Insurers found lacking on peace of mind: Mental health cover is an area that is often overlooked in the search for a medical policy. Lee Rodwell reports

SHOPPING for medical insurance has always meant reading the small print, but even people who ensure that they will be adequately covered if they need surgery often fail to consider the possible need for cover for mental health problems.

The odds that you may, at some time, need treatment are relatively high. According to the Mental Health Foundation, up to six million people in the UK - one in 10 of the population - suffer from some form of mental illness in the course of a year.

Jan Lawson of the Private Health Partnership, the specialist insurance brokers, carried out a review of schemes providing psychiatric cover on behalf of the Independent Healthcare Association in 1992. She said little had changed since then.

'The insurers tightened up on psychiatric cover about 18 months ago, partially because of the size of the claims. When it comes to a mental illness, the whole area is very subjective as far as diagnosis, treatment and recovery is concerned. It's not like having surgery for a broken leg, where you have a problem, need an operation and then any doctor can see when you are better.'

She said people taking out insurance did not seem concerned whether psychiatric cover was included or not. 'Purchasers were interested in whether they could see a chiropractor if they had a bad back, rather than asking how much psychiatric cover there was if they had a nervous breakdown.

'Most of the schemes don't cover drug or alcohol abuse. A small proportion provide limited cover for psychiatric illness. Even those don't allow you to go straight to a psychotherapist or bereavement counsellor, for instance. You need to get referred by your GP to a psychiatrist who must assess what treatment you need.' The insurance company may then authorise treatment but it will also impose limits.

St Andrew's Hospital in Northampton is one of Britain's four psychiatric hospitals run as a charitable trust. The acute division looks after cases of alcoholism and drug abuse, eating disorders, stress, post-natal depression and post-traumatic stress.

Alastair Kennedy, director of operations, said: 'One of the difficulties with psychiatric cases is that you cannot predict how long a patient will need to stay in hospital. It could be 30 days or it could be 90 days.

''As a result, the insurance companies introduced managed care. A patient would see his GP, who would contact his insurance company and it would be agreed to allow him, say, 20 days' care at an approved hospital such as St Andrew's.

'The insurance company wants a review of progress every week, possibly more frequently. At the end of the allowed time they may then say they won't pay for further treatment.

'So we often find ourselves in a dilemma where our medical director has to decide whether we can use our charitable funds to support a patient we think we can cure or progress once the medical insurance has dried up.

'Since we are a charity we do pick up the bill for the rest of that treatment in some cases, but we are exceptional. In a conventional hospital you'd be out on your ear.'

Sue Dawson of Bupa said Bupa Care covered treatment for mental illness, including alcohol and substance abuse, but only subject to pre-authorisation.

'The claims we get tend to be for addiction, depression, stress. However, it is important to point out that many people are insured with us through company schemes. In order to keep costs down many companies reduce the range of cover and benefits, so often these people are not covered for mental disorders or addictions. It is always essential to check with your insurer before embarking on any treatment,' she said.

All of PPP's personal private health insurance plans except the rock-bottom Value Plan include a psychiatric scheme. However, this does not cover alcohol or substance abuse, although PPP's company schemes may.

Sandy Scott, the general manager, says that since the company introduced managed care, no patient has claimed that they were denied benefit they should have had.

'Some psychiatric illness will require long-term treatment. With eating disorders, for instance, about one-third of patients will develop long-term problems. Yet private medical insurance has always been concerned with acute conditions, not chronic ones.'

He suggests a critical look at time limits set by some insurers. 'Some limit you to 28 days' in-patient treatment. If you are sick enough to need in-patient treatment that won't be anything like enough.'

A spokesman for Norwich Union Healthcare said only Premier Care, the top-of-the-range plan, includes psychiatric cover and then only after two years' membership. In-patient treatment is limited to 45 days' maximum a year.

All of WPA's schemes exclude drug and alcohol abuse. In-patient treatment for other conditions is limited to 28 days in any five years. David Ashdown, corporate communications director, said: 'We have these rules to protect our subscribers overall. We have to keep premiums down.'

Jan Lawson of the Private Health Partnership has simple advice to those reviewing their medical insurance. 'Look for the best balance of costs and benefits. It's no good going for a policy which has the best cover on psychiatric illness if it's lacking in other directions. That said, it is a much underrated area of cover.'

(Photograph omitted)