Stock Health Insurance
HR directors and departments must take the onus of ensuring optimum health insurance packages and options for their staff. Image Credit: Shutterstock

Anyone with a strategic role at their company – or who runs their own business – will probably be looking back at this month and asking where it went. From countless conversations, I know this is the case with HR professionals.

Today’s HR departments are involved in so many aspects of the business, and are a critical link between employees and management, as well as a multiple stakeholder in overall cost management. Perhaps the biggest single concern of HR when it comes to this connection between employees and cost management is group health insurance.

It comes around every year, you know you must renew. The progressive UAE regulation has made it mandatory for the last couple of years. And it’s not an insignificant cost. But how HR directors approach putting in place (or renewing) group health insurance – the structure, the balance of costs, and incentives - are varied.

For some, the UAE office is part of a global mandate, and their ‘hands are tied’. Some are so busy with other things, they will take a glance at new offerings, find little to no difference in the quotations given, and revert to their current provider – either the end insurer or an intermediary ‘broker’.

Alternatively, they may be swayed to change from a quotation that greatly undercut the competition.

Then there are those who truly look to compare offerings and squeeze every cost, ensuring their employees have the best coverage for injuries and illness and the most convenient mix of hospitals in the network. They prioritise prevention and education around health.

There’s no doubt I prefer conversations with the last of those three. The question is, how in 2023 do we keep a lid on costs and maximise those benefits?

Insurance and inflation

Inflation has been the main economic story of 2022, affecting almost everything, from raw materials to wages and tax regimes. While economists such as Harvard’s Jason Furman believe inflation will reduce this year, for corporate health cover, it may not be that simple.

KFF, a non-profit organisation focusing on health issues in the US, found the average annual premiums in 2022 were similar to the previous year. But this was largely a result of policies finalised in the autumn of 2021. In other words, last year’s inflation may have a delayed effect, come renewal time.

Like the US, much of the average person’s health insurance in the UAE comes from their company. We’ve seen price inflation here, too - figures from Badri Consultancy found a 7 per cent increase in UAE insurance premiums in 2021 from the previous year. The key is to apply ideas for year-on year-cost sustainability, and this takes employee-centred ideas.

Tackling cost head on

I challenge and encourage HR teams to approach their insurance as the final scenario I mentioned above. Rather than renew with their current provider by default, believing that the same or higher cost is just the ‘market rate’, return to the point of the exercise, and that’s protecting staff and encouraging their wellbeing.

Scrutinise how that 2022 policy was used – were the hospitals visited even in your network? Could the mix of facilities be adjusted without compromising care? If your company had more sick days in 2022, where are you on the journey of promoting wellness at work?

Company initiatives at no or little extra cost can be as powerful as this-or-that top-rated clinic. I’m in a privileged position at AES to offer ideas to HR directors when securing the best overall terms – and even better, learning of their great ideas. But this only occurs when this business cost centre – touching employees lives daily - gets the attention it deserves.