Healthcare insurance pricing and benefit design


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Our UK healthcare consulting team brings broad experience and employs advanced tools to help clients design and price their healthcare plans. We provide insight for pricing all types of medical products, including primary care and dental cash plans, fixed-benefit surgical plans and full-indemnity medical insurance plans.

We recognise clients' need to research a variety of data sources when determining appropriate price levels. Milliman's team offers expertise in combining disparate databases and adjusting for their differences to create a unified, accurate portrayal of marketplace pricing trends.

In our pricing work, our local team employs Milliman's Health Cost Guidelines™, the industry standard for estimating claim costs and healthcare utilisation. The Guidelines enable our consultants to easily model the effects on profitability of using many different rating factors, such as benefit limits, copays and excess levels. This feature allows us to provide guidance on pricing different options for various member excess and annual limit levels.

Design and price guidance for a complex product

Milliman consulted with a UK insurer seeking to determine the appropriate pricing for a complex medical insurance product sold in the UK. The product had elements of secondary and primary care, cash back and return of premiums for unused benefits as well as differential premiums by health status.

Our consultants also developed a model for experience rating in the large-group market and for applying credibility factors to price large groups based on their prior experience as well as on book premium rates. In addition, Milliman reviewed the financial projections for this new insurer and provided assistance in developing appropriate assumptions to build into the model for future claims experience.

As a result, the client was able to launch a new product into the market very quickly, based on credible data, which limited its potential for under- or over-pricing relative to the market.

Next Steps

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