The corporate cash plan market has grown for the fifth consecutive years, with 14.5 per cent increase in the number of employees covered on paid-for corporate plans, according to figures from Corporate Adviser’s Cash & Dental Plans 2024 report. CLICK FOR YOUR COPY.
More than 1.6m employees are now covered on paid-for corporate cash plans, rising to more than 2m people if family members and dependents are also taken into account. The report found Medicash covers the highest number of employees in the UK covering 483,881 staff on paid-for corporate cash plans. It has also seen the biggest year-on-year growth in terms of number of employees covered. Simplyhealth has the highest number of voluntary-paid plans, where costs are paid by the employee with 161,020 policies.
The report found that the rate of claims paid on cash plans has remained relatively unchanged, with a claims ratio of around 1.4 claims per employee. This remains below typical claims ratios seen prior to the pandemic. The average time taken to pay claims has reduced with most providers now processing claims in one to three days.
Qualitative research with advisers pointed to steep prices increases across the sector, although say many employers are absorbing higher costs in most cases, particularly when linked to increased usage by staff.
The report shows there has been a growth in modular products, allowing employers to strip out added value benefits to reduce cost and duplication of services.
Dental remains the most claimed for benefit with all provicers, accounting for around a third of all claims – with three quarter of all cash plan claims being for dental optical and therapy (physio, chiropody and complementary therapy) claims.
Virtual GPs remain the most highly-rated, and most used added-value support service. Most cash plan providers now use HealthHero to deliver this service. Advisers report that increased demand has led to longer wait times for some of these support services, particularly counselling services and virtual GP The report found advisers want to see more focus on neurodiversity support and screening in future benefit packages, and want all cash plan providers to provide a menu of benefits and better MI particularly reading claims on the scheme to give more certainty around future premium increases.
Corporate Adviser Intelligence head of research John Greenwood says: “Cash plans continue to play a vital role in supporting the heath and wellbeing of millions of employees during a period which has seen many struggle to access primary healthcare services: from GP appointments to dental services and mental health support.
“For employees these often overlooked products have offered welcome financial help with everyday healthcare costs during a cost-of-living crisis. For the employer they remain an important element within the wider employee benefit toolkit when it comes to addressing a growing ‘sick note culture’ and the problem of absenteeism in the workplace — particularly in relation to mental health.
“Against this background it is not hard to see why sales of corporate cash plans continued to grow in 2023. This report offers a comprehensive overview of this market, with analysis of the market coverage, proposition and payout ratios of the leading cash plan providers.”