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Flipping the benefits pyramid: Addressing the healthcare gap linked to affordability and accessibility in Asia

23/03/2022 · 4 minute read

Our 2022 research on Health Trends shows that, all too often, socioeconomic factors determine whether an employee is entitled to benefits, insurance and health coverage.

This means that disadvantaged groups often miss out — despite needing the most help. In light of these findings, employers must urgently address outdated, inappropriate and inadequate healthcare benefits and implement plans designed to support all of their workers.

Traditionally, employers have provided more comprehensive benefits for higher earners and management. However, this approach alienates lower-earning employees and discriminates against certain groups. This can lead to unfulfilled care expectations and cause staff to become disillusioned and demotivated. The traditional approach can also produce high turnover among under-served groups and even damage the reputation of employers who are seen to fail in this area.

To respond to this challenge, businesses must “flip the pyramid” on how they approach the provision of healthcare benefits. To do this, firms should provide equitable levels of support for employees at every level of their organisation, focusing on previously unmet needs.

Healthcare affordability

The process of positive change must start with addressing affordability. Forward-thinking organisations are becoming more aware of the medical expense burden faced by their lower-wage workers. At Mercer Marsh Benefits (MMB), we are seeing many firms devising strategies to tackle cost issues. These strategies include providing affordable insurance for entry-level and junior employees.

We recently helped a leading consulting firm in Asia optimise the design of its benefit packages so that lower-level employees pay a lesser co-payment than managers and other executives. The levels of these payments were set so that they were affordable for the individuals involved.

In another case, we worked with a real estate and facility management firm to improve the health benefits it provides. Recommendations were made that the firm should only provide access to corporate buffer payments for junior employees, as this would be an effective way to support health equity.

A third case involved working with a food service company. We helped the client design a bespoke benefits program that would minimise out-of-pocket expenses (by accommodating the proportionate deductions linked with room rents). The new program also offered low-wage workers an additional parental insurance benefit.

Confronted with rising medical rates, employers are faced with the dual challenge of predicting and managing the rising costs of health insurance programs, so that they can continue providing affordable care for all employees. Consequently, there are growing demands for insurers to provide a better evaluation of claim trends.

Fortunately, insurers have responded well to this pressure. Our 2022 health trends research found that “data analytics” is the top strategic priority for a third (34%) of insurers, and that the “better management of providers” is the top priority for one in five (21%) insurers.

Employers are leveraging a combination of private and public coverages to meet their employees’ healthcare needs. They are also bracing for the impact of factors such as long COVID and the challenge of deferred care. To get ahead of changing claims activity, they are regularly reviewing the claims that are being made through their medical plans. Overall, they are updating their cost-containment strategies to balance economics with empathy, and to position benefits as an investment rather than an expense.

Technology provides an effective tool to improve healthcare affordability, especially when it comes to the management of chronic conditions through cost-effective virtual and remote care channels. Our research[1] shows that 84% of employees want to use telemedicine, and that half of all employees want to use apps that can help them self-manage conditions and that will allow them to interact online with their doctors via video.

Healthcare accessibility and inclusivity

Although healthcare affordability is certainly an important issue, access to healthcare is equally critical. Fortunately, a paradigm shift in employer behaviour can be seen, with many firms now focused on ensuring that quality healthcare and infrastructure are available to all employees regardless of job, role, or function.

For instance, one multinational beverage corporation is working toward harmonising its benefits to provide equal coverage to their white- and blue-collar workers, irrespective of each individual’s designation or grade. This is being driven by the corporation’s commitment to providing equitable healthcare access.

As with affordability, such changes are being facilitated by improvements in technology, which are enabling self-care and at-home solutions, and improving convenience and access.

Furthermore, forward-looking employers are focusing on accessible and inclusive primary and preventive care, with a particular emphasis on outpatient medical programs, digital health, and health checkup programs. For example, in India, a leading technological corporation offers health checkup cover of INR10k (US$130) for male employees and of INR15k (US$195) for female employees.

Proper and timely access to mental healthcare has also become a priority for many employers, with organisations now moving beyond the usual parameters of their employee assistance programs (EAPs) to address complex issues such as addiction and post-traumatic stress disorders.

As with general health issues, many companies are working to improve access to mental healthcare. For example, according to our recent research on this issue,[2] organisations are evaluating digital platforms as a way to provide cognitive behavioural therapy and virtual counselling options (to complement face-to-face interactions).

Insurers are also working to design more inclusive medical plans. We are pleased to see that many insurers now appear more open to approaches that drive diversity, equity, and inclusion (DEI). For instance, our 2022 health trends research found that:

  • Almost a quarter of insurers (24%) are considering incorporating social support into their programs or have already done so. This includes help with transportation, food, and housing.
  • A third (30%) have made changes to ensure there is diversity among the medical providers within their networks.
  • Over a quarter (27%) have changed eligibility access to make coverage more inclusive of LGBTQ+ employees.

As insurers offer more product options and underwriting flexibility, we are optimistic this will make it easier for employers to make meaningful changes to the healthcare they offer their employees.

Flipping the pyramid to address the healthcare gap

Given our findings, it is clear that employers now have an opportunity to support a diverse, equitable, and inclusive workforce by recognising that employees have different healthcare needs and values and that care must be affordable to all.

In the future, we expect to see companies providing core minimum benefit standards to all, and putting accessibility and affordability at the forefront of their healthcare benefit plans and thinking.

Here are four actions that you can take as an employer
  1. Review your benefit programs to eliminate outdated, inappropriate and inadequate plans.
  2. As part of your ongoing vendor management activities, have conversations about environmental, social and governance issues with your insurers and understand what they are doing in this field.
  3. Determine to what extent your benefits should align to your DEI goals and refine your benefit strategy accordingly.
  4. Continue to advocate for better collection and sharing of data to allow for anonymised and aggregated identification of workforce health trends. This data should include coding for social factors that influence health and well-being. 

For more information, contact your MMB client executive or local office.

1 Mercer Marsh Benefits. Health on demand 2021

2 Mercer Marsh Benefits. Turning Health Risk Into Value: Are You Supporting Mental Health?

Meet the author

Joan Collar

Joan Collar

Asia and Pacific Leader, Mercer Marsh Benefits

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