Private Healthcare - who has it? should I/do I have to take it?

R.O.S.S.I

R.O.S.S.I

R.O.S.S.I

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Hi all, i've been offered a new job and as part of the package they offer private healthcare and some other life insurance type things too. I've never had a role that has offered this so its all a bit new to me but after speaking to my brother-in-law he said to have a strong think about whether or not to take it as it has tax implications and can mean you end up paying quite a bit more tax.

I don't have the specifics on what the plan/program/entitlements/benefits are yet for the scheme, but I was wondering do many of you on here have private health included with your employment package and if so, what kind of implications this has on your overall tax and take home pay? And also if you have to accept it from an employer?

My brother in law said he didnt accept it from his employer as he didn't think the tax implication was worth it to him and he'd rather just have the extra disposable income. However I understand everyones situation is likely to be different and it will potentially differ quite a lot depending on what your overall salary is.

Anyone with any nuggets of info or anything like that i'd love to hear what your thoughts are.
 
It will definitely be optional. Plans vary so cost would depend on what's covered. They'd always include healthcare (e.g. BUPA) and may also cover dental and optical. Its generally an option to include spouse and children too in the cover (at extra cost).

Mine covers me, the wife and children for healthcare only. According to the last P11D I can see (FY 2020-2021), the cash equivalent is £1721. I'd be interested to see what other pay as I have no idea whether that's competitive or not.
 
If you're young and generally healthy who doesn't get sick regularly you will likely be better off if you save the tax amount on the benefit-in-kind in an investment account (e.g. a global tracker) every month and use it every time you may need a private treatment. This is even more true if you're a higher rate taxpayer as you'd be paying twice as much.
 
R.O.S.S.I said:
I've never had a role that has offered this so its all a bit new to me but after speaking to my brother-in-law he said to have a strong think about whether or not to take it as it has tax implications and can mean you end up paying quite a bit more tax.

I don't have the specifics on what the plan/program/entitlements/benefits are yet for the scheme, but I was wondering do many of you on here have private health included with your employment package and if so, what kind of implications this has on your overall tax and take home pay?
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Oh, people overthink that sort of stuff all the time, the tax implication is basically that you're getting an additional benefit paid for by the company, if you don't take it then there is no tax to pay, if you do take it then you've received something worth say £600 and you'll have to pay 20, 40 or 45% of that amount in tax (as applicable).

The obvious benefit is that it's an extra you didn't have to pay for, you'd have to have paid in full if you'd wanted it as an individual... but in addition to that, as an individual, you might have had to pay way more for the same plan (even more so if you have existing health conditions) whereas your company is bulk buying for potentially hundreds of people and so is usually getting a sweet deal.

So now it could be more like (for the sake of argument) you paying say £240 (40% tax on a £600 benefit - cost to the company) vs having to pay £1000 for the same plan yourself... bargain.

And there's more too, some company plans will allow for pre-existing conditions, individual plans will generally not, making claims with a corporate plan is way easier/less likely to be questioned (they're playing a numbers game), make too many as an individual and they'll become more curious.

Basically, if you're young and healthy then maybe no worries (also for chronic stuff you'll only get the initial diagnosis and acute stuff covered, you can't just have regular checkups covered) but I've found it super useful.

Example for my first claims - I had a bad knee, GP sent me for x-rays at the local hospital and then prescribed a knee support as nothing was broken... that's it initially on the NHS, wait weeks and see if it gets better. As soon as you mention you have private healthcare they'll happily refer you anywhere, no bother to them as the NHS isn't paying/doesn't affect their stats on referrals or whatever. I could see a sports physician (who deals with pro-atheletes etc..) within days, get physio started right away etc...

The impressive thing was the MRI wait time, getting that booked took less than a week and I didn't even have to go to the hospital for it, they had a separate scanning facility in the city so people could simply nip in at lunchtime or during the day to get an MRI done! You can wait several months on the NHS for an MRI for something non-urgent.

So IMO, check the plan, especially things like outpatient allowances ( that covers the appointments/consultations, not treatment* - I've had anything from £2k limit to unlimited) but generally it's been worth it for me.

*that's another thing people seem to get wrong, some people in a place I worked were like "Oh it only covers £2000, no point I'll pay for myself if I need it" they didn't understand what they were reading, the consultants charge say £200 for an appointment, that £200 fee would come out of that... the fee for an MRI (say nearly a grand) or an operation (a few grand with hospital fees and anesthetist fees billed separately etc..) doesn't come out of that limit obviously.
 
I get Aviva cover through work, I'm a higher rate tax payer so it costs me approx £14 a month or roughly a 3rd of what it would cost for me to take a policy out.
For that price it's a no brainer considering the NHS is on its knees.
 
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Yeah I get a healthcare policy through Aviva too.

I also get a death policy 4 x my salary for wife and kids if I decided I'm dead one day.

I did have Bupa Dental care a few years ago but after having all my treatment done in same year I then cancelled it. I need to sign up again as I need some more work and there's no such thing as an NHS dental practice these days, certainly not ones taking any more people on.
 
I'd take it.
It's worth the tax.
I have health insurance as part of my work benefit.
It was a benefit I never used for many years. Then two years ago, at the age of 59, I got cancer. I'm in remission now. However, the health insurance paid ten thousand pounds a month for immunotherapy treatment for 15 months. Yes, it is that expensive.

I'm pleased to say I was not a burden on nhs funds.
 
I'm in the same position as the OP. Just waiting to hear from the company to find out how much the benefit value is and therefore how much it would cost me.

I've just dipped over to the 40% tax rate so I don't think it will be cheap.

I've never considered buying such insurance myself (young(ish) and relatively healthy *touchwood*), but if I could get it for pittance then I would.
 
Thanks guys, some really useful insight here. I'm not sure who the private cover is through so i'm keen to find that out.

In terms of figuring out if its worth it it will largely be a case of me just waiting to see what the cover is and how much the premium/benefit value is to see how much it is going to cost. Should my employer give me an indication of this prior to joining the scheme?

This new job now puts me into the higher tax rate too so i'm wondering what the impact of that will be.
 
Yeh i must admit if it can extend to cover my partner too, not that either of us have any ailments or niggles atm (*touch wood*) then it would definitely make sense.
 
R.O.S.S.I said:
Yeh i must admit if it can extend to cover my partner too, not that either of us have any ailments or niggles atm (*touch wood*) then it would definitely make sense.
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I needed to see an ENT specialist myself and my wife needed some dental surgery. Overall cost was considerably less than going directly private as at least a third of costs were offset by the plan.
 
Terminal_Boy said:
I needed to see an ENT specialist myself and my wife needed some dental surgery. Overall cost was considerably less than going directly private as at least a third of costs were offset by the plan.
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That's odd? At least a third, indicates perhaps you can't say it was at least a half/you paid at least half of the costs?

Generally, insurance I've had has paid for everything save for a £100 excess on the first claim made in any given year and stuff like take-home meds from the hospital etc.. One time a specialist charged a higher consultation fee than the insurer covers but it was only an extra £25 out of pocket to pay.

I've probably claimed a mid-5 figure sum over the years!
 
I didn't think I needed it, but took it anyway, and ended up using it a couple of times. Got seen pretty quickly instead of the months long nhs waiting list.

And a colleague used it for cancer treatment, which would have been a nightmare otherwise. Might have just died without it, will never know.

btw. for those finding themselves in the higher income tax bracket for the first time, increase your pension contributions to bring your income down so you aren't paying 40% tax on any of it, and sets you up better for retirement ofc.
 
I’ve had it for a while and on the times I’ve used it, I’ve been impressed.

I woke up one day with a bad back… NHS physio said it was a sprain but I was in agony. Called the private medical and got a GP appointment within 48hrs and an MRI within the week.

Diagnosed by the end of the following week with 3 slipped discs :eek:

Some have a benefit where you’ll get paid if you need to stay overnight in an NHS hospital (instead of a private hospital). The benefit can vary depending on plan but a colleague of mine got paid £300 a night to stay in an NHS hospital to have an op related to his Chrons… came out a few £k better off!
 
throwaway4372 said:
btw. for those finding themselves in the higher income tax bracket for the first time, increase your pension contributions to bring your income down so you aren't paying 40% tax on any of it, and sets you up better for retirement ofc.
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Thanks for this tip. Once i start and figure out what my take home looks like after student loans, healthcare and pension etc i'll see about doing this.
 
The tax "penalty" for the benefit of private healthcare is worth it IMO. When I had private medical insurance, I'd get 20 physio therapy sessions a year as part of it, free full health check ups ,and we were able to take one of our kids to a specialist within 3hrs of the phone call (nothing serious), and when I busted my shoulder again (rugby) I got microsurgery within a week and was properly fixed with a full rehab programme.

Worth every penny. I went to the physio twice a month and I'd never been in better physical shape as a result.
 
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