Longevity is a defining feature of the cash plans industry – after all, most providers operating in it were formed long before the formation of the NHS, giving members access to affordable healthcare.
So perhaps it’s no surprise that Jonathan Burton, the chief executive of Health Shield, has spent more than two decades at one of them. During his time there, he has worked for an organisation that has evolved to become one of the major players in its sector, with broad appeal across the intermediary market – and the Best Cash Plan Provider gong from this year’s Health Insurance Awards safely in the trophy cabinet. But he confesses that when he joined the organisation more than two decades ago he had no grand plan to be in charge of it years later.
“When I joined Health Shield, I don’t think I’d ever stayed anywhere more than about two or three years,” he says. “I’d gained experience, moved on, gained some different experience, moved on. But the time here seems to have just gone in a flash.”
Burton isn’t the only senior figure at Health Shield to have committed themselves to the company for the long-term though.
Sales & marketing director Philip Wood has been there since 1980, being appointed to the board in 2005. Sales director Peter McAndrew has been there for around 16 years and finance director Maxine Wilson joined in 1999. It is, as Burton points out, a “stable team”.
During those years, the organisation has grown both financially and in headcount. Currently with more than 100 staff – a third are on the road and there are around 60 in its head office in Crewe – Health Shield has grown significantly from when Burton joined, when it had just 30 employees. The plan, he says, is to continue to grow and the organisation has already begun moving additional resources into a building adjacent to its existing headquarters.
There is a lot to go at. Health Shield has an overall cash plan market share of 5.5% and Burton says it is approaching the 20%-25% mark in the company paid market.
“That [the company paid] market is the area that we’ve been concentrating on, that’s the area where we’ve seen the biggest growth,” he says. “Back in 2002 we had around 36,000 members and the last membership report shows we have over 170,000.”
Not only that but independent market analyst Laing & Buisson says that Health Shield has grown organically over the past four years and in 2012 overall turnover increased by £1m to £27m.
Not a bad effort in a market as competitive as the cash plans sector, where in recent years providers have fought tooth and nail to attract the support of intermediaries and employers alike. That support was acknowledged earlier this year with Health Shield’s success in the Health Insurance Awards – something that Burton is clearly very proud of.
“We were absolutely delighted, as I’m sure you probably realised from the noise coming from our tables,” he says. “It was a really, really good night and everybody enjoyed it. I think it was testament to all the hard work and effort that all the team have put in over the last 12 months.”
The fact the organisation was shortlisted in three other categories, including Health Insurance Company of the Year, is “a tremendous achievement,” Burton adds.
But while the cheers from the tables hosted by the organisation were – and for readers not there on the night, they really were – the loudest of the night, Burton says that just goes to show the “good nature” of the competition in the cash plans market as a whole.
“Yes, I think certainly on the company paid side it has become competitive but it’s still quite a good natured competition,” he says. “We all get on. Yes, it has become more competitive but not uncomfortably so. There’s quite a deep held respect among the cash plan providers for each other. It’s a good-natured rivalry.”
That sentiment was at the fore – no pun intended – earlier this year when Health Shield was one of seven cash plan providers to take part in a charity golf day which raised thousands of pounds for Breast Cancer Care.
There is little doubt, though, that Burton wants to come out on top and during his time at Health Shield he has ploughed a lot of the society’s energies into developing partnerships with the intermediary community in order to do just that.
“Ten years ago we decided to have our core focus on business-to-business,” he explains. “And if you want to do that you’ve got to have an excellent working relationship with the intermediary market as a whole.”
The journey, Burton continues, has been hard-earned. Intermediaries are, quite rightly, not easily impressed and demand the best on behalf of their clients. And while, when Burton joined Health Shield, the organisation was not working with brokers at all, last year around 85% of its new business came through that channel.
“Obviously when it starts, it starts small and you have to gradually build up your name,” he explains. “But it became like a snowball. The better service that we provided to brokers the more ‘out there’ our name became. I think by providing the level of service that we do to brokers it brought our name to the fore, if you like. Of course, winning at the Health Insurance Awards doesn’t hurt does it?”
The recognition has certainly cemented Health Shield’s high-standing in the eyes of brokers up and down the country. So how did it get its hands on that all-important award?
“It’s really gathered pace over the last four years,” Burton explains. “We’ve started to see a real increase in interest from intermediaries in what we do and what we offer. It’s the level of service that we provide, both to intermediaries and to their clients and their clients’ employees – it works at every level.
“We’ve tried to raise our profile, especially over the last three or four years, but I think the fact that we were highly commended in three other categories – and the Best Customer Service Award in particular – was an indicator to me of why we got the Best Cash Plan Provider Award. We pride ourselves in the level of service that we provide to brokers.”
Direct business does, however, remain important to Health Shield. Earlier this year it launched Connect, a direct-to-consumer offering but brokers are at the heart of its business, Burton says. So what else is it that appeals to brokers?
“The fact that we listen, the fact that we respond quickly,” Burton says. “We pride ourselves on how quickly we respond to brokers, especially in terms of quotes for tailored schemes. Over the last two years the pricing and underwriting of schemes is an area that’s seen significant improvement for Health Shield and I think that’s been seen by the broker market.”
Burton acknowledges, though, that more needs to be done to raise awareness about Health Shield among the HR community. A recent internal research project carried out by the society suggests that employers were not as aware of the company and what it does as brokers seem to be.
“While our name is widely known among the broker community it is less so with larger employers,” he says. “That’s an area that we’d obviously like to improve on. It’s important to us to get our name known by as many people as possible. Everyone says that they provide the best customer service but unless you actually use us you don’t get to see that.”
A question of just of more of the same then? No, says Burton, who explains that the provider is always looking for new opportunities and ways to evolve – not, though, at the expense of its core business and values.
“We are very good at what we do and what we do at the moment is cash plans,” he says. “I wouldn’t want to do anything that jeopardises how good we are at doing that. At the moment we provide cash plans and nothing else but we have regular meetings with our membership and they seem to want more from us because they trust us and they’ve got a good relationship with us.”
Looking to the industry as a whole, Burton would like the sector to break its own glass ceiling of the ‘£1-a-week’ cash plan mantra which, in his opinion, “stifles innovation”. He would also like more brokers start to benefit from the opportunities in the voluntary market.
“We’ve got an excellent team out on the road of 26 sales staff and if companies introduced a voluntary scheme we would be able to go out and service them,” he says. “The broker would get commission simply for an introduction. That’s an area which brokers are not exploiting as much as they could at the moment.”
There’s no doubt that voluntary schemes offer huge potential – sales figures across the sector are disappointing as a whole – but where else could Health Shield grow? Through acquisition? Potentially, says Burton.
“It might happen,” he hints. “The problem with the cash plan market – and probably a number of other markets – is it’s quite parochial in parts. There’s about 30-odd cash plan schemes but it’s very difficult to get a merger because of their very nature. There’s a historical background to many of the cash plan providers and history counts for a lot so whether it will be consolidation with another or whether it’ll be a totally different organisation which will give us the ability to offer a different product to the market and develop new products…”
The options, it seems, are open – and after all those years, Burton is still looking to the long-term. So did he really not think he’d still be at Health Shield all those years later?
“No, at the time I didn’t, being honest, but I’m glad it has been like this,” he says. “I’m glad that we’ve been able to develop the society in the way we have. It’s been a joy and a privilege.”