Medical insurance costs for companies have risen at a faster rate than growth in salaries over the last five years, according to the findings of an employee benefits survey by Marsh India Insurance Brokers.
“Salary costs for employers have risen 7-12 per cent annually, but the medical insurance costs continue to rise at an average rate of around 18 per cent. We expect health insurance premiums to continue to rise in the 15-20 range”, said Sanjay Kedia, CEO, Marsh India.
The survey was conducted among 301 Indian organisations across sectors with a group total size of 1.5 million people.
Interestingly, the survey notes that the average hospital room rent has halved in the last four years. It has come down from Rs 4,000 a day in 2008 to Rs 1,900 in 2012.
“In hospitals, charges for nursing, surgery, operation theatre vary according to the room rent. However, with companies increasingly incorporating co-pay arrangements with employees and restrictions imposed on room rent, which constitute 15-18 per cent of the claims value, the room rents have come down,” said Kedia.
Companies are gradually doing away with medical insurance cover for employees’ dependent parents. According to the survey, 54 per cent of the organisations allow dependent parents to be covered in the policy compared with 65 per cent last year.
“Rising healthcare costs and growing lifestyle risks are driving employers to revisit their employee health and well-being strategy. Companies will increasingly look at voluntary benefits in terms of a defined contribution without adding to a company’s benefits budget,” Kedia said.