Health benefit schemes

Health benefit schemes are an increasingly important aspect of employee benefit packages. The type of scheme varies from offering private medical insurance (PMI) to employees and, in some cases, their partners, to more flexible structures where employees can choose to opt-in or out of PMI.

Such flexibility is not always clear-cut: some suppliers of PMI are reluctant to provide insurance when employees are allowed to opt- out, as they believe employees who choose to remain within the scheme are those who are most likely to make claims. However, as many PMI schemes also provide cover for partners, opt-outs are an attractive option for many employees where the household already has access to health insurance.

One option is to take a pre-PMI approach based on prevention rather than cure. This benefits the employer by providing faster treatment, enabling the employee to return to work earlier. Preventative measures could include stopping smoking or joining a gym. This approach could reduce the risk of absence through sickness ‘at source’. Research has indicated that the costs of prevention are 5% of the costs of sickness.

As part of a wider health benefits package, employers may choose to provide cash incentives to encourage employees to live healthier lifestyles. Workshops and presentations on healthier living can be linked to national health awareness days. Employee assistance programmes are also popular and can range from providing legal and financial assistance to face-to-face counselling. Inevitably, budgets for healthcare are under scrutiny but there are measures that cost very little money.

Research by Investors in People in 2014 found that more than half of employees surveyed said health and wellbeing benefits offered by employers improved their overall job satisfaction. Its research, which surveyed 3,009 full-time employees, found that the opportunity to work flexible hours (43%) was the top health and wellbeing benefit which makes, or would make, respondents feel most satisfied in their role. This was followed by health insurance (41%) and dental insurance (23%). But more than half (54%) of respondents felt their employer did not care about their health and wellbeing, as long as they get the job done; 48% of this group said it left them feeling less motivated, with a third stating they had considered looking for a new job as a result. Eight out of ten said they would feel more positive towards employers if they were offered better health and wellbeing benefits.

Health screening must be offered to all employees if it is to be tax exempt. If only offered to senior employees, then it is a taxable benefit and can also breach the Equality Act. Although screening should be offered to all, there is no requirement to ensure it is taken up.