The following is an opinion article written by global insurance advisor Pacific Prime.
Offering attractive benefits packages to employees, such as one that includes an international private medical insurance (IPMI) plan, is a key strategy adopted by an increasing number of businesses in attracting and retaining top talent. It can be tricky however to implement health insurance benefits, as plans that have been secured last year may not be as effective now or in the future.
In order to secure a plan that best suits the needs of employees and the overall business, it’s essential to keep up-to-date on the latest major trends influencing the health insurance industry. This article by global insurance advisor Pacific Prime identifies the latest IPMI trends with unique insights gathered from six industry veterans:
- Robert Lang, Managing Director at Bupa Global
- Kevin Melton, Sales & Marketing Director at AXA International Health Business
- Steve Conway, Regional General Manager at Allianz Worldwide Care (Asia)
- Mike Che, Associate Director & Business Development at Cigna Worldwide
- Kapil Dhir, Chief Compliance Officer at Aetna International
- Steve Clement, Lead Benefit Consultant & Human Resources at Aetna International
For a more detailed analysis on the following trends, you can download Pacific Prime’s FREE report here
Implementing cost containment measures
To ensure that the plan is successful and efficient, all insurers agreed on the necessity of cost containment measures, the most prevalent strategies being a request for proposal (RFP) process and better management of health care providers.
Beginning with an RFP process
The RFP process works on defining business needs, and often times involves working alongside a broker to more effectively identify these specific needs and better keep costs under control, as well as to better review proposals submitted by insurance providers. Bupa Global’s Robert Lang explained that he “can’t emphasize enough the importance for a quality RFP process and engagement with insurers”.
A sound RFP can offer the following benefits:
Better management of healthcare providers
- Clarification for all parties: Needs are clarified by the business, so prospective insurers know exactly the type of plan needed.
- It sets expectations: All parties know what to expect once the plan is implemented.
- Risks are identified: During the RFP process, any potential plan risks (e.g. claim concerns) are identified before a plan is secured.
- Premium and coverage sensitivities are addressed: A commonly mistaken presumption is that all plans are the same and thus the one charging the lowest premium is often chosen. Instead, the RFP process can help find the most suitable plan by addressing the most important coverage elements.
For a more cost-efficient plan, AXA’s Kevin Melton commented that “treatment provider network management is crucial to negotiating the best prices for treatment at the same time as ensuring quality for customers.”
There’s a trend towards insurers more selectively managing the choice of preferred healthcare providers, choosing providers who offer the right balance of good quality care combined with reasonable costs.
Management of benefits
Health insurance benefits are increasingly put into the spotlight by HR and plan administrators. These include refining benefits and a transitioning focus towards more value-added services.
Refining coverage elements
Insights gathered from the six industry veterans all indicate a trend towards refining coverage elements. In the case of maternity insurance, this benefit tends to be more costly, yet it is a highly demanded perk. To contain costs, Cigna’s Mike Che explained that “some companies are scaling back maternity a little bit rather than increasing benefit limits. We are also seeing many companies decrease the benefit, putting a cap on it.”
There’s also a noticeable increase in demand for wellness benefits, such as the introduction of preventative health programmes, thus marking a shift towards more value-added services as opposed to traditional health insurance benefits.
Focusing on value-added services
There’s a growing trend towards HR and plan administrators looking to offer more value-added services when it comes to health insurance, and a number of insurers have responded to this demand by offering a broader range of services. Allianz’s Steve Conway explained that “having a range of Corporate Assistance Services gives [their] corporate clients a lot of additional tools to support their employees”. Further services include intervention services that proactively help customers with health advice so that they can lead healthier lifestyles in the long-term.
To ensure that the company health insurance plan is successful, there’s a growing trend towards integrating technology with insurance, the most important and requested technical elements being:
- Portals: There’s an increase in demand for more customized portals that provide a plan’s details, member management, forms, etc.
- Mobile apps: Aetna’s Kapil Dhir stated that “The power of the smartphone offers efficiencies benefiting clients and their staff...A good healthcare plan will help with retention and morale - having ‘health care in your pocket’ will magnify those benefits.” As we continue to see mobile apps seamlessly integrating with health insurance, we will see an increasing trend towards useful functionalities such as ‘find an in-network provider near you’.
Working with regulation
- Claims and plan data: Data management holds numerous positive implications on cost management, such as the more effective prediction of claims habits, which can lead to a more cost-efficient underwriting process.
As explained by Aetna’s Kapil Dhir, “compliance is already a hot topic, and we expect to see more clients paying attention to it”. There’s an increasing trend towards good governance. Especially as international health insurance continues to increase its prevalence alongside regional or local cover, HR and plan administrators will need to be aware of each region’s regulations when implementing international plans, as having compliant plans will help reduce long-term management costs while keeping employees legally and adequately covered.
To best introduce and maintain cost-effective employee health insurance plans that meet the coverage needs required by employees, Pacific Prime predicts that there will be a growing demand from employers to consult the services of trusted insurance brokers in order to ensure that they secure the most sustainable insurance solutions.
The preceding article was written by Pacific Prime, a global insurance broker. The views expressed within do not necessarily reflect those of Insurance Business.
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