Dealing with the financial costs of fighting cancer
Cancer is one of the most common diseases of our time, with four in 10 people developing it at some point in their lives, according to Macmillan Cancer Support. But while the statistics mean that many of us will either contract cancer, or know someone who will, medical advances mean people diagnosed with cancer are now living nearly six times longer than they would have 40 years ago.
Unfortunately, these improvements don't come cheap. Figures from Bupa put the average cost of cancer care at £30,000 per person in 2010. And, with a course of some cancer drugs costing more than this on their own, it's not unusual for treatment costs to run into six-figure sums.
While for many of us the NHS will cover the cost, it can be a bit of postcode lottery, as Dr Doug Wright, head of clinical development at Aviva UK Health, explains: "There is huge variation in the amount being spent on cancer around the country. While some primary care trusts spend more than £40,000 per 1,000 patients on cancer inpatient treatment, others spend less than £20,000."
This means that some treatments may not be available to you through the NHS. To make sure you receive the best treatments possible, taking out private medical insurance could be the answer. With this, rather than being treated on the NHS, you'll receive your treatment privately so, as long as it's covered by your insurer, there'll be no questions about whether you can have it.
Jack Zoltie, 77, from Surrey, is very pleased he'd taken out medical insurance with WPA for himself and his wife Joyce, 76, when she was diagnosed with breast cancer some 25 years ago. "My wife died earlier this year after a long battle with cancer but her medical bills were always taken care of by WPA," says Jack, who estimates that over that time the cost of Joyce's treatment could well have exceeded £250,000.
As well as picking up the cost of treatment, being able to go private made a huge difference to Jack and his family, especially when it came to the amount of time Joyce had to spend in hospital. "We found that people being treated on the NHS could be given an appointment at 12pm and not be seen until 4pm. If Joyce's appointment was delayed, the hospital would ring us to let us know to come later," says Jack.
Cover varies between policies but Emerson Alder, individual healthcare adviser at PMI Health Group, says there have been some significant improvements recently with more insurers extending cover to include the cost of palliative care that is given once a cancer is no longer treatable.
"Bupa has always provided full cancer cover but this is now offered by AXA PPP healthcare, Aviva, PruHealth and Exeter Family Friendly too. There's very little difference between them but be aware that older plans might not include full cover and PruHealth and Exeter also offer lower levels of cover," he says.
Where cover is more limited, it's usually palliative care that's excluded, with insurers helping cancer patients move to NHS treatment once it becomes terminal. There can also be limits on drugs, with some insurers putting a 12-month time limit on courses of drugs or specifying which drugs they'll cover.
"Do check your policy documents or speak to your insurer if you're not sure what cover you have," adds Alder. "You may be able to upgrade your policy if you want more cover."
Whether you go for full cover or something more restricted, you must be careful you abide by their terms and conditions if you need treatment. Alder says insurers have guidelines on what they consider to be reasonable and customary charges. "If the cost of your treatment exceeds these you might have to pay a shortfall," he says.
While the risk of shortfall can be worrying, Alder says insurers try to avoid this happening. "Where possible, pre-authorise your treatment," he says. "If there's a risk of a shortfall, insurers will discuss your treatment options with your doctors to ensure they can cover treatment as best they can."
CRITICAL ILLNESS COVER
Rather than take out insurance to pick up your medical bills if you're diagnosed with cancer, a critical illness insurance policy is another option. "A critical illness policy will pay out a lump sum if you're diagnosed with a qualifying cancer or other life-threatening disease such as stroke or heart attack," says Peter Chadborn, director at IFA Plan Money.
"We do see people taking out cover to help with the cost of cancer treatment but you can use the money however you like. This could include replacing income if you're unable to work, modifying your home or even going on a good holiday to help you recover."
As an example, when Frank Hadley, 58, a telephone account manager from Hertforshire, received a payout on his PruProtect critical illness policy after he was diagnosed with prostate cancer, he used the money to clear his mortgage.
"It was by complete chance that I was diagnosed with cancer," he explains. "I'd had no symptoms and simply took a prostate-specific antigen (PSA) test to earn extra points on the policy's vitality programme so I could get benefi ts such as spa treatments and reduced premiums."
The test showed Frank's PSA levels were raised and he was referred to a specialist who removed his prostate. "It was a fast-growing cancer and if I hadn't taken the test I might not even be here today," he adds. "I do think I have a charmed life."
There are variations on the traditional critical illness policy too. For example, it's possible to take out a critical illness policy that only covers cancer. Chartis Insurance offers a Cancer Care policy, with cover levels starting at £25,000. This pays out on diagnosis of a cancer. It also has a WellWoman policy, which pays out £25,000 or £50,000 upon diagnosis of any of seven female cancers including breast, cervical and ovarian.
But while Chadborn welcomes innovation in the critical illness insurance market, he warns against ditching an old policy, even though it may be more expensive or appear to have less cover. "Medical advances mean that some cancers are much less serious now but, although they won't be included on new policies, you might still have cover on an old policy. Check the policy details carefully before trading it in," he says.
In particular, policies that were issued before 2007 could have more generous defi nitions of critical illness, which may mean you receive a payout for a less serious type of cancer. And check you don't already have cover.
Neal Southwick, spokesperson for Macmillan Cancer Support, says that callers to the charity's helpline often don't realise they have cover. "It can be included as a bolt-on to a mortgage or life insurance," he says. You might even have private medical insurance through your employer that covers cancer treatment. "Check your policy documents as it can be a valuable benefit if you are diagnosed with the disease."
Need more info?
Macmillan Cancer Support can provide financial information and support to people with cancer. Call 0808 808 00 00 or visit macmillan.org.uk/financialhelp
Private medical insurance
PMI allows you to skip the NHS waiting list and arrange treatment at a time you choose. With most PMI policies, you pay a monthly premium (the older you are, generally the higher premium) and the policy will then pay out, up to specified cover limits and after an agreed excess, for any treatment you might need. Not all conditions are covered by PMI and you get what you pay for: the more cover you want, the higher your premium will be.
Generally thought of as being interchangeable with life assurance, but isn’t. Life insurance insures you for a specific period of time, at a premium fixed by your age, health and the amount the life is insured for. If you die while the policy is in force, the insurance company pays the claim. However, if you survive to the end of the term or cease paying the premiums, the policy is finished and has no remaining value whatsoever as it only has any value if you have a claim. For this reason, life insurance is much cheaper than life assurance (also called whole of life).
A financial adviser who is not tied to any financial services company (such as a bank or insurance company) and is authorised by the Financial Services Authority (FSA). They can advise on financial products to suit your circumstances. All IFAs have to give consumers the choice of paying by fees or commission and have to explain which would best suit the customer in that particular instance. Also, if commission is paid either by the client or the financial service provider recommended by the IFA, the IFA must disclose what that commission is.
Critical illness insurance
This cover pays out a tax-free lump sum if you become seriously ill. All policies should cover seven core conditions: cancer, coronary artery bypass, heart attack, kidney failure, major organ transplant, multiple sclerosis and stroke. You must normally survive at least one month after becoming critically ill, before the policy will pay out. Payouts are determined by premiums and premiums are determined by the severity of your illness, the less severe the lower the premiums.