A Green Party peer is calling for greater regulation of UK private medical insurance (PMI) after raising several concerns about the sector in Parliament, Health & Protection can exclusively reveal.
Baroness Natalie Bennett (pictured) told Health & Protection it appeared private medical insurance was not being properly regulated and feared industry practices were harming patients.
She highlighted this was particularly important as more people were taking-up medical insurance given pressures and waiting lists on the NHS and warned companies “will not do the right thing on their own”.
Baroness Bennett has quizzed the government over several key issues involving regulators and called for tighter oversight of the industry along with better access to care for patients.
However the government rejected her demand for the Care Quality Commission (CQC) to be given responsibility for overseeing medical insurers and defended the Financial Conduct Authority (FCA) for setting “high standards of consumer protection”.
It also directed concerns about the competition regulator’s private healthcare market investigation finalised in 2014 to the Competition and Markets Authority (CMA).
Forced to opt for private insurance
Elaborating on her concerns, Bennett told Health & Protection her initial interest in the issue was sparked by the news that in Australia Bupa admitted to engaging in misleading or deceptive conduct by advising members they were not entitled to private health insurance benefits when they were, after which the insurer was forced pay a A$35m fine.
“That reflects much of what we hear out of the US, and anecdotally cases in the UK, where we know that many people are feeling forced to opt for private insurance for fear, or knowledge, of waiting times in the NHS,” Bennett said.
“Subsequently, I’ve been speaking to the Independent Doctors Federation (IDrF), who expressed concerns to me that their members’ clinical judgement was constrained by non-clinical criteria and that insurer-led care pathways are pushing more risk and complexity back onto patients and the NHS.”
Bennett further revealed that the IDrF had told her about a survey of their members showing a third had seen a patient’s condition deteriorate after being denied cover for a treatment.
Not properly regulated
She added that she and the Green Party believed in a publicly owned and run NHS, genuinely available to all within reasonable timeframes.
“But given the current realities, it is vital that private insurance is properly regulated and overseen, which it would very much appear is not now the case,” Bennett continued.
“We’ve seen what impact weak and non-existent regulation has had across our society, from the water companies to our broken food system, with the dominance of ultra-processed food-like substances in the British diet.
“This is one more case where the government has to oversee companies that will not do the right thing on their own.”
CQC, FCA and CMA oversight
In a series of questions, Baroness Bennett asked the government about its approach to regulation of PMI, the work of existing rules and whether it would tighten up by introducing further oversight.
However, responses included a denying a request for the Care Quality Commission’s powers to be extended, detailing the existing powers of the FCA and the need for her to refer competition concerns to the CMA.
Baroness Bennett urged the government to “expand the remit of the Care Quality Commission to include oversight of private medical insurers to ensure that insurer-led decisions do not impact clinical autonomy or patient safety”.
Responding for the government, Baroness Merron said the role of the CQC is to regulate health and adult social care providers in England.
“There are no plans to extend the role of the CQC to regulate private medical insurers,” she said.
Baroness Bennett also quizzed the government about what it is doing to ensure the FCA’s Consumer Duty obligations “are being enforced in ways that address risks to patient safety and informed consent in private medical insurance contracts, particularly in relation to the treatment of pre-existing conditions and service exclusions.”
In response Lord Livermore pointed out that the government requires all insurers, including those providing private medical insurance, to treat customers fairly, adding this is enforced under the rules of the FCA.
“The FCA has a statutory objective to protect consumers. The government holds the FCA to account for how it advances its objectives, including through the FCA’s Annual Report which is laid before Parliament,” he said.
“The FCA’s Consumer Duty sets high standards of consumer protection across regulated financial services firms, including a requirement for firms to put their customers’ needs first.
“The FCA monitors firms to ensure they meet these standards and has robust powers to take action where necessary,” he added.
Baroness Bennett further asked the government if it planned to re-assess and update the Private Healthcare Market Investigation Order 2014, published by the CMA on 1 October 2014.
Baroness Jones responded by pointing out that responsibility for reviewing the Private Healthcare Market Investigation Order 2014 lies with the CMA, which keeps markets remedies under review.
“While the CMA has not initiated a review of this order at this time, it welcomes submissions from relevant parties where existing remedies may no longer be fit for purpose,” she said.
“If the CMA reviews the order and deems there to be a change of circumstance such that the order is no longer appropriate, it can vary or revoke the order.
“However, it cannot introduce a new order as this would require a new market investigation,” she added.
The Association of British Insurers (ABI) and Bupa have been contacted for comment.
