It’s no secret that health insurance premiums across the globe are rising above levels of general inflation. And this is especially the case in the UAE.
In our 2016 Global Medical Trends Survey, we shared our prediction that gross premiums in the UAE were likely to go up by 15 per cent that year, for the third year in a row.
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In Dubai, the ruling that the mandatory health insurance cover provided by employees must include any pre-existing condition has contributed to rises.
While the constantly evolving market can make it hard to track health insurance inflation, it’s likely to be up considerably from the 9.5 per cent recorded in 2015.
With this in mind, it’s becoming increasingly important to make sure your employees understand how to use the health insurance you provide responsibly, in order to avoid pushing costs up unnecessarily.
How not to deal with rising costs
For many companies, the rising cost of providing health insurance for employees may prove unsustainable, leading some to cut the level of coverage they provide. But this is likely to be a false economy.
Providing competitive benefits is a key driver of employee engagement. According to insurer MetLife, an improved benefits package would entice 53 per cent of people in the UAE who are considering moving to another company to stay put. Cutting back on a crucial benefit such as health insurance is likely to have the opposite effect; demotivating staff and prompting them to look for opportunities elsewhere.
There’s also a risk that the health of the staff will suffer as a result of limiting their healthcare coverage, leading to a drop in productivity.
Another option is to increase the percentage employees have to pay towards any treatment they receive, but this is a potential minefield. If you’re based in Dubai, you can only ask employees to make co-payments to cover up to 20 per cent of the cost of outpatient treatments, 30 per cent of medicines, and 10 per cent subject to a maximum of Dhs500 per visit and Dhs1,000 per year for inpatient treatments. Most importantly, you may face legal action if you deduct a share of the premium for employees’ basic compulsory health coverage from their salaries.
The case for health insurance training
So educating your employees about using their health insurance responsibly is a more positive – if less direct – way to approach cutting healthcare costs. Your premium for next year will be calculated taking into account the claims your employees make this year. So if you can encourage your people to make judicious use of their coverage, this should help to keep the price down. But what’s the best way to do that?
If you don’t already get detailed breakdowns of the health insurance claims made by your staff, I would strongly suggest asking your adviser to supply them on a quarterly basis, depending on your policy size. They may also be able to help you analyse the data to spot any patterns of behaviour that could lead to an increase in next year’s premium. This information will help you to plan tailored training, including practical guidance on how best to use the services available.
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This could be done in the form of regular workshops for small groups of staff, perhaps on a team-by-team basis. In a smaller group, people are more likely to stay engaged and to ask questions, maximising the chances of everyone going away with a full understanding. It would also make sense to include training on how to use the company’s health insurance during the on-boarding process for all new staff.
Some key points to include in health insurance training:
1. Understand the financial impact of your health insurance use: Employees should understand that increased usage leads to rising health premium costs, which impacts on the company’s bottom line and ultimately its competitiveness. While the health of the company has an indirect effect on employees, it’s also worth pointing out that there may also be a direct impact on any co-payments made by staff.
Some of the providers currently operating in the UAE have been investing in technology to improve claims management, specifically to help them crack down on overuse and abuse. Making employees aware of that should encourage them to use their coverage with care and to question their physicians if a certain medical service or treatment is deemed not medically indicated by the insurers.
2. Ask for generic drugs: Advise your staff to ask for the generic version of any medicines they are prescribed. According to the United States Food and Drugs Administration (FDA), generic drugs can work out up to 85 per cent cheaper and are equally effective. This is reflected in the US’s high rate of generic drug prescribing – at least 80 per cent, according to the FDA.
But use of generic drugs is thought to be much lower in the UAE, with pharmaceutical company Ayva Pharma reporting that just 5 per cent of medicines used in some hospitals are generic. This issue was discussed at the 2016 MENA Health Insurance Congress. Experts concluded that a major overhaul was needed to persuade UAE doctors to prescribe more generic drugs, which could lead to estimated savings of 30 per cent, equating to Dhs2.3bn per year.
Asking employees to make a point of requesting generic medicines may help to encourage this trend as well as keep costs down.
3. Don’t use the emergency room as primary care: Make sure employees know only to go to a hospital for emergency treatment in a real emergency.
Not only will this free up emergency services for their correct purpose but a visit to a primary care clinic will be considerably cheaper than a trip to the emergency department.
4. Visit your GP first: In the UAE, people are free to book an appointment directly with a specialist they assume is the most relevant. However this could be a costly mistake if it turns out to be the wrong kind of specialist.
Make sure your employees know that the first port of call should always be a GP. If the GP deems that a visit to a specialist is necessary, they can arrange a referral to a suitable one. In some cases there may be no need to consult a specialist at all, and the GP’s charge will be considerably lower than a specialist’s.
5. Use a virtual doctor service if possible: For some health concerns, it may be that an in-person consultation isn’t needed at all. A growing number of providers in the UAE are now offering virtual consultations with qualified doctors, either by phone or online with video.
Your insurance adviser may be able to help you get set up with a reliable service, so you can offer your staff the option of virtual consultations, either from the office or from home.
6. Ask whether tests are necessary: In a survey carried out by the UAE Ministry of Interior publication, 999 magazine, around 28 per cent of respondents said they believed doctors had submitted them for diagnostic tests they didn’t need, purely to boost revenue.
Of course we all like to believe doctors have our best interests at heart, but bearing this in mind, it may be worth advising employees to politely ask whether all the tests doctors recommend for them are actually necessary.
7. Make use of wellness training: Alongside sessions focused specifically on responsible use of health insurance, it makes sense to provide training aimed at helping your employees develop healthier lifestyles. This two-pronged approach is likely to have a more significant effect on reducing your premiums.
If your analysis of previous claims reveals a prevalence of certain lifestyle-related health conditions, such as type 2 diabetes or cardiovascular disease, you might consider organising targeted health-awareness sessions or other interactive programmes.
There’s a lot of truth in the old adage ‘prevention is better than cure’.
So providing wellness training would be a worthwhile investment. In the long run, it should help to improve the wellbeing of your workforce, reducing sick days, improving productivity at work – and ultimately lowering health insurance claims.
By Stephen MacLaren
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