In your interest.
Online Personal Finance Magazine
No beating about the bush.
Almost 41% of the companies use healthcare cover as a talent attraction and retention tool, while 11% use it to minimise losses arising out of employee health issues
Despite a hike in health premium costs, over 40% of Indian companies consider healthcare cover as a value differentiator for employees and use it in their hiring and retention strategy, a survey has said.
"Rising premium costs have not reduced the importance of healthcare cover as an employment value differentiator. Indian companies continue to use it as a part of their hiring and retention strategy," Watson Wyatt, a global consultancy firm, said in its Health Care Benefits survey.
"Almost 41% of the companies use healthcare cover as a talent attraction and retention tool, while 11% use it to minimise losses arising out of employee health issues," the survey said.
The survey covered 125 of India's largest employers and from across industries, mainly from the private sector, reporting an average revenue of more than Rs400 crore.
According to the survey, most Indian companies providing healthcare cover to their employees are grappling with an average 10% rise in premiums over the last three years.
"Rising healthcare costs are making corporates strive to strike the balance between increasing premium costs and their talent management strategies," Watson Wyatt India head of benefits practice, Kulin Patel, said.
To achieve this objective, it is crucial that companies constantly review and customise healthcare plans, Mr Patel said.
"It is vital that employers design appropriate healthcare plans, employ efficient ways to manage them and ensure that employees understand their value," he said.
Corporates are constantly devising different strategies to control healthcare costs, the survey said. The survey found that 74% of the companies are stressing on employee education around healthcare.
Despite rising premium costs, economic turbulence and the difficulty in maintaining an affordable healthcare cover, 58% of the companies surveyed did not deduct any premium costs out of employee salaries, it said.
"Importantly, over 46% of those surveyed did not plan to share the costs with the employees even in the coming year," the survey said.
The survey revealed that only 17% of the companies cover post-retirement medical expenditure. Post-retirement medical benefit is mainly provided by companies in the public sector, while a very small proportion of private sector companies provide such long-term benefits.
Commenting on the rise in premiums, the survey said that one of the main reasons for the rise was the advent of sophisticated medical technologies. However, employees seeking excessive care and malpractices like over-recommendation of services are also contributors to this hike in premiums, the survey said.