BUPA Insurance Roadshow

On the 16th February 2000 BUPA Insurance held one of its Roadshows at the Commonwealth Conference Centre in Kensington, London. Although billed to the consultants as "Implementation of the Relative Values Review and Clinical Governance and the Private Sector" there was actually very little of substance said about the Relative Value Review. Mr. Keith Biddlestone of BUPA Insurance stated that Relative Value Review was still under discussion and the implementation date was uncertain. There are obviously areas of difficulty, particularly with the anaesthetists and some consultants in the audience felt that the current proposals for patient reimbursement for anaesthesia may possibly be inappropriate. Mr. Biddlestone indicated that there would be some overall increased reimbursement to patients for consultant's fees and that no specific reimbursements would fall. However, this matter had not been resolved. Under further direct questioning he admitted that the present coding system for procedures was inadequate and led to difficulties and anomalies in interpretation and thus fee reimbursements.

The main thrust of this meeting, however, was a presentation by Mr. Keith Biddlestone and a medical colleague from BUPA Insurance about the company's strategy for the future. Apart from reiterating the well-known fact that the private medical insurance market has not expanded recently there was little new in the presentation. BUPA Insurance have to be congratulated on their honesty in presenting their own surveys of satisfaction ratings which showed that on all aspects of the survey BUPA Insurance were rated worst out of the four major insurers namely BUPA Insurance, PPP, Norwich Union and WPA. PPP has dropped sharply of late (possibly due to the new direction being taken under AXA ownership) whilst interestingly, WPA scored highest in satisfaction on all parameters measured. These findings confirm the LCA's own survey of 204 consultants published last year and available [ HERE ]. A member of the audience suggested that WPA came out so well due to adherence to traditional and efficient patterns of insurance and a lack of networks and interference with the consultant. Mr Biddlestone felt that market forces may eventually force a change in WPA policy.

In terms of future market expansion and strategy the consultants were sorry to find that BUPA Insurance have not shown greater imagination in producing new products. The long term fixed rate policy (whereby a subscriber may pay BUPA Insurance a large lump sum for a fixed 5-year insurance) did not seem likely to be a popular option, at least to the audience. The general BUPA Insurance policy is one of cost saving and retrenchment, in the face of increased patient claims. A repeated argument presented by the company that corporate purchasers are constantly demanding improved service and reduced costs is well known as is the fact that these companies will switch their private insurers each year basing their decision only on the premium costs.

For the future BUPA Insurance proposes the concept that a patient should have a simple card, rather like an RAC card, which will allow them to have their treatment and never see any account from either hospital or consultant. This may well appeal to some patients and corporate customers but it encourages the perception that the insurance company is actually "employing" the consultant and paying their fees. This, of course, is the meaning of the BUPA Insurance Partnership, which will gradually take away from consultants their right of independent fee charging. Ultimately all consultants would become locked into BUPA Insurance rates and with no guaranteed inflationary uplifts or appeals process the consultants would be at the mercy of the insurer. The RAC card concept of health care defies economic reason to the consultants because it makes no allowance for factors such as case variation and background practice expenses. It would leave the consultant totally exposed to the whims of the insurers and the current policy of PPP in refusing to pay surgical follow up consultations or cardiological care are just such examples. The defence is to maintain the consultant's contract with the patient.

The LCA does not condone high or unreasonable charges but firmly believes that consultants should bill their patients directly. This feeling was reiterated by more than one member of the audience at the BUPA Insurance road show. Considerable anxiety was also expressed about electronic billing which BUPA Insurance and other insurers are going to promote. One consultant expressed the view that whilst this may seem superficially attractive it is another manoeuvre that removes responsibility from the patient and encourages the perception that the insurance companies are paying the bill. Mr Biddlestone responded by saying that his surveys had shown high consultant acceptance of the concept but precise figures on this were not given.

In terms of overall profitability consultants were told that the insurance side of BUPA Insurance lost £20 million last year and this year is predicted to lose £10 million. Nevertheless, the provident insurance branch is only a small part of BUPA Insurance which is now a massive international conglomerate. As the BUPA Insurance hospital branch in the UK is a profitable organisation, Mr Biddlestone was questioned by the consultants as to whether BUPA Insurance, being both purchaser and provider, can profit on the hospital side at the expense of the insurance side. Many consultants felt that if this were so they would, in effect, be subsidising the insurance branch by virtue of the fact that their fee reimbursements had not changed in some eight years. Whilst accepting the comment about lack of consultant fee raises Mr. Biddlestone denied that any "favouritism" took place and stated categorically that no special deals or arrangements were extended either way in the companies internal dealings.

Consultants were left with a slightly disillusioned feeling about these issues and on the wider question of new ideas to promote private health care. This is admittedly difficult in the current political climate. On specific questions about the development of private care in areas such as specialised paediatrics or for adults with chronic medical problems there seemed little change in BUPA Insurance's thinking.

The London Consultants' Association would like to see a flourishing private insurance market and wishes BUPA Insurance well. However, the solution of increased partnerships and networks has not worked in the USA where costs and dissatisfaction are rising rapidly. The London Consultants' Association feels that as BUPA Insurance's own surveys indicate considerable dissatisfaction with the company, their present strategy (reflected also by their reduced market share over recent years) needs a more radical reassessment. There are no easy answers!