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In the face of significant volatility UK healthcare needs to innovate

Published: 23/10/2023

To remain sustainable and meet the changing needs of society, the PMI sector will need to adapt and innovate, writes Dr Keith Klintworth, Managing Director VitalityHealth.

Against the backdrop of a struggling economy, our nation is getting less healthy. Recent estimates suggest that over nine million people in the UK will be living in poor health by 20401.

Declining productivity, driven by an ageing population and growing burden of disease caused by lifestyle risks, will place even greater demand on public health systems globally.

In the aftermath of the pandemic, our national health service is still under pressure, while high inflation is also continuing to impact medical costs and putting strain on healthcare as a whole2.

Growing demand for health insurance

Alongside this, more people are turning to health insurance. In 2021, the private medical insurance (PMI) industry experienced its biggest growth since the mid-’90s and demand has remained high3.

Consumer attitudes to private healthcare more broadly are also shifting. Recent findings highlight that consumers feel more positive about private healthcare, indicating a significant generational shift, with younger people increasingly opting to use private healthcare4.

The UK is also seeing growing rates of lifestyle related ill-health and preventable diseases5, as well as a deteriorating population mental wellbeing, particularly amongst younger people6. With poor health impacting productivity7, the economic consequences of these trends for society more broadly are adding up.

At the same time, consumer needs are also changing, with people turning to health insurance to access a broader range of healthcare services, beyond the traditional access to private hospital treatment for major conditions.

To remain sustainable and continue to deliver the best outcomes for consumers, as the healthcare landscape continues to shift, it’s clear the sector needs to continue to adapt and innovate to meet growing demand.

Moving the PMI market forward

Demand for the now commonplace digital GP service, which we were the first to introduce to the PMI market in 2015, has continued to snowball. Difficulty accessing NHS GP appointments is seen as the second biggest consideration for first-time PMI buyers, according to recent Vitality research.

For many years, our products have also sought to incentivise better health and provide earlier intervention through everyday care in order to improve health outcomes for our members.

Almost 60% of our health claims are now made up by these everyday care benefits8, which include Vitality GP, Talking Therapies, Physiotherapy and Optical, Dental and Hearing benefits.

In recent years, we have also developed new digital pathways to enable easier access to treatment, particularly with the introduction of our Care Hub in 2021.

By building a deep integration between the Vitality GP app and our onward care journey, we are now able to deliver a more seamless end-to-end digital care journey and provide faster access to care.

The next generation of health insurance

Our next generation approach to health insurance has resonated strongly in recent years and the data published in our latest Health Claims and Insights Report is proving it works.

Our member base, which reached 1.7 million in 2022, offers a rich dataset that reflects a model delivering profound results.

Through a focus on prevention and early intervention we see up to a 29% lower risk of hospitalisation for members who are highly engaged in the Vitality Programme9.

Our expanded access to Talking Therapies, following our decision last year to disregard medical history for all members using our in-network Talking Therapies, is helping to reduce mental health costs through earlier intervention. Despite a rise in use of Talking Therapies, actual mental health costs have reduced by 32% since 2019 and 99% of members that use Talking Therapies require no further treatment10.

Elsewhere, our data-driven approach to consultant recommendations and our Premier Consultant panel ensures members have 60% shorter hospital stays and 42% lower readmission rates11.

Overall, this more sustainable approach to health insurance is helping to deliver improved treatment outcomes and lower healthcare costs, through enhanced screening services and more transparent, better quality consultant care.

We believe this provides health insurers and advisers with a unique opportunity to make a meaningful impact on people’s lives – before, during and after claim. Not only that – though incentivising positive lifestyle choices and preventing illness from occurring in the first place – we’re able to help create a healthier society at a time when this is needed more so than ever.

To find out more about how Vitality supported clients in 2022 through innovative, forward-thinking health insurance and our recommendations for how the industry can rise to the wider health challenges we face, click below to read our latest Vitality Health Claims and Insights Report:

Where to next?

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1 2.5 million more people in England projected to be living with major illness by 2040 (
Higher inflation to erode NHS spending power | Nuffield Trust
LaingBuisson Health Cover report 18 Edition
New research published - Going Private (
Rising demand for mental health care - Care Quality Commission (
Health is wealth?
8 VitalityHealth Claims and Insights Report 2023
9 VitalityHealth Claims and Insights Report 2023
10 VitalityHealth Claims and Insights Report 2023
11 VitalityHealth Claims and Insights Report 2023