What Are The Benefits Of An Employer-Provided Health Insurance Policy?
An Employer health insurance policy is beneficial for both employers and employees. These are necessary for employees as they cover hospital-related expenses in case of emergencies and come with a low-cost premium. Since the onset of COVID-19, the Indian Government has made it compulsory for companies to provide health plans for employees.
However, is an employer provided health policy sufficient enough for your healthcare needs? Let’s dig a little deeper.
Features and Benefits of Employer Health Insurance Policies in India
The employer-provided health insurance can be private or government. If it is private, these are generally group health insurance policies. However, if it is a government-offered policy, the employee must be registered under the ESI Act.
Different employee health insurance plans in India offer diverse features and benefits. Given are some of the significant features and benefits of these policies.
- Cashless Claim Benefits: Most group insurances or employer-provided health insurances offer cashless claim benefits to employees. This means that when an employee is hospitalised, he or she will not have to pay anything out of his/her pocket for the treatment. Instead, the insurer will pay the treatment costs directly to the hospital.
If an employee wants to avail cashless claim benefits, he or she should get themselves admitted to a network hospital. Policyholders also need to notify the insurance company as well as the employer providing the health insurance plan.
- No research necessary: Employees do not have to spend any time searching for the right health insurance policy for their needs. This saves their time and effort as they are already provided with a comprehensive insurance plan which fits their needs.
- Access to chronic disease treatments: Generally, the cheapest individual plans do not offer coverage for diseases like mental health disorders or chronic body pain. However, employer-provided health insurance provides access to chiropractic services, mental disorder treatment, etc.
- Attracts better talent: An Employer-provided health insurance policy boosts the employee’s morale. It offers an additional perk for fresh recruits. As a result, better talent will want to compete for a role in the employer’s company.
- Lower insurance cost: Employer health insurance plans are generally in the form of group insurance policies. The more people enrol in a policy, the more its risks will spread. As a result, the insurance company can offer premiums at a lower price.
- Tax-deductible premiums: Employer-provided health insurance policies are tax deductible. Hence, company owners can reduce their tax bills every year.
- Improved Morale: When the employer provides health insurance to their employees, their confidence in the company increases, increasing morale and productivity.
List of Treatments Covered by Employer Health Insurance Policy
Here is a list of common diseases for which treatments are covered by most employer-provided health insurance policies:
- Heart Diseases
- Cancer
- High Blood Pressure
- Diabetes
- COVID-19
- HIV AIDS
Additionally, some employer health insurance policies provide treatment coverage for critical illnesses like Parkinson’s disease, paralysis, etc. Some policies cover injuries caused at a workplace which lead to temporary or permanent disabilities.
Why Should You Buy Employers Health Insurance Policy?
Besides Government mandate, the following are some of the reasons why employers may want to buy a health insurance policy:
- It boosts employee retention: Employees value jobs greatly which gives them security and a sense of satisfaction. Moreover, skilled and experienced job seekers rate companies that provide group insurance highly and show interest in working there.
- Protecting them from severe ailments: Employers can safeguard their employees’ health and encourage them to get their ailments treated at the earliest.
- Increase their motivation: Happier and more motivated employees are often more productive. In turn, they are essential for making a company and its venture successful. In other words, providing essential benefits like health insurance to employees can result in more productivity and boost employee morale.
- Tax benefits: Employers can get tax exemptions on the premium they pay for employees’ health insurance policies.
How Would Employees Benefit from Getting Employer Health Insurance Policies?
Here are some of the top benefits you can get from employer-provided insurance:
- Low-cost premium: Employees do not have to pay a high premium to get the benefits of these insurance policies as the employer pays a part or all of the premium. This makes it one of the most affordable insurance policies for employees.
- Coverage for pre-existing disease: Unlike individual health insurance plans, employer-provided policies cover pre-existing diseases from the get-go.
- Extensive coverage: Employer health insurance policies typically cover everything from hospital bills, pre and post hospitalisation costs, homecare treatment, ambulance charges and more.
- Maternity coverage: Employer health plans also offer maternity benefits with coverage for C-sections and normal deliveries.
- Coverage for Covid-19: All employer-provided health plans cover hospital-related expenses for Covid-19. This provides a financial cushion against burgeoning COVID-19 treatment costs.
Coverage Under An Employer Health Insurance Policy
Depending on the insurance company and specific policy, employer policies will usually cover the following:
- Pre-existing diseases: These are covered from the first day of paying the insurance premium with no waiting period.
- Critical illnesses: With these insurance policies, one does not have to worry about expensive treatments for critical illnesses.
- Accidental coverage: It covers employees and family members for all pre and post hospitalisation charges, ambulance fees, room rent etc., in case of accidents.
- Covid-19: The employer will cover the employees and family members if they test positive for Covid-19.
- Hospital bills: These plans help cover expensive hospital bills covering doctor’s fees, nursing charges, specialist fees, medicines, operation theatre charges, diagnostic tests, etc.
- Maternity benefits: Young working professionals do not have to worry about child delivery expenses as these policies cover all sorts of maternity benefits.
- Other benefits: Depending on the policy, an employer’s health insurance policy can cover daycare procedures, home treatment, vector-borne diseases, etc.
What Expenses Aren’t Covered Under the Employer Health Insurance Policy?
- Pre and post-natal expenses: Group insurance policies do not cover pre-natal and post-natal medical expenses unless it leads to admission to a hospital.
- Limited validity: Employer health insurance plans are valid as long an employee stays at the company. When one leaves it, the cover ceases, and they have to restart a new policy.
- Some diseases not covered: Sexually transmitted diseases like AIDS are usually not covered.
- Unproven treatments: These policies do not cover treatments that lack extensive scientific proof and non-allopathic treatments.
- Other exclusions: Insurers do not pay for complications from drug or alcohol abuse. They also do not pay for getting hospitalised without a doctor’s approval.
Also Read: Features & Benefits Of Different Types Of Health Insurance Policies
Should You Sign-up for A Comprehensive Health Insurance Policy Separately?
Though group health insurance policy comes with its share of benefits, it has a few drawbacks. Let’s understand them.
- Low cover: Corporate policies may cover 50%-60% of your healthcare cost. This is due to the low cover such policies offer.
- Depends on your employment status: Such policies are considered null and void if you resign from your organisation. So, in case you decide to leave your organisation, you won’t be able to enjoy the benefits of such policies.
- No tax benefits: You cannot claim tax deductions for group insurance policies.
Other than these pitfalls, group insurance policies usually have a cap on the number of dependants. For instance, some policies may allow you to add your spouse and children but not your parents as dependants.
Considering all these factors, it’s best that you sign-up for a comprehensive health insurance policy separately. You can extend the coverage to your dependents, stay protected against multiple health-related conditions, and simultaneously enjoy tax benefits under Section 80D.
How Can You Claim the Employer Health Insurance Policy?
For Cashless Claims
With this facility, one can get admitted to a network hospital and have the insurer deal directly with the hospital.
To make a cashless medical claim, one will need to follow these steps:
- Make sure you go to a network hospital of your insurer.
- Carry original KYC documents, pharmacy bills, doctor’s prescriptions, policy documents, signed claim forms, and other essential papers.
- Fill up the pre-authorisation form before admission.
- Once your insurer receives all information and documents, they will approve the cashless claim.
Also Read: Cashless Health Insurance – Definition, Process & Benefits
For Reimbursement
You can also pay the medical expenses out of your own pocket and request reimbursement later. One should use this facility with hospitals that are a part of the insurance company’s network.
To file for claims, follow the given steps:
- First, fill up the reimbursement form and submit it to your insurer within a month from discharge.
- Next, submit all medical bills and remember to have them attested and signed by the hospital.
- You will also need to submit the hospital’s discharge bill to the insurer.
- Make sure to read the terms and conditions to ensure you make no mistakes.
Documents Needed to Claim for Employer Health Insurance
The following are some of the original documents you will need to carry to raise claims:
- Claim form signed by concerned doctor and hospital
- KYC documents (Aadhaar card, PAN card, etc.)
- Police report (for accidents)
- Original policy documents
- Ambulance receipt
- Doctor’s prescription
- Medical reports
- Cash memos and bills
- Discharge summary
- Final investigation report
- Diagnostic reports, case summary, hospital bills, medical bills, etc.
Final Word
Salaried individuals can choose an employer health insurance policy to get basic and essential financial cover for medical emergencies. However, if you can afford it, choosing an individual health insurance policy would be an ideal solution as it usually provides more coverage.
For instance, with the Navi app you can get financial cover ranging from Rs. 2 lakh to Rs. 1 crore. Navi offers a Claim Settlement Ratio of 97% for cashless claims, and a network of 10,000+ cashless hospitals across 400+ locations.
FAQs on Employer Health Insurance Policy
Ans: An employer can choose Employee State Insurance (ESI) available from the ESIC or a separate Group Medical Cover (GMC) from an insurance company for his/her employees.
Ans: Yes, one can add family members to their employer-provided health insurance plans.
Ans: Yes, the Ministry of Home Affairs (MHA) made it mandatory for all offices and workplaces to provide medical insurance for workers as per an order dated April 15 2021.
Ans: For companies to resume functioning as before the COVID-19 pandemic, they have to stick to certain rules. The Government of India has made it mandatory for all employers to provide health insurance and COVID-19 coverage to their entire workforce.
Thus, every company needs to offer health insurance plans for their employees in accordance with IRDA’s Order No. 40-3/2020-DM-I (A).
Ans: In the case of a co-pay clause in an employer’s health insurance policy, the employee must pay a percentage of the mediclaim out of his/her own pocket. Typically, co-pay ranges from 10%-20% for most employer-provided health plans.
Ans: Yes, most group insurance policies provided by employers cover many diseases. This includes diseases like:
– Critical illnesses such as cancer, Parkinson’s disease, paralysis, etc.
– Heart diseases, including cardiomyopathy, heart failure, etc.
– High blood pressure
– HIV AIDS
– COVID-19
Ans: A critical illness insurance policy offers more leverage and flexibility to an individual regarding the sum insured and the duration of the policy. As the costs of treating critical illnesses are very high, many experts suggest having separate critical health insurance plans for additional coverage.
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Disclaimer: This article has been prepared on the basis of internal data, publicly available information and other sources believed to be reliable. The information contained in this article is for general purposes only and not a complete disclosure of every material fact. It should not be construed as investment advice to any party. The article does not warrant the completeness or accuracy of the information, and disclaims all liabilities, losses and damages arising out of the use of this information. Readers shall be fully liable/responsible for any decision taken on the basis of this article.
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