Medical Benefits Get Booster Shot

PUMPING IT UP

Companies line up huge changes in medical schemes in an attempt to keep the flock home and attract talent. While some are offering flexi packages, others are making concierges available

This year, a healthy employee will be the sign of a wealthy one. With a weak economy crippling increments and promotions, companies have started betting on health and medical benefits to rein in as many as possible from shifting loyalties. They are also looking at attracting talent with a revamped medical benefits package. "Medical inflation is shooting up and companies have realised this is the right thing to do. Not all groups run hospitals where an employee's healthcare bills are subsidised, so the next best option is to provide them with as many benefits as possible to keep competitors at bay," says Anand Shankar, CEO of Aon Hewitt India. Twice as many clients have approached the consulting firm in the first two months of this year compared with last year to tweak their healthcare policies. 

"The window to keep giving compensation is closing and this has been a slow year. One can not throw in increments and these are smart ways of working around it," adds a senior executive of a consulting firm, who does not wish to be named. 
For the first time this year, Wipro Technologies has lined up huge changes in its medical reimbursement policy. These include an increase in medical insurance from Rs 3 lakh to Rs 5 lakh across all levels, reimbursement for personal medical policies and OTC drugs, and the option of continuing with some of the policies even after leaving the company. 
The firm has done away with clauses where overnight hospitalisation is required, since there are treatments that do not require the patient to visit a hospital for more than a few hours. The idea emerged from the fact that many of its employees have been opting for alternate therapies and treatments like invitro fertilisation. 
"In the past few months that the policies have been introduced, attrition has definitely been lower, but it is difficult to correlate this only with medical benefits," says Samir Gadgil, general manager, talent engagement and development. 
Retention strategy is entwined in some of the policies. For example, while an employee can continue with his medical benefits even if he leaves the company, he would have to pay a much higher premium than the subsidised one the company offers. "The thought of paying a high premium could be a deterrent for some," says Gadgil. They have also brought in the concept of a 'medical concierge' to help an employee book an appointment, handle bills and so on. 
Chipmaker Intel has balanced the need for rentention with employee needs. It has altered its healthcare options this year, keeping in mind skewed claims ratios, and change in demographic profile. 
The company found that a few employees were making claims, resulting in insurance companies charging a high premium from all employees. It now provides a flexible basket instead of a fixed plan for all. 
An employee can select a premium amount he is comfortable with and opt for a plan in the range of Rs 3 lakh to Rs 7 lakh. The new plans also offer discounts on outpatient coverage in specific hospitals, personal insurance at negotiated rates, free home delivery of certain high value pharmacy items and so on. "At the end of the day, this is a core benefit and we have given choices for employees to see which one makes most sense to them depending on what stage of life they are in. This is a critical element of the employee retention programme that puts us in an employer of choice category," says R Anish, director-HR, Intel South Asia. 
Tesco (HSC) has made additions in its health benefits programme after conducting an employee survey last year. Employees preferred paying premium instalments over a six-month period rather than in one go. 
The change has been introduced this year and a 24/7 insurance helpdesk has been installed now as well. These are expected to attract employees, saysDayanand Allapur, HR head of the IT arm of the global retail chain. 
The company is allowing employees to increase their insurance amount, while it will pay more for parental coverage, as well as towards life insurance for senior employees. 
A technology company whose Indian arm is headquartered in Bangalore has roped in Aon Hewitt to study various medical benefit programmes offered across the industry, which can be adopted by the company. "We have asked the consulting firm to give us more information and may roll out some new medical policies for our employees," says the HR head, who does not wish to be named. An attractive medical package will not override a compensation structure for the younger lot but it often concerns the middle-level and senior employees, says Aon Hewitt's Shankar. 
Companies have also altered their healthcare offerings to develop a feeling of security among existing employees. Philips Innovation realised that making an employee pay a certain amount of premium for a parental insurance of Rs 2 lakh, irrespective of the need for it, was not the best option available. From this year, they have allowed an employee to select insurance for parents between Rs 1 lakh and Rs 5 lakh so that the premium amount differs according to the employee's needs. 
"Unlike in the West, premiums here are still low and firms can pick them up as of now. Also, not many have individual insurance policy portfolios in India and therefore, companies can pick it up on their behalf to provide more security," says Deepak Shetty, HR head. 
Benchmarking these benefits and staying a step ahead of the contemporaries is always on the anvil. Philips Innovation's employees get life insurance, which works out to twice the employee's gross salary. Under accident insurance, those at the director level are covered for as much as Rs 1 crore whereas the competition covers its directors at Rs 50 lakh. "It brings in the safety factor and instills in employees that the company takes care," says the HR head. 
Whatever be the reason, healthcare is no longer a hygiene factor for companies — it is now a conscious retention tool. 
devina.sengupta@timesgroup.com