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Health Insurance
An employee cash plan lets your team claim money back on everyday healthcare costs like dental check-ups, eye tests, and physiotherapy, typically for £3-£20 per employee a month.
An employee cash plan (also called a health cash plan or corporate cash plan) is an affordable health benefit that lets your team claim money back on everyday healthcare costs, such as dental check-ups, eye tests, and physiotherapy.
Many employers offer a cash plan for everyday health costs alongside private medical insurance for more serious conditions, giving staff broader support without the cost of comprehensive cover for the whole team.
An employee cash plan (also called a health cash plan or corporate cash plan) is a type of health insurance that helps staff manage everyday healthcare costs. For a fixed monthly premium, employees can claim cash back when they pay for routine treatments like dental appointments, new glasses, or physiotherapy sessions.
You might also hear these referred to as:
The concept is straightforward. Your company (or employees, via payroll) pays a monthly amount into the scheme. When an employee needs routine healthcare, they pay the provider directly, then submit a receipt to claim cash back up to their annual limit.
Quick example: Emma visits her dentist for a check-up and filling costing £95. She uploads her receipt to the cash plan app and receives £95 back in her bank account within 48 hours. Later that year, she claims £75 for new glasses and £60 for three physiotherapy sessions.
The important distinction: cash plans cover predictable, everyday health costs. They don't cover unexpected medical emergencies or hospital treatment - that's what private medical insurance does. Many employers offer both products together, using cash plans for routine care and private medical insurance for acute conditions.
Cash plans and private medical insurance solve different problems. If your team is asking for support with everyday costs like dental and optical, a cash plan is usually the better starting point. If they need faster access to specialists or surgery, look at private medical insurance instead.
Understanding how cash plans operate helps you decide whether they're right for your business. The process is simple and designed to be low-friction for both employers and employees.
You choose a cash plan provider and select a coverage level that fits your budget. Most providers offer 4-6 tiers, with higher levels providing greater annual claim limits. You can fund the plan entirely, split costs with employees, or offer it as a voluntary benefit where staff pay the full premium through salary deduction.
Setup typically takes 2-4 weeks and requires minimal paperwork. Providers usually offer online portals for managing enrolments, and some integrate directly with HR systems for automatic updates when staff join or leave.
When your team needs routine healthcare, they simply visit their preferred provider. This could be their regular NHS dentist, a high street optician, a local physiotherapist, or any registered healthcare professional. There's no network restriction, no pre-approval needed, and no GP referral required.
Employees pay for the treatment at the time, exactly as they would normally. The cash plan doesn't change how they access healthcare, it just helps with the cost afterwards.
After treatment, the employee submits a claim through the provider's app or online portal. They upload a photo of their receipt, enter the treatment details, and submit. Most providers process claims within 24-72 hours, paying directly into the employee's bank account.
Each policy sets annual limits by category. For example, a mid-tier plan might allow claims up to £150 for dental, £100 for optical, and £200 for physiotherapy per year. Once an employee reaches a category limit, they can't claim more in that area until their policy year renews.
Providers supply employer dashboards showing scheme utilisation, claim patterns, and renewal information. This data helps you understand which benefits employees value and whether your coverage level is appropriate. At renewal, you can adjust tier levels, add or remove benefits, or switch to a different provider.
Employee benefits
An advisor can compare cash plan tiers across a wide range of providers and help you find a level that fits your budget.
Cash plans come in several formats to suit different business needs and budgets. Understanding these options helps you choose the right approach for your organisation.
With this approach, your business pays the entire premium for all eligible employees. This delivers maximum engagement since everyone is automatically enrolled (though they can opt out). It's the most straightforward option to administer and sends a clear message that you prioritise staff wellbeing.
The main advantages are high employee uptake, simple administration with no payroll deductions, and a strong recruitment and retention benefit. The trade-offs are the higher cost to the business, the fact some employees may not use the benefit, and the reporting requirements that come with a company-funded benefit.
Here, employees choose whether to join and pay the premium themselves through salary deduction. The employer negotiates a group rate, typically cheaper than individual policies, but doesn't fund the benefit directly. This approach works well when budgets are tight or when you want to offer choice.
There's no direct cost to the employer and employees get group rates unavailable individually, with self-selecting participation usually meaning high engagement among members. The downsides are lower overall uptake than company-paid schemes, the need for payroll integration, and the perception among some staff that it's a lesser benefit.
This hybrid approach sees the employer fund a basic level of cover for all staff, with employees able to upgrade to higher tiers at their own expense. For example, you might fund a Level 2 plan for everyone, allowing staff to pay extra to access Level 3 or 4 benefits.
This balances employer cost with employee choice: everyone gets baseline coverage, and staff who value health benefits can enhance their own cover. The trade-off is more complex administration, with multiple tier levels to manage and communicate clearly.
Larger organisations often include cash plans within a flexible benefits platform, where employees allocate a benefits allowance across multiple options. Staff might choose between a cash plan, additional pension contributions, extra holiday, or other benefits based on their personal priorities.
This gives employees maximum choice and lets cash plans compete fairly with other benefits, suiting a diverse workforce. It does require a more sophisticated benefits platform and higher administrative complexity, and some employees may not select health cover at all.
One of the most appealing aspects of cash plans is their accessibility. Unlike private medical insurance, there are minimal eligibility hurdles, making them inclusive for your entire workforce.
Most cash plan providers accept employees from age 16 or 18 up to age 65. Some schemes allow enrolment up to age 75, though options become more limited for older workers. Age doesn't affect pricing for group schemes, so a 55-year-old pays the same premium as a 25-year-old under company-funded arrangements.
After enrolment, cover typically continues until the employee leaves employment or reaches a maximum age, usually 75-85 depending on the provider. Some providers let retirees continue cover on individual terms at their own expense.
Cash plans don't require health questionnaires or medical histories. Everyone joins on the same terms regardless of existing health conditions. This makes them genuinely inclusive for staff with ongoing health needs who might struggle to access private medical insurance.
An employee with diabetes can claim for their regular optical checks. Someone with arthritis can claim for physiotherapy sessions. There's no concept of pre-existing condition exclusions, because cash plans reimburse routine care that everyone needs.
Most cash plans allow employees to add their partner and dependent children to their policy. Partner cover typically costs the same as the employee premium, so it doubles the cost, while children are often included free up to age 18, 21, or 24 depending on the provider.
When dependants are added, they get their own separate benefit allowance rather than a shared pot with the main member. If the employee has £150 dental cover, their partner also gets £150 dental cover to use independently.
Unlike private medical insurance, which often imposes waiting periods for certain treatments, cash plans typically allow claims from day one of cover. An employee who enrols today can claim for a dental appointment tomorrow, provided they have a receipt.
Some specific benefits may have short waiting periods. Maternity benefits, for example, might require 10-12 months of continuous membership before an employee can claim. Standard dental, optical, and therapy benefits are usually available immediately.
Cash plans work for organisations of any size, though minimum group sizes vary by provider. Some insurers accept groups as small as 2-3 employees, while others require 5, 10, or more. Smaller businesses often find cash plans particularly valuable, since they offer meaningful health support without the budget required for a full private medical insurance scheme.
The inclusive nature of cash plans makes them especially suitable for diverse workforces with varied health needs, ages, and working patterns. Part-time staff, contract workers, and employees on different shift patterns can all benefit equally.
Understanding the full cost picture helps you budget accurately and communicate the benefit's value to employees.
Exact limits vary by provider, and some offer five or six tiers with more granular pricing. Always compare the total benefit value against the premium cost to assess value for money.
Cash plans are treated as a taxable benefit in kind by HMRC.
For employers:
For employees:
Even after tax, the employee receives significant value, particularly if they claim back more than the premium cost.
Beyond premiums and tax, factor in:
Industry research suggests employers see tangible returns from offering a cash plan. Simplyhealth surveys found that 51% of employers reported improved employee satisfaction, 46% reported reduced sickness absence, and 42% cited improved retention after introducing a scheme.
When weighing up potential return on investment, consider:
Getting a cash plan in place for your business is straightforward. The UK market includes providers such as Simplyhealth, Westfield Health, Medicash, Health Shield, BHSF Group, Bupa, and Benenden Health, each with different pricing and benefit structures. An advisor can compare options across a wide range of these providers on your behalf.
How to get started
Assess your needs
Consider how many employees you'll cover, what budget you can allocate per employee, whether you'll fund the scheme fully, partially, or offer it as a voluntary benefit, and which benefits your employees are likely to value most.
Compare providers
An advisor can compare cash plan providers across the market, explaining differences in pricing, benefit structures, and added extras like virtual GP access or wellbeing apps.
Request quotes
Providers quote based on your employee headcount, coverage level, and funding approach. Group quotes are typically valid for 30-60 days, and individual health information isn't required.
Finalise and implement
Sign the group policy agreement, set up your employer administration portal, enrol employees (often via data upload or HR integration), and brief your HR and payroll teams on ongoing administration.
Manage the scheme ongoing
Monitor utilisation through the provider's dashboard, handle joiners and leavers throughout the year, and review scheme performance ahead of renewal.
Key advantages
Like any employee benefit, cash plans have both strengths and limitations. The advantages above are real, but it's worth understanding the trade-offs too.
A cash plan tends to suit businesses that:
You might want to consider alternatives if:
The biggest risk with a cash plan isn't the cost, it's low engagement. If staff don't know what they can claim for, the scheme quietly becomes poor value. A short briefing when the scheme launches, plus a reminder at renewal, makes a real difference to how much use employees get out of it.
Understanding how cash plans compare to other health benefits helps you make the right choice, or decide to offer more than one product together.
Private medical insurance covers treatment for acute medical conditions, including hospital stays, surgery, consultations with specialists, and diagnostic tests. Cash plans cover routine healthcare like dental and optical. They serve fundamentally different purposes.
Choose a cash plan when budget is limited, you want inclusive cover for all staff, and routine healthcare support is the priority. Choose private medical insurance when fast access to diagnosis and treatment for illness is essential, particularly for senior or key employees. Many employers offer cash plans for all staff, covering day-to-day health costs, while providing private medical insurance for management or key roles, covering serious health events.
Standalone dental insurance focuses solely on dental care, often with higher limits than a cash plan's dental element. If your workforce has significant dental needs, dedicated dental cover might offer better value than the dental component of a broader cash plan.
That said, cash plans cover multiple treatment types. The combined value of dental, optical, and therapy benefits often exceeds what you'd get from dental insurance alone at a similar price point.
Some employers question whether health benefits are necessary at all. Consider that Simplyhealth research from February 2025 found 73% of HR decision-makers feel greater responsibility for employee health due to NHS waiting times, and that UK employees average 7.8 sick days a year, with musculoskeletal and mental health issues among the leading causes.
Competition for talent also means benefits packages increasingly influence job decisions. A cash plan represents a relatively low investment for meaningful employee support - the alternative, employees facing healthcare costs alone, can affect morale, productivity, and loyalty.
Coverage varies by provider and tier level, but most cash plans include the following core benefit categories.
The most commonly claimed benefit. Typical coverage includes routine check-ups and examinations, scale and polish treatments, fillings, crowns and bridges, root canal treatment, extractions, emergency dental treatment, and dental x-rays.
Most plans reimburse up to 100% of costs within the annual limit. Higher tier plans might offer £300-£400 annual dental cover, while entry-level plans might cap at £75-£100.
The second most popular category. This usually covers eye examinations and sight tests, prescription glasses and frames, contact lenses, and prescription sunglasses. Some plans include a contribution towards laser eye surgery.
Typical limits range from £50-£250 a year depending on the coverage level. Some plans reimburse 100% up to the limit, others reimburse a percentage of costs.
Covers treatment for musculoskeletal issues and other conditions, including physiotherapy sessions, osteopathy, chiropractic treatment, acupuncture, homeopathy, and podiatry or chiropody.
This benefit has grown in popularity as employers recognise that back pain, repetitive strain, and similar issues cause significant absence. Therapy limits typically range from £100-£500 a year.
Many plans reimburse NHS prescription charges, sometimes limited by the number of items rather than value. This is particularly valuable for employees with ongoing medication needs. Entry-level plans might exclude prescriptions, while mid-tier plans and above typically include them.
Though cash plans don't fund treatment, many pay a fixed amount, typically £25-£100, per night an employee spends in an NHS hospital as an inpatient. This helps cover incidental costs during a hospital stay and doesn't require private treatment.
Increasingly common on modern plans, this can include health assessments and MOT-style check-ups, blood tests and health markers, and sometimes virtual health screenings.
Most contemporary cash plans include a mental health element, such as counselling sessions, an employee assistance programme, online cognitive behavioural therapy, mental health helplines, and wellbeing apps and resources. This has become a standard feature as employers recognise the importance of psychological wellbeing alongside physical health.
Many providers bundle extras alongside core coverage, such as 24/7 virtual GP consultations, health and wellbeing apps, retail discount schemes, gym membership discounts, nutritional advice, and health information helplines. These extras can significantly enhance the overall value of the package beyond simple claim reimbursements.
Independent guidance on health benefits and financial decisions from regulated and government-backed organisations.
Common questions
Cash plans reimburse routine healthcare costs like dental check-ups and optical appointments. You pay the provider, then claim money back. Private medical insurance covers treatment for acute conditions, including consultations, diagnostics, and surgery, with the insurer typically paying the hospital or specialist directly. They serve different purposes, and many employers offer both together.
Premiums typically range from £3 to £20 per employee per month, depending on the coverage level. Entry-level plans around £3-£5 monthly usually offer £75-£100 limits per benefit category, while premium plans at £15-£20 monthly can provide £300-£500 limits. Group rates for businesses are generally cheaper than individual policies.
Yes, most providers allow employees to add partners and dependent children. Partners typically cost the same as the main member's premium. Children are often included free up to age 18, 21, or 24 depending on the provider. Each family member gets their own benefit allowance rather than sharing a pot with the main member.
Minimum group sizes vary by provider. Some accept companies with as few as 2-3 employees, while others require 5, 10, or more. Smaller businesses often find cash plans particularly valuable as an affordable way to offer health benefits without the cost of private medical insurance.
Yes, employer-funded cash plans are a taxable benefit in kind. The premium value is added to the employee's taxable income and collected through their tax code. A basic rate taxpayer pays 20% tax on the premium value, but the after-tax benefit still represents good value, especially if they claim more than the premium costs.
Yes. One of the main advantages of cash plans is that pre-existing conditions are covered from day one. There's no medical questionnaire or health assessment required to join, and an employee with an ongoing condition can claim for related treatments straight away, within their benefit limits.
Most business policies don't have waiting periods for new cover, meaning employees can claim immediately once the policy starts. However, moratorium underwriting means pre-existing conditions won't be covered initially.
Most schemes accept members from age 16 or 18. Maximum entry ages are typically 65, though some providers accept enrolments up to age 75. Once enrolled, cover usually continues until employment ends or a maximum age of 75-85. Age doesn't affect premium pricing for group schemes.
Yes, part-time employees can be included in group cash plans. Some employers set eligibility criteria like minimum hours worked, but this is a business decision rather than a provider restriction. The premium cost is the same regardless of working hours.
When an employee needs treatment, they contact the insurer to get their claim pre-authorised. The insurer confirms what's covered and often pays the hospital directly. For smaller claims, employees may pay and claim back. Most insurers have apps that make claiming straightforward.
Once an employee reaches their limit in a benefit category, they can't claim more in that area until their policy year renews. They can still claim in other categories where they have remaining allowance. Upgrading to a higher tier at renewal provides increased limits for the following year.
Yes. Cash plan premiums paid by employers qualify as a tax-deductible business expense, reducing your Corporation Tax liability. Employers must also pay Class 1A National Insurance on the premium value and complete the required reporting for each employee receiving the benefit.
Many schemes allow employees to upgrade voluntarily beyond the employer-funded level, with the additional premium paid through salary deduction. This hybrid approach lets you offer baseline cover for all staff while letting those who value health benefits enhance their own cover.
Most schemes can be operational within 2-4 weeks of confirming the arrangement. This includes finalising the policy, setting up the employer administration portal, enrolling employees, and distributing member materials. Larger or more complex implementations may take longer.
Typically from day one once they're enrolled in the scheme. Unlike private medical insurance, which often has waiting periods, cash plans allow immediate claims for standard benefits. Employees can claim for treatments received after their cover start date.
Cover usually ends on their leaving date. Some providers offer options for departing employees to continue on individual terms at their own expense. Claims for treatment received before the leaving date can usually still be submitted within the claim deadline, typically 3-6 months.
New employees can be added via the employer administration portal or by notifying the provider directly. Cover typically starts from the agreed date, and new joiners receive the same benefits as existing members, with premiums adjusted accordingly.
It depends on your objectives and budget. Cash plans cost less and cover routine care inclusively. Private medical insurance costs more but covers serious illness and provides faster access to specialists. Many employers offer cash plans for all staff and private medical insurance for senior roles, combining both approaches.
Yes, this is common practice. The cash plan handles everyday health costs like dental check-ups, glasses, and physio sessions, while private medical insurance protects against acute conditions requiring hospital treatment or specialist care. Employees can claim on whichever policy covers their specific treatment.
Often, yes. Small businesses typically can't afford comprehensive private medical insurance for all staff, but cash plans offer meaningful health support at accessible price points. A company paying £5 per employee monthly demonstrates real investment in staff wellbeing, and the recruitment and retention benefits can outweigh the modest cost.
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