Sickness absence is a major factor for businesses and is costing billions every year in the UK alone. This important fact highlights the need for businesses to be prepared for sickness absence, having employee illness diagnosed quickly and effectively to get employees back to work as soon as possible. Private medical insurance (PMI) can help assist businesses in this area and is an important consideration for any organisation, no matter the size.
In the past, PMI was considered a luxury employment perk for those only in the higher echelons of the business, those sitting at director or other managerial levels. As the years went by, organisations started to see the additional benefit of providing health insurance schemes to their wider workforce. PMI acts as an excellent absence management and staff retention tool, helping employees with the cost of private treatment for short-term illness and injuries. The level of benefits an employer can offer an employee can also be a key driving factor in recruiting key members for your staff.
Tailoring corporate PMI
Paul Ashcroft, the principal and head of sales/health and benefits scheme at consultancy Mercer pointed out that the corporate PMI market has changed considerably over the last twenty-five years. The schemes available to businesses have changed considerably, with the way that they are now very customisable where you can pick and choose what you want included or not. Employers also have the option to put an excess on the scheme so employees are required to pay a small amount of the overall claim. Options for employers include basic cover plans providing aid for acute, curable short term illnesses and injuries where treatment is generally quick; on the other end, there is more comprehensive cover available, looking after the needs of those with long term illness, such as cancer.
The costs of corporate PMI
One thing that immediately jumps to mind when considering a PMI scheme in the workplace is the perceived cost of such a venture, the reality is that there are a number of ways to keep the cost down. As mentioned previously, businesses now have the ability to tailor their packages which also helps to keep the costs down, so too does employee excess. You could also offer different tiers in levels of cover as you go down the organisation from directors and mangers, down to the remainder of the workforce. Some organisations also use specialist intermediaries and brokers to help them find the best deal available. There are also tax implications to consider when deciding upon PMI cover, as it can sometimes be more cost appropriate to go for a corporate healthcare trust (HCT) for larger enterprises.