The health insurance and protection markets have reacted with cautious optimism to the government's spending review.
While most industry representatives recognise there is now a significant opportunity for co-operation with the public sector most also realise this must be taken in the context of budget constraints.
It appears that with purse strings being held so tightly, any private sector involvement with public services must show a marked saving on expenditure.
Richard Sear, CEO of health insurer National Friendly believes financial strains are already starting to show on the NHS and is encouraging the private and public health services to work together to improve problems such as waiting times.
"As an organisation that supports the work of the NHS, we are pleased to see that the coalition government is standing by its commitment to protect it from spending cuts," he said.
"However, we cannot deny that the pressure on the NHS and its increased strain on frontline services are only just beginning.
"With waiting times targets scrapped and the institution on a countdown to save £20bn, there has never been a more poignant time for the private healthcare sector to prove its worth - through demonstrating to customers how they can combine private services with those provided by the state," he added.
The story of the day for the protection industry was the limiting of contribution based Employment and Support Allowance claims to just one year for those in the work related activity group - something which could affect a million people.
John Ritchie, CEO of group risk provider Ellipse, feels this leaves a serious gap for people who may be realising the limits of state support and that the austerity drive provides an opening for group risk if it invests in the right areas.
"Group life, critical illness and income protection cover have always been an important part of any benefits provision, but the implications of the spending review mean that now more than ever it is vital employees have access to and are fully informed about the workplace support that's available to them," he said.
"The announcement effectively signals the long-term withdrawal of the state from the provision of certain benefits and, as a result, could potentially spark the resurgence of the group benefits market.
"But it is up to the industry to better market itself and educate employees about the help available in order to see good on that opportunity - and that takes investment," he added.
The measures mean almost half a million public sector jobs are set to go over the next four years, whether through redundancies or natural wastage as vacant positions remain unfilled.
This will mean, in theory, a similar workload will have to be carried by a much smaller workforce.
As Aaron Ross, CEO of absence management services provider FirstCare, explains, the staff left behind should not be forgotten.
These are the ones who could feel a notable impact and may be most in need of the benefits provided by group risk and employee benefit services.
"They will be required to take on extra responsibility and workload which could have an effect on their personal lives and health," he said.
"With that in mind, one thing I would have liked to have seen is more emphasis on reducing absence. Employee absence is such a waste of valuable resource and money.
"Through taking simple steps it is possible to reduce absence while supporting employees back to health," he added.
In more general terms, however, Ross suspects the worst may still be yet to come before public spending and the deficit are fully under control.
"As a tax payer the most concerning aspect for me is that even with these substantial budget reductions there is still significant overspend for the foreseeable future," he said.
"We are, and will continue, to spend more on public services than we receive in collectables. This is not sustainable. This of course, beggars the question ‘have we really done enough to reduce the deficit?'
"In Osborne's defence I don't think he could have done anymore this time round but the numbers just don't add up, the only conclusion that can be drawn is that there will be more to come," he concludes.
