Self-fund or insure: what's the best way to pay for private healthcare?

Private medical care is becoming increasingly common as more people choose to pay for treatment themselves.

Insurance broker Howden Life & Health surveyed 2,000 people and found the equivalent of almost 15 million people nationally used their own money for private treatments over the past five years, forking out an average of £6,000.

But with the average monthly premium costing as little as £36 per month, are you better off taking out a health insurance policy instead? Here, Which? takes a closer look to find out.

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Rise in going private

Long waits for NHS appointments have prompted a growing number of people to explore private options for diagnosis and treatment. 

Frustration among patients means many people are choosing to go private for diagnosis and treatment. The latest report by the Independent Healthcare Provider Network found 71% would consider using private healthcare if they needed treatment in the future – up from 64% two years ago.

The survey also showed appetite for private healthcare was particularly strong among 35 to 44-year-olds, with 49% saying they expected to use it in the coming year – a jump of more than 10% in just the past 12 months.

• Find out more: is private healthcare worth it?

Is health insurance worth it?

It goes without saying that paying for private treatment can burn a sizeable hole in your pocket.

Our latest research found that a private GP appointment will typically set you back between £40 and £90, but costs can easily spiral into the thousands if you need surgery. According to data from LaingBuisson, a cataract operation will typically set you back around £2,900 per eye, while a hip or knee replacement is more like £14,000.

With private medical insurance (PMI), you pay a monthly premium and in return the insurer contributes towards the costs of private treatment. This can reduce the risk of ending up with a shock bill. 

However, PMI doesn't suit everyone's needs, and there are significant drawbacks to funding treatment this way. We have rounded up the main pros and cons to help you decide if it's right for you.

Pros

• Avoid a big bill If you don't have the funds, paying for private treatments with your own savings could be a struggle. Private health insurance policies also usually pay for your treatment directly with the provider, so you won't need to pay at the clinic and reclaim the costs later. 
• Wellness perks Private health insurance often includes extra benefits aimed at promoting a healthy lifestyle, such as discounted gym memberships or free access to mindfulness apps. 

Cons

• Expensive The cost of PMI will depend on the level of coverage and your personal circumstances, such as age, medical history and where you live. For example, our research into private health insurance costs found that a 55-year-old living in the Midlands stands to pay more than £200 a month for comprehensive cover. That rises to more than £300 if you're over 65.
• Not everything is covered: Chronic or incurable conditions are rarely covered and neither are injuries from some high-risk activities or pregnancy. Even people with certain jobs, such as oil rig workers, aren't covered. Pre-existing medical conditions are also usually excluded.
• Some treatments may be extra: Basic policies only cover treatment for patients who are required to stay in the hospital for at least one night. If you haven't been admitted and are an outpatient, then the cover is extra.
• The excess can be high: Even if your insurance agrees to pay the cost of treatment, there is usually an excess to pay, and it could still be hundreds of pounds, depending on the level of cover you've chosen.

For help finding the right provider and policy, visit our guide to the best private health insurance.

Is it better to self-insure?

A surprising number of patients are paying for private healthcare themselves. Howden Health & Life's survey found that 27% paid ‘out of pocket’ for medical treatment over the past five years. On a national scale, that totals just over 14.6 million people.

Of those, 59% paid for their own treatment, 36% funded treatment for their child, and 35% funded treatment for their partner. Meanwhile, 24% paid for their parents and 9% for another family member. Some of the key reasons for self-funding include diagnostic tests and scans (22%), injuries (19%) and mental health services (15%).

The advantage of paying for private treatments yourself is that it offers more flexibility than health insurance policies, which place constraints on the choice of clinics, consultants and treatments.

Rather than pay an annual premium to an insurer, you could pay the same amount into a savings account. With interest rates still high, consider opening an easy-access or regular savings account. For the latest rates, take a look at our guide to the best savings accounts.

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Other ways to pay

Health insurance isn't the only payment option for patients who want to be treated privately:

Health cash plans

Healthcare cash plans are generally much cheaper than private health insurance, but are only designed to cover everyday health expenses such as dental work, glasses, contact lenses or physiotherapy.

You pay a monthly premium, and the cash plan provider will reimburse you for expenses covered in the plan. There's an annual limit on how much you can claim, with more comprehensive policies having higher limits.

Credit card

Paying on a credit card means you can repay the full amount in manageable chunks over several months, especially if you get an interest-free purchase credit card.

The danger is that if you don't pay off the balance in full and don't have an interest-free deal, you'll end up accumulating interest on the remaining amount and spending significantly more than the original bill.

Credit cards also have borrowing limits, and if your dental bill ends up in the thousands, you may find yourself unable to cover the full amount.

Personal loan or finance plan

If you’re facing a high upfront cost, a personal loan or finance plan arranged through a healthcare provider could help spread payments over a longer term.

Some private hospitals, such as Nuffield Health, offer interest-free repayment plans for certain procedures, typically over six to 12 months. Others work with third-party finance companies, which may charge interest depending on the loan amount and term.

Before signing up, compare the total cost of borrowing and check for any fees or early-repayment charges. If you’re considering a longer repayment period, a low-rate personal loan may be a more cost-effective option than in-house financing.

• Find out more: best personal loan rates 2025.