Why healthcare does not have to be a top tier benefit

Renewal season sparks the same conversation every time. The premium is up, the budget isn't, and somebody asks whether it's time to review eligibility. For Gina Neale of Ciphr Benefits, the answer starts with the policy itself.

Private medical insurance (PMI) can be one of the largest spends in a health and wellbeing budget, so it's the right place to start. But it isn't something you buy and leave alone. A policy is a series of design decisions, some of which can change the price without making the benefit less useful.

The cost pressure is real

WTW projected UK medical costs to rise by 10% in 2026, following a 10.6% increase in 2025. Add persistent NHS pressures and higher employer National Insurance, and budgets are squeezed from several directions.

The temptation is to reduce eligibility, but there are other places to look first.

Four things you can change:

The excess: Raising the employee contribution towards a claim can reduce the premium.
The hospital list: The widest lists include major private hospitals in central London and cost more. If your workforce is elsewhere, you may be paying for access few employees will use.
How employees get referred: Some policies let employees choose any consultant; others use an approved network, which can reduce costs.
The six-week option: Some policies offer a lower-cost option where private treatment is available when the NHS cannot provide it within six weeks. Terms vary, but it's worth considering.

The point isn't to strip a policy back as far as possible, but to understand which design choices affect cost, and which affect employees.

What the savings could buy

Where budgets are tight, the usual response is to give higher cover to a smaller group. Another is to provide more focused cover to more employees, with individuals paying for additional options themselves.

That changes the question from how much PMI you can afford to how much of your workforce you can reach. Someone who wants wider cover upgrades at their own cost. Someone content with core cover stops paying for features they'll never use. And the eligibility conversation stops being about who is senior enough and starts being about what level of support everyone gets.

It won't suit every organisation. Eligibility, underwriting and tax treatment all need checking, and the flex arrangement has to be simple enough that employees engage with it. But it's worth putting on the table before narrowing eligibility wins by default.

Don’t go overboard with the cutting

Strip a policy right back and you can be left with inpatient treatment and cancer care, losing cover for consultations, blood tests and scans.

At the end of July, 6.21 million patients were waiting for treatment on the NHS, with about 111,000 waiting over a year.

Against that backdrop, a policy that only becomes useful once someone needs a hospital stay can miss an opportunity for earlier investigation and treatment.

Look at the wider healthcare offer

When Ciphr asked 2,000 UK employees which of 48 benefits mattered to them, paid sick leave came first at 68%. Private health insurance was valued by 37%, ranking joint tenth, mental health and wellbeing support by 35%, and private GP access by 29%.

Healthcare value isn't limited to PMI. Core PMI alongside private GP access, mental health support and physiotherapy may reach more needs than putting the whole budget into premium cover.

It's also worth checking for duplication. Employers can pay separately for services already included elsewhere in their healthcare provision.

Prevention matters too. Health assessments, screening and digital tools may already sit inside your healthcare package, but they only work if employees know they exist.

Technology can also open the door to support, but it’s clear communication that gets people through it, by showing what’s available, why it matters and when to use it.

Start with the workforce, not the policy

The REBA Health and Wellbeing Research (2026) found that just 9% of employers have integrated their health benefits into a single continuous journey. For many organisations, provision has developed piece by piece, with individual benefits and cover levels added over time. That makes renewal the moment to look at everything, not just the quote in front of you.

Before the next renewal, ask:

Which parts of our policy are employees actually using?
Are we paying for cover with little relevance to our people?
Could a different level of cover let us extend the benefit further?
Are any services duplicated?

Do employees understand what healthcare support is available to them, and when to use it?

A premium policy can matter, but employees don't experience policy features. They experience advice, diagnosis and treatment when they need it.

Healthcare doesn't have to be top tier to be valuable, but it does need to be relevant, accessible and designed around the people who'll use it.