Liverpool health cash plan provider Medicash reports record revenues of more than £41m but the plunging value of its investments turns an £8.5m profit last year into a £2.2m loss. Tony McDonough reports
National health cash plan provider Medicash is reporting record revenues of £41.1m for the 12 months to December 31, 2022, a rise of almost 20%.
During the year Liverpool-based Medicash signed 125,000 new policyholders, taking the total to 482,000. In June this year it said a further increase in policyholders had taken the total above half a million – the highest level in its history.
However, in its annual accounts filed at Companies House in the last few days, Medicash admitted its operational profit of £2m (down from £3.1m in 2021) had been wiped out by a fall in the value of its investment portfolio.
This led to an overall pre-tax loss of £2.2m. In 2021 the company reported a total pre-tax profits of £8.5m.
Medicash insists this £4.2m loss on the value of investments, which it says was due to a combination of high inflation and the Russian invasion of Ukraine, is from its ‘non technical account’ and does not affect its day to day business.
In the directors’ report, the business, which employs more than 100 people, said the growth on its main technical account had been “achieved in a sustainable way”.
It added: “The business is not reliant on any profits from the non-technical account, meaning short-term shocks that arise from events such as those encountered in 2022 do not impact trading activities of the business.”
Founded in the charity hospitals of Liverpool in 1871, Medicash has become the UK’s oldest and largest corporate health cash plan provider.
In June it announced it was to give £2.1m to NHS hospitals and facilities across the North West over the next four years. This will be through its charitable arm, the Medicash Foundation.
In July Medicash, which has been run for several years by chief executive Sue Weir, said it had acquired its headquarters, the five-storey One Derby Square in Liverpool city centre, for £12m. This will save more than £200,000 a year in rent.
Formerly Pearl Assurance House, the 70,161sq ft mixed use property is in Derby Square on the corner of Lord Street and Castle Street. Medicash moved in 12 years ago relocating just yards from Lord Street.
It occupies one of the five floors while the remaining four floors house 14 different tenants. They include the barristers of Exchange Chambers.
In the annual report it also said: “We continue to see an increase in company paid policyholders as employers understand the need to offer their staff effective health and well-being solutions.
“The group’s long-term strategy is focused on growing its corporate book of business. We have continued to see a gradual decline in the number of direct policyholders and this is consistent with the trends seen across the rest of the health cash plan market.
“Despite the decline in individual policyholders and competitive pressures, we are pleased to report the continued growth and premiums written and policyholder numbers.
Medicash paid its directors a total of £760,000 in salaries and pension benefits in 2022, down from £820,000 in 2021. Its highest paid director received salary and pension benefits totalling £349,000, a significant rise from the £259,000 paid in 2021.