Who the NHS covers

The National Health Service is the starting point for anyone living in the UK, but it is not one organisation. Health is devolved, so England, Scotland, Wales and Northern Ireland each run their own NHS service.

Hospital care at no charge rests on being “ordinarily resident”, which means living in the UK lawfully and on a settled basis, generally with indefinite leave to remain or status under the EU Settlement Scheme. An employee who came on a visa will usually have paid the immigration health surcharge with the application, and from the visa’s start date uses the NHS on the same basis as a resident.

Everyday care begins with registering at a GP practice, which can turn away a new patient only for non-discriminatory reasons. GP registration alone does not make someone entitled to hospital treatment at no charge. Accident and emergency is the part open to everyone: A&E treatment carries no charge whatever the patient’s residence status, although care after an emergency admission falls outside that rule.

Four nations, different charges

Where in the UK your employee lives changes what they pay out of pocket. Prescriptions carry no charge in Scotland, Wales and Northern Ireland. England charges per item, with exemptions for some groups.

In England, even a resident fully entitled to NHS hospital care pays charges for prescriptions, dental treatment and eye tests. Keep that in mind when weighing a dental or optical extra for someone in England. Our guide to dental, vision and life benefits explains how those extras fit into a package.

So the first fact to collect is the nation: an employee in Edinburgh or Cardiff starts from a different position than one in Manchester.

Payroll comes before benefits

An employer with staff in the UK operates PAYE and pays secondary Class 1 National Insurance contributions, the employer’s share, on employees’ earnings. HMRC’s 2026 to 2027 employer guide covers businesses based abroad.

A US company with no UK residence, presence or place of business might not owe employer contributions at all. The employee’s contributions still have to be accounted for, often through a direct payment scheme. The picture changes for an employer based in the EU, the EEA, Switzerland or Gibraltar: HMRC treats it as having a UK place of business, so it pays employer contributions and runs PAYE.

How HMRC taxes medical insurance

Private medical insurance adds faster access to specialists and private hospitals on top of the NHS. When an employer pays for it, HMRC generally treats it as a taxable benefit in kind. If the employer arranges the policy and pays the provider directly, it reports the benefit on form P11D and pays Class 1A National Insurance on its value.

Paying the employee instead is different: reimbursing medical bills or handing over a cash allowance for medical costs counts as earnings, so it runs through payroll for PAYE tax and Class 1 contributions. Salary sacrifice does not escape the charge either, because HMRC leaves medical insurance through salary sacrifice off its list of exemptions.

Some smaller health benefits are exempt: one health screening or medical check a year, eye tests and glasses needed for screen work, flu jabs, treatment for injuries or diseases caused by the work, and treatment abroad for staff working overseas. Treatment that helps an employee return to work after at least 28 consecutive days off sick can also be exempt up to a set limit.

A top-up, not a replacement

In countries with a compulsory local scheme, an international plan has to fit around it. The UK has no such scheme to replace. The NHS covers residents and visa holders who have paid the surcharge, so an international or global plan for a UK employee works as a top-up, adding private and faster care. Other countries are compared in our overview of international health insurance for remote employees.

Who sells the cover matters too. Under section 19 of the Financial Services and Markets Act 2000, known as the general prohibition, nobody may carry on a regulated activity in the UK, including effecting or carrying out contracts of insurance, unless authorised or exempt. The Prudential Regulation Authority and the Financial Conduct Authority authorise insurers. Whether a particular plan can be offered to someone living in the UK is for the insurer to confirm.

Employee, employer of record or contractor

To employ someone in the UK, a US company runs UK PAYE itself, either through its own UK entity or as an overseas employer. Another route is an employer of record, which becomes the legal employer and handles payroll and benefits. Our guide to health coverage for EOR staff and contractors abroad explains who arranges cover under each model.

Contractors sit apart. When the worker trades through their own company and the client is wholly overseas, with no UK residence or permanent establishment, the client-side off-payroll rules known as IR35 do not apply. The worker’s own company decides whether IR35 applies, and the contractor arranges their own health cover.

Employee or contractor status carries tax consequences in both countries, so ask a UK tax adviser to review the setup before signing. The US side of the question is covered in employees vs. independent contractors in California.

Asking us for an introduction

For UK health cover, our role is the introduction. Use the quote form on this page to tell us that your employee is in the UK, which of the four nations they live in, how many people you employ there and whether family members need cover. We will pass it to a benefits partner that works with international and remote teams.

From there, the partner and the insurer work out eligibility, plan options and pricing with you. On the US side of the same hire, we can request employment practices liability and cyber insurance quotes that reflect staff working abroad, and the insurer decides once it has reviewed the file.

A few useful answers

Common questions

Is private medical insurance a replacement for the NHS?

It works on top of it. The NHS covers residents and visa holders who have paid the immigration health surcharge, and private medical insurance adds faster access to specialists and private hospitals.

Is employer-paid medical insurance taxable in the UK?

Generally, yes. HMRC treats it as a benefit in kind: an employer that pays the provider directly reports it on form P11D and pays Class 1A National Insurance on its value. A cash allowance for medical costs goes through payroll instead.

Can a UK employee on a work visa use the NHS?

Usually. Most visa applicants pay the immigration health surcharge with their application and can use the NHS on the same basis as residents from the visa start date. Some are asked for a share code to prove their status when they seek care.

Can Mithril1 help us cover a UK employee’s health care?

We can introduce you to a benefits partner that handles health cover for international and remote teams. Send the details through the quote form, and the partner takes it from there, with the insurer setting eligibility and price.

International Health Insurance for Remote Employees in the UK