Employee Group Health Insurance – Key elements for employers.

Employers nowadays are expected to offer Group health insurance to their employees. It is not mandatory, but expectations make it a must for employer to offer to retain the employees. Popularly known as GMC or GHI, it is a very important buying process meticulously looked at by professionally run organizations. It is a powerful tool for Indian businesses to safeguard the health and well-being of their employees.

Structure and sum assured:

GMC is a group policy essentially in the name of the employer and the lives covered are all the employees. The company pays for the premium and negotiates the price and coverage. GMC is offered to employees with families as groups or families and parents as groups. Often employees find it easy to add parents to family groups because health insurances for elderly are not easy to get or don’t offer required features.

The cover offered is 5 lakhs to 20 lakhs per family based on seniority and as per employers’ norms. The is a concept of corporate buffer which acts as an overall cover which can be applied for specific employee’s family. The overall sum assured therefore is the number of family units multiplied by the respective sum assured plus corporate buffer.

Cost of health insurance:

The cost is usually borne by the employer on behalf of the employee and this facility is often considered as benefits of working in professional company. Each family unit gets a sum insured fixed by the employer.

There are employers who want employees to bear a certain percentage of the premium cost, and employers bear the rest of it. Some employers bear the entire cost and do not pass it on to employees.

Typical Insurance Covers:

• Room rent is usually 1%-2% of sum insured for normal room or 2%-4% of sum insured for ICU. Room rent includes bed charges, duty doctor, nursing charges and service charges or amenities (if any). ICU charges additionally cover general medical support, medical devices expenses, critical care nursing and intensivist charges.

• Co pay employers can opt for 10% to 50% co pay in the claims based on employer’s company policy.

• Waiting Period: Unlike retail health insurance there is usually zero waiting period for preexisting diseases in group medical cover. This is a very useful feature for some insured who have preexisting diseases as they normally have 1 to 3 year waiting periods for claims in their retail polices. Often there are initial waiting periods and specific illness waiting periods in retail health polices which are generally not applicable in group polices.

• Materny cover: most insurers offer pre and post-natal care expense, baby expenses, mother expense etc. for both normal and C section baby delivery with specific sum insured limits.

• Emergency ambulance charges and even air ambulance covers are available under this policy.

• Day care procedures like cataract etc. charges coverage is offered by certain insurers.

• Pre and Post hospitalization charges are also covered under this policy based on features available from insurance company. Mostly 30- 60 days pre and post hospitalization charges are covered.

• Other diseases that are covered include Terrorism and Congenital Conditions like Internal congenital diseases are covered up to 100% of SI.

• Some of the surgeries and treatments that are NOT covered by almost all insurance companies are Lasik Surgery, Aayush Treatment, Domiciliary Hospitalization, Psychiatric ailments, and Organ Donor Expenses.

• Modern Treatments that get covered but with limited sum insured are Uterine Artery Embolization and HIFU, Balloon Sinuplasty, Deep Brain stimulation, Oral chemotherapy, Immunotherapy, Intra vitreal injections, Robotic Surgery, Stereotactic radio surgeries, Bronchial Thermoplasty, Vaporisation of the prostrate, IONM - (Intra Operative Neuro Monitoring), Stem cell therapy, Cyber Knife Treatment, Gamma Knife Treatment, and Cochlear Implant treatment.

Tax Benefits:

Employers can take this premium payment expense before calculating the profit and therefore save taxes to that extent.

Customization:

The biggest advantage of the GMC is the flexibility of choosing specific cover from the list of covers offered, this helps in selecting the appropriate feature for specific organization requirements.

Claims Assistance:

The insurance companies have network hospitals where the treatment cost is paid off once the insurer approves the claim without the employee paying anything from his/her pocket, this is called cashless claim. Alternatively, if a given claim is from non-network hospitals, then the claimant must pay the hospital and submit documentation for reimbursement from the insurance company.

In the case of the co pay feature in the GMC, the defined co pay percentage must be paid by the claimant.

Renewal and Tenure:

The GMCs are typically available for 1 year. The cost of GMC next year is a direct function of claims made in the current year. So, if one large claim hits the GMC policy the premium in the next year shoots up. This is one of the reasons for some employers to do co pay or ask employees to share the cost of premium payment.

Conclusion:

GMC is a powerful tool for employers to retain employees and offer them financial support at the time of medical emergency. This also promotes the health and wellbeing of employees. The biggest advantage of GMC is the flexibility it offers in feature selection a facility not available in retail health policy and the claim supported even for the preexisting diseases.