Personal finance: Hospitals lure self-payers

Fixed prices for private patients are the bait. By Andy Couchman

IT USED to be the preserve of people with either the prescience and luck to be insured or rich beyond the dreams of avarice. No longer. BUPA last week launched a campaign aimed at encouraging those without cover to use its hospitals anyway. And in true PR style, prospective punters are being told that paying can be in their best financial interests.

With NHS waiting lists at almost 1.3 million (up 120,000 since the election despite the recent fall of 21,000) more people are looking to the private sector to meet their needs. As many as a third of all hip replacements and a quarter of coronary artery by-pass grafts are now carried out in independent hospitals.

Self-pay, as it is known, is also on the up - about 20 per cent of all independent hospital patients, according to David Lucas, executive director of the Independent Healthcare Association, which represents private hospitals and care homes.

Mr Lucas dismisses the notion that most are simply queue jumping. He says: "Many people who run businesses simply cannot afford to wait for NHS treatment. A lot of elderly people too are not prepared to lose their quality of life and would rather have a bit less in the bank. Self pay actually helps the NHS by freeing up beds."

Self pay is, for many, an alternative to private medical insurance. A lot of policies exclude pre-existing conditions.

Premium rises in excess of inflation have also priced out many. The removal of tax relief for the over 60s last July has added to the problem.

Many elderly people pay more than pounds 1,000 a year for cover - equivalent to a hip replacement every six years.

One fear in the past was that, if complications arose, patients could find themselves paying substantially more than they expected. BUPA and others get round that by offering fixed prices for a range of surgical procedures to 95 per cent of self-pay patients. For the remaining 5 per cent, the cost would still be fixed up-front but may be higher.

Most patients will access the service either direct or through their doctor, with many already awaiting NHS treatment when they decide to self pay. In recent years many hospitals have upgraded their facilities. Heart by-passes, once exclusive to NHS hospitals, can now be performed in many larger independent hospitals.

The growing use of keyhole surgery is another reason why self-pay is becoming popular, according to Nuffield Hospitals spokesman Ron Finlay. Many procedures, including hernia repair and cataracts and even hysterectomy, can be carried out without an expensive overnight stay.

Self pay has grown by 20-25 per cent a year at Nuffield's 38 hospitals and is increasing.

Loans can spread the cost. BUPA typically charges 18.8 per cent for loans of pounds 2,500 to pounds 7,000 while Nuffield offers 0 per cent finance on some procedures.

More than eight out of 10 people still prefer to use the NHS but for so-called elective surgery, self-pay is a necessary alternative for many.

Andy Couchman is publishing editor of HealthCare Insurance Report.

Example Self-Pay Costs At BUPA Hospitals:

Procedure Cost

Cataract pounds 1,800 - pounds 2,000

Hip replacement pounds 5,500 - pounds 6,200

Knee replacement pounds 6,500 - pounds 7,500

Hernia pounds 1,250 - pounds 1,450

Prostate pounds 2,650 - pounds 3,100

Wisdom teeth pounds 950 - pounds 1,100

Varicose veins pounds 1,250 - pounds 1,450

Hysteroscopy pounds 950 - pounds 1,100

Vasectomy pounds 325 - pounds 375

Coronary artery by-pass graft pounds 9,600 - pounds 12,300