UK Medical - Health Trusts

Due to the set up costs of Trusts, these have traditionally only been a viable option for groups of at least 5,000 members, but a packaged service now makes this practical for groups of 100 or more.

The advantages of a health trust are:

Financial

• Avoids 5% Insurance Premium Tax charge.
• Avoids DTI levies, which account for around 2.25% of insurers' charges.
• Reduces the usual insurers' overhead charges.
• Allows the scheme to benefit from the investment income arising from the claim fund via a Trust bank account.
• Potentially improved cash flow as claims fund can be topped up as needed.

Practical

• Gives total flexibility - the benefits and rules can be tailored to the group's exact requirements.
• The group can retain control over scheme monies by acting as a trustee and so authorise payments outside the scope of the scheme where deemed appropriate.
• Easier to negotiate with hospitals, therefore possible to give a wider choice of hospital access to members.
• Literature printed specifically for each group, so it can be personalised for the group including logo's, welcome message, etc.

Possible Disadvantages

• Continuation options for group leavers/retirees not automatically provided and can be difficult to source.
• A health trust is uninsured, so you are liable for the full cost of claims, therefore the costs are potentially more volatile from year to year.

If this route is of interest we can assist by

• Providing guidance on suitable benefit terms, what should/should not be included and the likely cost implications.
• Providing guidance on suitable level for claims fund based on detailed assessment of risk profile of membership and usage within any previous insured scheme.
• Negotiate set up/administration fees.
• Drafting documentation and literature.
• Provide ongoing claims administration and advice to members.
• Provide detailed regular management reports on how scheme resources are being used.