Gallagher Employee Benefits: Bupa is “probably right”
Bupa has removed 25 BMI Healthcare hospitals from its list of approved facilities, in addition to the 12 announced earlier this month.
The insurer has apologised for the inconvenience caused by the action, but argues that it is “vital to maintain and improve the affordability of private healthcare for our members”.
Bupa’s current contract with the UK’s largest private hospital group expires at the end of this month and a new one has yet to be signed. Bupa argues that the prices offered by BMI Healthcare are unreasonable while BMI Healthcare has claimed that a reduction in its rates could compromise care and would be unlikely to be passed on to Bupa customers in the form of lower premiums.
The de-listing of the 37 hospitals was prompted by BMI Healthcare’s failure to provide out-of-contract pricing, according to Bupa. The insurer argues that it is seeking to ensure that members are not charged “unduly high rates” at BMI healthcare hospitals next year.
Not all BMI Healthcare facilities have been removed from Bupa’s list. The insurer has de-listed those that it believes to be in areas with “reasonable alternative arrangements” – defined as hospitals within a 30 minute drive of the de-listed facility.
Bupa said that discussions with BMI Healthcare are ongoing and that it hopes to return the group’s hospitals to its list of recognised facilities “if we are able to agree appropriate commercial terms”. It is “confident” that it can come to an agreement with the hospital group.
Bupa has also confirmed that it is prepared to consider requests for members to use BMI hospitals on an out-of-network basis, with the member paying the shortfall. Bupa will also cover consultations at de-listed hospitals, but not the cost of any procedures, including diagnostic tests.
It is writing to members it has previously contacted about BMI Healthcare to update them on the action and to those who have pre-authorised treatment at one of the 37 hospitals in recent weeks. However, it said that contacting other customers would be “disproportionate” at this stage, given that they will be advised by member service advisors if affected in future.
Bupa estimates that around 3 per1,000 members every month receive treatment at one of the 37 hospitals. Bupa customers mid-treatment will “not be affected in any way”, Bupa said. The insurer will continue to fund treatment at the same hospital into 2012.
Karen Gamble of Gallagher Employee Benefits said that Bupa was “probably right” to take the action
“Someone does have to take a stand against overcharging or even just regular pricing increases,” she said. “And Bupa of all of the insurers has the biggest issue with shortfalls. The OFT has helped their cause by commenting on the obtuseness of this market.”
However, she said that she wished that Bupa had given advisers more notice.
“The problem we intermediaries face is the challenge of explaining their position and identifying how it could impact on each and every Bupa client,” she said. “In some areas of the country de-listing the local BMI hospital is a real challenge, in other areas it’s not too bad. It does reinforce to our clients that we do have expertise and add value as we can help them through this.”
List of 37 hospitals to be de-listed in 2012