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GROUP HEALTH INSURANCE

WHY GROUP HEALTH INSURANCE?

The biggest reasons why group insurance is preferred and is increasingly becoming essential in the corporates is that, in group policy, the pre-existing conditions can be covered from day 1, while the normal retail health policy covers only the healthy members and moreover it comes with a waiting period for pre-existing diseases.

Statistics show that more than 35% of the corporates offer cover equal to or more than 3 Lakhs as the sum insured, plus in India, 95% of diseases get treated within 3 lakh sum insured which seems to be pretty much an adequate cover!

Group health Insurance

Differences between Individual and Group Insurance

    • Individual
    • No
    • Under Section 80(D)

    • No increase in premium because of the claim. The only increase in premium because of age slab.
    • vs
    • Pre-existing Diseases Coverage
    • Tax Benefit

    • Premium increase in future

    • Group
    • Yes
    • Can be booked under Business expenses. However, the Input Credit on GST is not applicable.
    • The increase in premium of renewal depends on the claims in the expiring year.

HOW TO CHOOSE THE RIGHT INSURANCE BROKER

Insurance brokers represent their clients to Insurer and not the other way around. They are bound by the Insurance Regulator to perform as per the terms laid to them. They need to protect the interest of the client (you) at every step of insurance, be it buying or claims assistance.Now, because they are experienced and have worked with various clients, they know the best practices and hence can help you set up the right insurance program for your organization with an ease, saving your time and effort and other nitty gritty!

Typically, you should expect the following from any employee benefit Insurance broker

  • Personalized quotes from a broad selection of top insurers and Side-by-side comparisons of plan rates and benefits
  • Special online platforms for enrolment of employees
  • Personal and unbiased claim assistance
  • Consulting on Benefits Strategy including benchmarking and alignment to corporate benefit
  • Audit of existing benefit structure with recommendations for optimization, consolidation, plan design and cost containment
  • RFP Management and in-depth carrier analysis from financials to account management to support services
  • Recommendations on specific benefits or unique situations
  • Strategy to minimize the health risk by increasing the employee engagement
  • Renewal analysis and negotiation and support on escalated questions or issues

By working with an authorized Insurance broker like Ethika, all these checkpoints can be taken care of, and you will end up saving your time and in return get a selection of quotes from top insurance companies.

Group health Insurance Policy
Group health Insurance Broker

How to decide the premium

Number of members covered

  • Self
  • Self+ Spouse
  • Self+ Spouse + Children
  • Self+ Spouse + Children+ parents

The Extent of benefits

  • Maternity benefits
  • Dental benefits
  • OPD benefits
  • Pharmacy reimbursements
  • Room cost capping
  • Health check benefit
  • Domiciliary care reimbursement

As with all things, Indian employer health benefit is shifting from that usual traditional all-expenses paid inpatient indemnity to other ways of risk or cost sharing, like high deductible plans or co-pay insurance plans.

The sum assured varies among employers but usually, a minimum sum assured is above Rs 200,000 to each employee. Various combinations of benefit limits and privileges in room types are included in the benefit design at various levels of staff. With rising medical inflation, improved access to healthcare and rich coverage in benefits, claim costs have been rising steadily.

While taking the policy one must ensure with its broker or insurer that the below covers are provided:

  • 30 Days waiting period is waived off
  • 1,2,3 years waiting period is waived
  • Pre-existing disease waiting period is waived
  • 90 days newborn baby waiting period is waived
  • 9 months maternity waiting period is waived
  • Pre and post hospitalization cover is provided
Group health Insurance Plans

In order to avail the optimum benefits, certain restrictions need to be customized, which include

  • Room Rent Clause

    Here we have room rent restriction by linking the limits to the percentage of sum insured. On the other hand, it will be better to customize this clause for considering the private or sharing room!

  • Copayment Clause

    Employees will question hospital for treatment and charges, since a certain amount will also be paid out of pockets of employees, hence it will make the employees aware as well as responsible. Percentage of copayment by an employee shall be nominal. A normal copayment of 10% of claim can reduce the claims of company by more than 15% to 20% at the end of year

  • Waiver of Internal congenital exclusion

    A part of standard exclusions, however, must be considered while negotiating the premium (For any queries on Internal Congenital exclusion please feel free to reach Ethika Insurance Broking Private Limited)

  • Disease Wise Cap

    For minimizing the claims, limiting the average cost of treatment for the common procedures like cataract surgery, hysterectomy, piles surgery, etc. By doing this, ones who need support for more serious conditions will get the timely assistance and there will be less burden on their pockets!

  • Maternity Cap

    Normal limit for maternity is 50,000 per claim both for normal and C section delivery. An appropriate segregated limit will also save claims

  • Deductibles

    Here a flat nominal amount of say Rs 1000 or Rs 2000 is applied as deductibles per claim. However, it’s advisable to apply this clause to those claims where copayment is not applied. In order to restrict small value claims and thereby reduce premium of next year, deductibles clause must be appropriately designed

  • Preferred Hospital Network

    Insurers have a pre-negotiated tariff with the hospitals and this costs less than the average treatment cost anywhere else. The overall claims can be significantly controlled if the members of the policy are encouraged to opt for the preferred hospitals from the list by removing the certain clauses (copayment and deductible). Also, with preferred hospitals, arrangements can be done for cashless treatment and also by increasing the room rent limit!

  • The company may not like to put copayment clause in reimbursement claims as they can execute control while clearing reimbursement claims

Some of the covers that can be added are:

  • Covering Outpatient treatment

    There are insurers who offer claims for outpatient treatment as well, however, one must know that the premium for outpatient treatment is as high as 80% of the sum insured. Hence, it’s advisable to review the overall benefits offered before going for any outpatient treatment and opted only in rare cases.

  • Cover of corporate Buffer

    This is of help in high-value claims which arise out of any accident or any major illness. This can be limited to any members of the family or with per incident limit or restricted to only critical illness.

  • Voluntarily Super Top Up Policy

    This is in demand nowadays. By paying the additional premium, the employees who wish to increase the sum insured limit can go for this super top-up policy. They not only get the additional limit but, also, they can avail the benefit for an additional premium paid under section 80D

Case 1: Where employer bears the cost of the premium and is not collecting any amount from the employees.

Employers who are including parents of the employees in group insurance and paying premium from their pockets shall take following steps while designing the policy. They must focus on ensuring the claims are not very high in the current year so that next year the premium will not be high.

Exercising sub limits on employee cover: The employer must work with its broker to design the policy in such a way that the employees should take standard/benchmark benefits and not luxury benefits from the policy. The policy must contain in built limits with respect to diseases. It should include most common ailment intervention like cataract surgery, piles surgery, hernia surgery, hysterectomy, Hydrocele correction, Joint Replacements, Gall bladder stone surgery, appendicitis surgery, etc which are not costly. Also, insertion of a clause that only average standard cost is allowed and anything above that will not be allowed.

Eg: For day care/ short stay procedures, like cataract, BPH surgery, for employee or the dependents, it is important to consider that the treatment cost can vary significantly depending on the facility where it is undertaken. Due to lack of standardization of cost across hospitals, a cataract surgery in a private hospital will cost around 10,000, however same procedure will cost 20,000 in a multispeciality hospital. So, in this case, only 10,000 will be allowed on submission of actual bills!

Setting a lower limit on claims: The policy must be structured in a way where employees can claim expenses which are painful to the pocket and not for the sake of claiming. The employer must set a minimum limit for seeking claim say 3,500/- this way all small claims below 3,500/- will be curbed and employees will not be visiting as inpatient just for the sake of claiming.

Hospitalization in preferred hospitals: Just setting up of minimum limit of claim is not enough. There can be a possibility that hospitals will misrepresent and join hands with employees to fetch money. Therefore, it’s important to include a clause that encourages employees to avail services in preferred hospitals.

A clause stating that employees who are availing services in preferred hospitals will get 100% claim and those who are availing at other hospitals will be getting only partial claim say 70% of bill amount. It will encourage employees to avail services in preferred hospitals and if employee chooses other hospitals, it will reduce the claim to 30%.

Preferred hospitals are those hospitals that do not have the tendencies to overcharge or inflate the bills or misguide the patients to draw money. Employer as a company can also work with different hospitals to get discounted rate of consultation in return for adding their hospital in preferred list. A list of preferred hospitals must be added to the policy.

An employer can take service of an insurance broker to get these clauses placed in policy and the claim settlements.

For any query in this regard please feel free to reach Ethika Insurance Broking Private Limited

Case 2: Where employee bears the cost of premium fully or partially

In a scenario where the employer does not want to bear the cost of premium fully or partially it can act as facilitating vehicle.

Run effective campaign to enroll: Company as an employer must run a campaign to encourage most of its employees if not all, to enroll for group insurance with parental insurance.

The campaign must be driven to inform the benefits of such enrollment and how the company is supporting by choosing the best broker, including appropriate clauses and dealing with the best insurance provider. Such campaign if lead by CEO or HR head will have more positive impact on the employees. Certain insurance brokers also create and run a campaign for its clients.

Ensure portability of policy: Employer while negotiating with insurance provider must ensure that the employee who is paying the premium must be allowed to carry forward the policy when he is moving to another company. This facility of carrying forward is called portability of policy.

Portability of policy can be a group to an individual or a group to a group. To know more about portability of policy feel free to reach Ethika Insurance Broking Private Limited.

Care for your parents with no worries of medical expenses- Reach out to us to know more about parental insurance.

Case 3: When neither case 1 or case 2 is possible:

Facilitate senior citizen health insurance:

It’s well said that if you can’t help by contribution, you can still help by giving an idea or a direction. Similarly, employers who can’t afford to support financially at least, can support their employees by arranging a facility to take the right decision. If parent’s health is taken care of, employee’s half the diversion is taken care off.

In case an employer chooses not to spend any amount on medical expenses of employee’s parents, it can at least encourage its employees to take senior citizen health insurance policy for their parents. An employer on the behalf of its employees seeks quotes for such policy and with the help of its insurance broker, support its employees to get the best insurance plan.

There are various plans and benefits offered by many insurers. Some of the plans are specially designed for people suffering from ailments like high blood pressure, diabetes, obesity etc., The main challenge is that the individual Health insurance is only for healthy people. One must declare the family history and current health conditions while taking the policy. The insurer, then decides to cover or reject the proposal. Even if they decide to cover the existing ailments, it gets covered after certain waiting period. This makes tough for senior citizens to get the appropriate health cover.

Senior citizen health insurance policy is designed to serve the health needs of senior people who have crossed 60 yrs. of age. These policies cover hospital charges and medical expenses incurred due to sickness or injury due to an accident. More over in senior citizen health policies the waiting period set for pre-existing diseases is also lower than the regular individual health policies.

Certain Banks also offers Group Mediclaim policies for its customers and the premium are relatively lesser than the normal retail policies. Employers can tie up with banks and offer those policies to the employees.

More over employees can claim additional tax deductions under section 80D for the premium paid for the health policy taken for parents also.

Leverage technology-Most of the Insurance brokers including Ethika offer you a complimentary enrolment tool so that you can manage the enrolment period* online seamlessly and conveniently. With an online platform, the new employee can be onboard. The premium for additions and deletions is generally calculated on a prorated basis and the credit or debit is made in the CD balance account. one can see the balance anytime online for their policies. Online tool helps in managing the policies, adding or deleting the members without any hassle just with a click!

Leverage technology-Most of the Insurance brokers including Ethika offer you a complimentary enrolment tool so that you can manage the enrolment period* online seamlessly and conveniently. With an online platform, the new employee can be onboard. The premium for additions and deletions is generally calculated on a prorated basis and the credit or debit is made in the CD balance account. one can see the balance anytime online for their policies. Online tool helps in managing the policies, adding or deleting the members without any hassle just with a click!

Less than 8% of employees avail the Insurance benefits. Many of them may not be even aware that such benefits are available, that’s why proper employee communication is important, it increases the overall perceived benefit among employees about the benefit program offered by the employer.

The Importance of Employee Benefits Communication is “The “Most important part of a company’s HR function. The employees should be aware of the overall compensation and not just the cash value of the salary! That’s where benefit communication plays its part by helping the employees to understand the value of their employment.

A good, thought through employee benefits communication program is important as it tells the employees what options are available, what to choose wisely, what mistakes to avoid, like not selecting the plans that will later lead to increased out of pocket costs putting a burden on their pockets

When your employee is having questions about the claims, most of the Insurance brokers, direct them to contact the health insurance company’s customer service department or third-party administrator. If employees feel that their concerns are not addressed, only then they will contact your health insurance broker for help (if you worked with one). Your broker can simplify and also help you understand how the benefits work and from time to time can help you settle billing disputes if any arise in the due course.

Outsourcing the management of your Benefits program has several advantages. Crucial personnel need not be burdened with additional, unfamiliar responsibilities and your employees are assured of timely, professional assistance and compassion. Most of the Insurance Brokers provide the above service.

Ethika believes in ‘serve to care and serve with compassion’. We are sensitive to claimant’s losses and his expectations from an insurer. Our exposure to diverse cases of claims redressal has shown us that each claim is unique in terms of conditions and requirements. We direct all questions or concerns raised by your employees to us and therefore, are in a better position to have control over the process.

Many of your employees when they resign or retire, will be looking for a personal health insurance policy. When they buy the policy from the market, it will come with many restrictions such as

  • 30days waiting period
  • 1/2/3 years waiting period for specific illness1/2/3 years waiting period for specific illness
  • Waiting period for Pre – Existing disease.

Now IRDAI has allowed waiving of those waiting periods in personal health insurance policy, if the person is covered in the group policy for that many years.

For example, if the employee was covered under the group health insurance policy for 4 years and he never claimed, he can apply for porting the policy from group to retail health insurance policy at least 45 days before leaving the company. Upon acceptance by the insurer, the new personal health insurance policy is issued waiving off the waiting periods.

The porting is done only when the proposal is satisfying the underwriting guidelines of the insurer for retail health insurance.
Usually, the group to retail porting is done with the same insurer.
Please check the link of the IRDA circular on portability here
https://www.irdai.gov.in/ADMINCMS/cms/frmGuidelines_Layout.aspx?page=PageNo3987&flag=1

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