement therapy. The record number of claims was thought to have included a number of people who feared they might be made redundant and had therefore decided to have treatment under their company policy while their jobs lasted. This year, for the first time, Bupa has suf- fered a net drop in membership of 6 per cent. With 3 million members, this means that rather more than 180,000 people are now looking elsewhere, or taking their chance with the National Health Service.
In terms of market share, Bupa still has nearly 50 per cent of private health insur- ance business, followed by Private Patients Plan with 25 per cent and the Western 'I didn't say it was a vision of the Blessed Mother, I said it was a vision of my blessed mother.' Provident Association with about 6 per cent. Then there are life assurance compa- nies — such as the Norwich Union, Sun Alliance and Eagle Star — which have entered the market only in the past two years. As composite insurers they have a large pool from which to lure new health subscribers, so long as their policies are competitive.
As a disenchanted Bupa person, I am now shopping around. The Norwich Union, for instance, which claims over 100,000 new health subscribers in the past year, has a comprehensive policy which would cost me 25 per cent less than Bupa's, and one of the Sun Alliance policies would be even cheap- er. But there are, of course, different con- ditions, exclusions and monetary limits attached to each policy which make direct comparison difficult.
However, without going into too much detail here, I have already reached the con- clusion that Bupa offers considerably less than a good deal. Not long before his death, Jock Bruce-Gardyne wrote a memo- rable article in the Daily Telegraph, point- ing out that Bupa does not always meet its claim that it 'will cover your costs'. He acknowledged that he did not subscribe to Bupa's most expensive contract, but said that, even if he had, he was entitled to only one brain scan a year. Unfortunately Jock's tumorous brain had needed two.
But even on a 'comprehensive' policy, I have discovered, Bupa will pay surgeons', anaesthetists' and physicians' fees only up to a certain limit. This may be thought quite reasonable — those doctors charge more than enough anyway — until you learn that the Sun Alliance has no such limits (on its Group Health Plus policy) and that the Norwich Union will pay fees up to the levels recommended by the British Medical Association. Bupa sets its own limits somewhat below the BMA guidelines. (It also takes a notoriously long time to settle the doctors' bills.) Bupa is unquestionably lagging behind in an increasingly competitive market. The point seems to be confirmed by its current half-page advertisements for Healthchoice in the national press, showing an odd assortment of people of different ages, all awkwardly flexing their biceps and trying to look healthy. But they may not feel so good when confronted with their next Bupa pre- mium increases. In the current issue of its members' magazine, Upbeat, Bupa admits to increases of 20 per cent and more this year, while announcing on the cover, beneath a happy family picture, 'The Value of Membership: Keeping the Cost Down'. While looking for alternative cover, I twice asked Bupa some weeks ago to send me details of their Healthchoice and Bud- get plans. I am still waiting for the informa- tion. When I rang to cancel my policy, was not asked why, nor whether I would like to consider Bupa's other options. yr afraid that, for the Courtauld family, it s Bupa and out.
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