With the rise in the cost of...

With the rise in the cost of private healthcare plans running at several times the rate of inflation, it is tempting for employers to cut back on these schemes, and it has been suggested that the next big development in the UK - following the US trend - may well be defined liability plans, where employees have a capped amount to spend on private health treatment.

According to research by Mercer Human Resource Consulting, a key reason for the cost increase is that more employees are choosing to use private, rather than NHS, treatment.

Steve Clements, European Partner at Mercer said: "The benefit of this increased use, if targeted correctly, is that employee illness is treated more promptly. Rather than reducing healthcare treatment, employers should consider an alternative approach: that of strategically investing more in employee healthcare and managing it effectively as a way of reducing sickness absence.