Emerging Benefits Trends in the New Normal — People Matters
The COVID-19 pandemic has seen organizations embrace workforce wellbeing as a key initiative to weather tough times and thrive in the new normal. This has led to increased employee healthcare costs during the pandemic.
As a result, across Asia, including India, medical cost is projected to increase alongside the potential increase in healthcare utilization and healthcare expenditure in 2022. This can be attributed to COVID-19 treatment. 19 or ongoing medical care, long COVID/post-COVID complications, delayed treatments deteriorating health profiles due to lifestyle illnesses, mental health issues, etc. This would have a significant impact on employers from a cost perspective if not appropriately managed through cost mitigation measures.
According to a recent report by Mercer Marsh Benefits (MMB), insurers expect costs associated with employer-sponsored medical benefit programs in India to rise by 15% in 2022, the largest predicted increase in the Asia region. During the recently concluded renewal season, we have seen group medical insurance premiums increase by 15-18% on average in India.
In addition to the COVID-induced demand for healthcare services, the insurance industry saw record claims during this period due to COVID-related hospitalizations and deaths. The increase in insurance claims has also resulted in higher premiums, stricter underwriting practices or policy exclusions.
Emerging trends in health risks after COVID-19
According to the MMB Health Trends Report 2022, COVID-19 is impacting the claims experience and insurers have identified emotional and mental risk as one of the main factors influencing the cost of the medical plan provided by the employer. Two-thirds of insurers expect to cover COVID-19 care in 2022, which should take into consideration coverage for long COVIDs, deferred treatment, mental health, etc.
Globally, 33% of insurers provide or cover virtual mental health counselling. The trend is similar in India, where mental wellbeing and psychological support are emerging as a key value proposition for employees, as seen in the MMB Health on-demand India 2021 survey, where 60% of employees rate this as “very” or “extremely” valuable. .
Non-communicable diseases or NCDs have also emerged as one of the main concerns of insurers, which mainly include metabolic and cardiovascular risks, as well as cancer and circulatory diseases, which require preventive and self-administered care (mode management of life and conditions).
In India, nearly 5.8 million people die each year from non-communicable diseases (NCDs). The report reveals that cancer (55%), diseases of the circulatory system (43%) and COVID-19 (36%) were the main cost drivers for medical claims in Asia in 2021, while respiratory diseases (47%), gastrointestinal (36%) and COVID-19 (34%) are the medical conditions that have been the subject of the most frequent claims.
Preventive health and digital health
We also see employees adopting preventative health care (health checkups, health risk assessments, vaccinations, etc.) and self-care solutions to mitigate future health risks.
Self-care solutions include wearable technology to manage wellness, home testing kits for common conditions, and app-based devices to help self-manage health issues. Self-care solutions are highly valued by employees, with nearly 60% finding home testing kits and wearable devices to manage conditions such as diabetes and heart disease to be extremely valuable.
Digital health from primary and preventative care is also highly valued by employees and a number of Indian companies have introduced teleconsultation since the start of the pandemic. Globally, too, the trend is similar, with almost 70% of insurers now offering or covering telemedicine services for simple health conditions such as colds, coughs and 61% of insurers providing video, phone or textual for the treatment of important problems such as diabetes.
We believe that flexibility and choice will be key when it comes to benefits and policies going forward. Employee value propositions with integrated, holistic and personalized health and wellness programs that are not limited to physical well-being, but also mental, social and financial well-being are gaining traction with progressive employers .
Employee wellness is increasingly becoming a compelling value proposition post-pandemic, companies are now aware of their needs and are striving to provide employees with a holistic wellness experience to enable them to work effectively. It’s critical that employers provide effective benefits programs and initiatives that align with their life goals. Having a well-organized employee enrichment infrastructure in place will benefit not only employees but also employers to acquire lasting talent.