It’s medical insurance renewal time. That letter lands on your desk. How do you respond?
Employee medical insurance, now a mandatory requirement in parts of the UAE and likely to become one throughout the region in years to come, is a major financial consideration for any business. Push the renewal letter aside, allow the policy to roll over for another year unchanged, and you will not only be neglecting a major contributor to your bottom line but potentially leaving your workforce inadequately provided for.
HR professionals and SME owners who treat insurance renewal as an important time in their annual business planning can score a major advantage over those who don’t, in terms of saving money, improving the service they receive and, by extension, improving employee satisfaction and recruitment appeal. So how should you approach renewal time, what questions should you ask and what are the indicators that you’re getting good value for your business? The following checklist sets out the six most important considerations to help you get the best from your business health cover.
1. Are you getting good service?
The first question to ask when considering any business relationship. Consider the service you’ve received over the last 12 months. Look back through your records for any instances when your provider has let you down, or gone out of their way to find a solution. Take both positive and negative experiences into account. Consider things such as how quickly they responded to claims and the general ease of the transaction. Was the cover they recommended adequate for your business? Was it too much or too little? And what is the quality of healthcare provision your employees have received?
The first question to ask when considering any business relationship. Consider the service you’ve received over the last 12 months.
According to a recent white paper on the UAE’s healthcare market, there’s a gulf of difference when it comes to IT readiness among healthcare providers. With that in mind, it stands to reason that the service style (and speed) you receive from each provider may vary dramatically.
Once you’ve considered the service you’ve been receiving, carry out a review of the wider market to gauge the level of service available from other providers. A good tip for getting the best value service is to look at no more than two separate brokers and split the providers they work with to get the best prices and benefits for your firm.
2. Are you making ‘out of network’ claims?
You can learn a lot about the suitability of your cover by reviewing your claims history for the previous year, if they are available. A key detail to look out for is claims that were made ‘out of network’. This means the medical care has been provided by a centre that is not contracted to your insurer and the simple implication is that it costs more to the individual member availing treatment out of Network. ‘In network’ healthcare providers have a relationship with your insurer that includes subsidised costs. A study in the US found that out of network procedures were charged at between 118% and 1,382% more than the same care provided in network. And that will have an impact on your premiums.
So a key question to ask your insurance provider is the extent of their network. This will help you to gauge the likelihood of having to go out of network for the treatment your employees might require.
3. Is your company changing?
Your employee healthcare cover needs to fit the size of your business, so if you’ve expanded since your last renewal, or you’re planning to expand, it’s essential that you carry out a full review of your policy. Is the business moving into new territories? Are you adding new segments to the business to provide new services? Or have you made these changes already? You need to communicate any changes in the size or structure of your business to your insurance provider, otherwise you’re likely to find that you’re inadequately covered.
4. Are you compliant with local regulations?
Healthcare insurance law in the region has been going through a fairly major upheaval in the last few years. Abu Dhabi introduced mandatory healthcare insurance for businesses, and Dubai followed suit. The UAE’s free zones have separate insurance jurisdictions too, so it’s important to make sure you’re up to date with the regulations where you are and that your insurance provision is compliant. Failing to comply could lead to a fine or, worse, the suspension of your business licence. Your broker should be able to advise you but the more you can find out for yourself, the stronger the position you’ll be in.
Healthcare insurance law in the region has been going through a fairly major upheaval in the last few years. Failing to comply could lead to a fine or, worse, the suspension of your business licence.
5. Are your staff keeping fit?
Including a wellness programme at renewal time could have a two-fold benefit, reducing the number of hours lost to ill health, and thus increasing productivity, and reducing the number of claims per year, which in turn will help to keep your premiums down.
If you’re hesitant about the cost of investing in a wellness programme, consider the case of American company H-E-B. As a result of its wellness programme, H-E-B moved 10% of employees from the high and medium risk categories to low risk, which yielded an estimated six-fold return on investment. It also reported that claims among high-risk participants in the scheme were still around $1,500 lower than among non-participants. So the inclusion of a wellness programme should be seen as an investment rather than a cost.
6. Have you shopped around?
Staying loyal to one insurer may feel like the right thing to do but it isn’t necessarily best for your business. Every customer has the right to shop around and by doing so you will strengthen your hand. In a crowded market, insurers will be hungry for your business, so you’re likely to be offered an enticing deal by a provider who’s insuring you for the first time. And if you do end up staying with the same provider, the knowledge that you’ve been looking elsewhere should be enough to make them pull their socks up and make sure they’re doing everything they can to earn your repeat business.
Relish the renewal letter
Next time that insurance renewal letter lands on your desk, don’t push it away to one side. Grasp it as an opportunity to do something brilliant for your business. The time you put in to assessing your current insurance provision and exploring the market for better alternatives will pay dividends, both in terms of the bottom line and workforce fitness and morale.
The time you put in to assessing your current insurance provision and exploring the market for better alternatives will pay dividends, both in terms of the bottom line and workforce fitness and morale.
These are key elements in the success of any business and the power to get them right lies in your hands. Follow these tips and you can put the entire business on a more healthy footing.