If the spiralling cost of employee health insurance in Qatar is forcing you to consider cutting back on the quality of the healthcare package you offer, think again.
Providing your workforce with a cut-price healthcare plan might help to reduce expenditure in the short term but it’s likely to cost you in the long run. Any initial savings are going to be far outweighed by adverse effects such as absenteeism and staff morale problems, which will hit your bottom line and sabotage the business as a whole.
Healthcare and cost – the relationship
So how exactly does cutting your healthcare spend affect the cost-effectiveness of your workforce?
1. A reduction in productivity: It’s no great surprise that healthy workers have been shown to be more productive and engaged at work than unhealthy workers. One UK study found that unhealthy employees who take time off sick and underperform in the office as a result of ill health (known as presenteeism) are costing small businesses an average 27.5 working days every year.
And as reported by the Oxford Business Group, Qatar’s growing number of SMEs are likely to take a much more prominent role in its economy. This means, if you are one of that number, you need to be best placed to take advantage of any opportunities.
2. A drop in talent: According to a 2016 report, Qatar’s healthcare expenditure is set to double to USD 8.8bn by 2020. Increased demand will be exacerbated by the rise in long-term problems such as diabetes, obesity, and heart disease. It makes sense, then, that healthcare would be one of the most valued benefits among employees.
When it comes to both attracting new talent and retaining the talent you already have, offering a comprehensive healthcare package is one of the most powerful tools a business can employ.
When it comes to both attracting new talent and retaining the talent you already have, offering a comprehensive healthcare package is one of the most powerful tools a business can employ.
Keeping in mind Qatar’s Social Medical Insurance Scheme, which is expected to be reintroduced shortly, health insurance could be made mandatory for expatriates and visitors– and employers may be required to provide cover for basic health services. This being the case, making a virtue of your obligations by offering a superior healthcare scheme can help attract the best overseas talent.
3. The virtuous circle: The greater the satisfaction and wellbeing of your employees, the lower your staff turnover and the more successful your business will be. This seems to be in tune with Qatar’s corporate culture today. Let’s take the example of Qatar Steel: a few years ago it announced that it would be focusing more on employee development and wellbeing, in line with the Qatar National Vision 2030. It can be no coincidence that it saw its employee attrition rate fall from 15.8% in 2015 to 2.7% in 2017.
Think of your workforce as a machine that’s vital to the production output of your business. If a machine faltered or broke, you would fix it immediately. Indeed, you would make sure the machine was regularly maintained so that it never did falter. Your workforce is every bit as vital.
How to cut your healthcare costs without failing your workforce
A survey by the US National Association of Professional Employer Organizations reported that 41.7% of employers consider healthcare costs to be the most serious challenge to their bottom line.
While Qatar’s economy is known to be one of the world’s strongest, it is not immune to regional fluctuations. For example, GDP growth slowed in 2017 to 1.6%, the weakest in over two decades. Naturally any economic downturn will impact businesses, so there is certainly no call for complacency when it comes to cost management.
While Qatar’s economy is known to be one of the world’s strongest, it is not immune to regional fluctuations.
But there are ways to keep the amount you spend on employee healthcare under control without compromising the quality and appeal of the benefits you offer.
For example:
Introduce a co-pay system: Employers can include a co-pay system on their health plans, such as a 20% co-pay on all outpatient treatments. This means the member pays 20% of the cost and the insurance company pays the remaining 80%. By making employees take a share of the financial liability, co-pay systems help to reduce the misuse of healthcare systems, thus reducing the amount of medical costs incurred.
Provide home-working flexibility: There is much support for the idea that companies offering the flexibility of working from home when needed can increase productivity, improve mental wellbeing and decrease stress. A recent survey from a Canadian company found that only 17% of those who work from home are affected by workplace stress, compared to 37% of those who work in cubicles and 32% of those who work in open plan offices.
For Qatar, where depression and stress are on the rise, this is an interesting finding. There are indeed signs that the government is starting to take stress-related illnesses more seriously. Its mental health law, introduced in 2016, states: ‘Mental Health is defined as a state of mental and social well-being where the person can make achievements depending on his personal capabilities, and be able to handle the normal stresses of life and can work productively to make a contribution to the community.’
This kind of thinking should translate to the workplace if you want happier, less stressed workers who can make a real contribution to the success of your business.
Stick to contractual hours: Scientific research shows that our brains are not designed to concentrate intensely for eight hours at a time. Due to the ultradian rhythm, a cycle that governs both our sleeping and waking lives, the brain can only focus for 90-120 minutes before it needs a break. After this time a 20-30 minute break is required to refresh and revitalise the brain in order for it to perform well at its next task.
The brain can only focus for 90-120 minutes before it needs a break.
So instead of instilling a workplace culture of grafting for excessively long hours, it is more cost-effective to encourage your employees to stick to the normal working day and enable them to take regular breaks to recharge.
Employee healthcare – a sound investment
Healthy, engaged employees provide a competitive advantage for any company, so an investment in workplace wellbeing makes sound business sense. Reducing your costs by cutting back on healthcare is a false economy, negatively affecting both your staff morale and your bottom line.
Seek expert advice from insurance specialists and healthcare providers to work out the best strategies to enable your business to deliver quality, cost effective healthcare, which ultimately will benefit all.