Consumer confidence key to a positive recovery in self-pay healthcare
The fourth edition of LaingBuisson’s Private Healthcare Self-Pay UK Market Report has been launched today. It shows a continuing growth in interest in private healthcare in the face of NHS waiting lists.
The trend towards greater spending on health and wellbeing, first identified by LaingBuisson in 2020-21, has continued through 2021 and through into 2022. This is not only through people privately funding their care, but there is also more interest in private medical insurance.
NHS waiting lists are the most commonly cited reason for the growth in awareness and interest in self-pay. However, the interest is not only in the elective surgical procedures most often associated with this market. People are increasingly turning to private GPs, diagnostics and consultants to expedite treatment, even if they do not remain on an independent healthcare pathway afterwards. Though, of course, having engaged with private healthcare, these lower cost entry points introduce people onto a pathway for other services.
NHS demand management strategies are also fuelling interest in private initial consultations and diagnostics. These relate mainly to restrictive funding criteria in orthopaedics, ophthalmology, gastroenterology, gynaecology and urology, where there has been a noted increase in interest in self-pay enquiries – though how many convert to business is another question.
But there are also pull factors. One is greater pricing transparency and access to payment plans, which make it easier for people to choose to ‘go private’. Some private hospital groups have harmonised their prices across the UK and some NHS private patient units are making information and prices more visible, giving consumers greater confidence to invest this way in their health. This is supported by specific services, such as vein clinics, day surgery only clinics and ophthalmology providers offering competitively priced services based on their efficiencies and economies of scale.
Meeting demand is not without its challenges. Although private providers are keen to return to serving their core private patient segments, there is still the possibility that private sector capacity may be used by the NHS to reduce waiting lists. Issues with attracting sufficient qualified staff may also put a brake on growth.
Report author, Liz Heath said:
“While there is a continued sense of optimism about the future of the self-pay market, we are not clear yet about the scale of growth going through 2022 and 2023, though early indications from some large providers are very positive. Consumer confidence is key to the direction of travel of this market. While the inability to spend money on holidays and leisure activities in 2020/21 meant that people had money in their pockets which they chose to spend on health and wellbeing, current inflationary pressures, the wider geo-political situation and the opening up of society following the pandemic may serve to stifle growth given this kind of healthcare spending is generally discretionary.
“Nevertheless, there does appear to be a direct correlation between the well-publicised and lengthening NHS waiting lists and waiting times for elective procedures and diagnostics and enquiries around self-pay. Since those waiting lists are not falling, we would expect demand to be sustained as people seek to access treatment. The question for the private healthcare sector is whether it has the staff and resources to meet that demand.”