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Bridging the healthcare gap

27 May 2015

PMI Health Group director Mike Blake considers the fallout of cuts in NHS provision and the options for tackling the rising risk of absenteeism.

Linked to an ageing population, the NHS faces mounting pressures and an unprecedented demand for care. There have been widespread reports of treatments being cut in recent times, particularly those regarded as low priority, and this trend looks set to continue.

NHS England’s chief executive Simon Stevens has claimed an extra £8billion a year would be needed by 2020 to close an anticipated £30bn gap in NHS finances. Alarmingly, from a business perspective, many of the cuts to date have been in procedures and services that risk directly impacting employee absence rates.

The frontline impact of cost savings

Stress and mental illness is now the number one cause of workplace absence, responsible for more than half of all working days being lost every year. But according to the Royal College of Nursing (RCN), there are now 3300 fewer mental health nursing posts, and 1500 fewer beds, than there were in 2010. All the while, demand has increased by 30%.

A coalition of leading charities and medical professionals reported late last year that one in 10 patients are waiting for more than a year just to be assessed for mental health treatment, and one in six have made an attempt on their life while on a waiting list.

Hot on the coat tails of stress and mental illness, musculoskeletal disorders are held to be the next biggest causes of UK employee sickness absence. Increased waiting times for treatments in this area have also been widely reported however, whether for hands-on physiotherapy or routine orthopaedic operations.

Faced with a potential void in employee healthcare, businesses may have to seriously consider options to fund these treatments themselves. But if they are funded by employers on a case-by-case basis, this means having to contend with a benefit-in-kind tax liability on the cost of all such treatments.

The introduction of employee benefit schemes to cover these treatments may be a more logical option. Indeed, research by PMI Health Group revealed that two fifths of employees feel health and welfare benefits have increased in importance as a consequence of NHS cuts.

An array of employee benefits can guard against gaps in state healthcare provision. Companies’ own budgetary constraints mean that only a small percentage of businesses can provide private medical insurance (PMI) to all their employees. Nevertheless, insurers have taken an innovative approach to health cover in recent years with flexible hybrid schemes offering an inclusive, cost effective, alternative. In some cases, schemes have been deliberately structured to directly tackle musculoskeletal and mental health conditions.

Confidential employee support

EAPs have a particular focus on tackling mental health, providing staff with access to dedicated telephone support lines that enable them to speak with trained counsellors at any time of the day or week. What’s more, they represent a company’s commitment to taking preventative and protective measures to reduce health risks in the workplace, in line with the Health & Safety at Work Act of 1974.

CBT, for example, can facilitate returns to the work with referrals offered to staff, not only through PMI or employee assistance programmes (EAPs) but also through other schemes such as income protection.

Similarly, cash plans offer a low cost benefit with high perceived value, incorporating benefits to help address a range conditions associated with absence, such as physiotherapy and chiropractic. Higher end cash plan benefits can even provide cover for high-tech scans and online health risk assessments.

By providing such benefits, companies will not only foster staff loyalty and position themselves as employers of choice, but tax will also be levied more cost-effectively on the benefit premiums.

The challenges posed by the shifting healthcare landscape can be met, but employers should be readying themselves now to minimise the business cost.