Healthcare Cash Plans Claim medical/alternative therapy costs

Whether it's NHS or private, you can cover dental, optical, alternative treatments and medical costs for just a few pounds a month. Better still, they can potentially pay back five times what they cost. This is a full step-by-step guide to the best buy healthcare cashback schemes, which should help you find the right one.

What are cash plan schemes?

Technically, they're insurance policies which pay out when you incur healthcare costs. You pay a monthly payment (a premium) and then when you lay out your own cash for a treatment, reclaim a percentage of the costs back, up to a pre-determined maximum.

Let's make it simple.

Spend �100 at the osteopath. Send the receipt to the cash plan and it'll typically send you 75% of that back (ie, �75)

However each plan differs on what's covered, the maximum amount you can claim per treatment, and the percentage payout. Though even on cheaper policies, they pay out on a broad range of things including chiropody, inpatient stays, and complementary health. See a list of commonly covered treatments).

Most people can manage 'normal' heathcare costs, but for many, cash plan schemes can be superbly helpful. Yet they're not always cheaper overall than 'self-insuring'; routinely stashing cash in a dedicated Top Savings Account for use when the need arises.

Do you pay out regularly for optical or dental treatments?

Cash plans usually cover both dentistry, including check-up costs and treatments, and optical treatments such as sight tests, prescription glasses or contact lenses .

If you regularly spend on these, it boosts the value of a cash plan to you, as the payout on these alone roughly matches the annual pay-in. This story should explain.

Dennis Talplan, or Den to his friends, has regular check-ups at the dentist, spending about �40/year. As a glasses wearer, he spends the same amount at the optician. He is signed up to the Paycare cash plan's most basic level, at �5.75 a month.

So, while he's laying out �69 a year for the policy, he's able to reclaim �80, which comes to 116% of his costs. This means he is more than recouping the cost of the plan, so if any further treatment needs spring up he's covered and in profit.

If this situation's like yours, jump to First Timers' Best Buys for the top payers. Cash plans can be a good alternative to getting specific dental insurance, though in some circumstances that can be better too (see Cheap Dental Insurance). Remember you can often save by getting optical products online (see Cut Contact Lens Costs and Glasses Buying guides).

How do they work?

Arrange the treatment, pay the money and then send off a receipt and claim form to reclaim the cash. This does mean if you're not the type of person who'll remember to send off the receipts, don't bother with one of these plans.

Normally there's no need to inform the cash plan provider before having treatment, though this is requested in certain cases. Typically this applies to something like osteopathy, where you'd be required to have a GP or specialist confirm it was treatment for an actual condition.

The nitty-gritty

How can they pay out so much?

The plans sound phenomenal. They cover your costs and for someone having a LOT of treatments, can pay back more than five times what you pay in, year by year. So, how can it all add up?

• Most people don't claim!
  
  

  Just because people can claim, doesn't mean they do. Many people forget to send in their claim forms, so there's no payout at all. Cash plan providers rely on apathetic customers with direct debits subscriptions dripping from their bank accounts to keep the coffers healthy. So bear in mind...

  Cash plans are only great value if you'll make claims. If you won't, they're a complete waste of money.

• They have strong historic reserves
  
  

  Most cash plan providers are non-profit organisations set up before the NHS. These older operators tend to have built up substantial investment portfolios, which ease their finances and allow them to pay more generous benefits. For more on cash plans' mutual status and other similar issues, read the additional notes on an historic boon

  An historic boon

  The earliest cash plan companies were set up towards the end of the 19th century. They were non-profit organisations then, and most continue in that mode to this day.

  Their healthy investment portfolios benefit modern policyholders, and also means spare money each year is donated to charity, often to specific health-related charities local to the cash plan company.

  Is it possible to get a windfall if they float?

  Though the majority of cash plans are non-profit organisations, they're often incorrectly referred to as mutuals. In truth, they tend to be companies limited by guarantee. This means it's highly unlikely that joining would ever mean windfall benefits from demutualisations. Most cash plan groups' constitutions state if companies close down their businesses, customers and assets will transfer to another similar scheme or charity.

  In recent years some profit-making companies, like Standard Life, Aviva (Norwich Union) and Bupa, have moved in and out of the market. Their strong brands and marketing have helped build the market as a whole, but their plans still leave something to be desired and rarely make the top three.

Best buys

The top policies

If you're not sure you'll remember to claim, these first timers' picks focus on cheap plans. So if you forget to claim the loss is small, but it does mean the potential payback is reduced. If it works, then you can always increase the plan level later.

First timers

To find the first timers' top picks, each provider's lowest-priced plan was chosen. Here are the rankings (always check the cover levels suit your needs before buying).

Claim basis: �40 towards each of dental and optical treatment.

	1st place	2nd place	3rd place
Company:	Paycare	WHA	Medicash
Plan:	Direct 1	Personal 145	Level 1
Costs:	�5.95 per month (�71/year)	�6.28 per month (�75/year)	�6.50 per month (�78/year)
Annual payout:	�80	�80	�80
No-claim period:	First 13 weeks	First 12 weeks	Can claim straight away, though check individual policies
Score:	1.12	1.06	1.03

Single Adults

The aim here is to find a policy with a range of cover and a good payout rate. Always check the cover levels suit your needs before buying.

Claim basis: A range of treatments was chosen. Dental, optical, osteopathy and physiotherapy. The price level used was the nearest to �10 a month per adult.

	1st place	2nd place	3rd place
Company:	Medicash	Birmingham Hospital Saturday Fund	Sovereign
Plan:	Level 1	Value (age 17-34s only)	Level 2
Costs:	�6.50 per month (�78/year)	�8.95 per month (�107/year)	�8.84 per month (�106/year)
Annual payout:	�240	�200	�170
No-claim period:	Can claim straight away, though check individual policies	First 13 weeks	Six months for pre-existing conditions
Score:	3.08	1.87	1.6

Single parents with one child

As above, the aim is to find a policy with a range of cover and a good payout rate. Always check the cover levels suit your needs before buying.

Claim basis: A range of treatments was chosen. Dental, optical, osteopathy and physiotherapy. The price level used was the nearest to �10/month per adult. These providers cover one child at no extra cost.

	1st place	2nd place	3rd place
Company:	Medicash	UK Healthcare	Westfield
Plan:	Level 1	Option 2	Good4You Level 2
Costs:	�6.50 per month (�78/year)	�8.50 per month (�102/year)	�11.20 per month (�135/year)
Annual payout:	�310	�375	�297
No-claim period:	Can claim straight away, though check individual policies	First 13 weeks	First 12 weeks for most treatments
Score:	3.97	3.38	2.2

Families

Once again, the aim is to find a policy with a range of cover and a good payout rate. Always check the cover levels suit your needs before buying.

Claim basis: A range of treatments was chosen. Dental, optical, osteopathy and physiotherapy. Family schemes are the top payers overall, with potential returns slightly higher than even the competitive single parent schemes above.

	1st place	2nd place
Company:	Medicash	Birmingham Hospital Saturday Fund
Plan:	Level 1	Value (age 17-34s only)
Costs:	�13 per month (�156/year)	�17.30 per month (�207/year)
Annual payout:	�640	�750
No-claim period:	Can claim straight away, though check individual policies	First 13 weeks
Score:	4.1	3.6

Our survey of providers was completed in May 2009 (though results tend to change very infrequently). The companies included were: Secure Health, Pinnacle, Westfield, Healthshield, Bupa, Healthsure, Premier Health, WPA, Bolton & District, WHA, Boots, Insure-for-less, Saga, CS Healthcare, Birmingham Hospital Saturday Fund, Halifax, Axa PPP, Standard Life, Paycare, LHF, Medicash, Engage Mutual, Benenden Healthcare, Sovereign and HSF.