Moving from blindly buying PMI to defining a healthcare strategy will stabilise company health plans. Rachel Riley explains.
Traditional PMI was once a perk that changed to a benefit and is now arguably a luxury.
There surely cannot be a company or employee benefit consultant who doesn't want to reduce their healthcare costs without giving away any benefits.
But continually stripping and sanding down an old, warped door before painting it with a shiny new coat does nothing to disguise the fact that it is out-dated, worn out and not fit for purpose.
Now is the time for forward-thinking companies to progress beyond the insanity that is tweaking excesses or touting their business around the market in the hope of a lower, sometimes lower than is realistic, price.
And this is insanity because they are doing the same thing time and time again in the hope of a different result.
Companies need to undertake a comprehensive review of their healthcare strategy, not their benefits.
Returning to the previous analogy, take the door away, use it for firewood and start from scratch.
THREE STEPS TO SUCCESS
The first step is to ask yourself: "Do I provide PMI at all? Would cash do as an alternative?" As a private medical insurer, this is admittedly an odd suggestion. But there is no point shying away from difficult questions.
There is little point in shoehorning an insurance policy in where it does not fit. If PMI is no longer a tenable and sustainable benefit, would it be better to offer employees a cash alternative instead, for them to do with as they will? Or through a flexible benefits system, do you give them the chance to purchase a healthcare option they will value?
The next step is to ask: "Is it fit for purpose?" Assuming most companies will, for a whole host of reasons, opt to retain their PMI scheme, then can the money they are spending be used in a more intelligent way? Is it really sensible to keep chipping away at the egalitarian, one-size-fits-all, fully comprehensive PMI scheme to keep costs within budget?
