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QUESTIONS ABOUT MEDICAL PROGRAMS

You may post any question about employee medical programs by using the comment tab below. If you want it confidential, then e-mail your question directly to actuary@actuarialex.com with your name, position, company, company address and telephone number for verification.


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  • Posted
  • 12/15/2009
1/4/2010 5:51:56 AM
Name Compben Analyst 
Email Address compben(at)yahoo(dot)com 
Location Makati City 
Country Philippines 
Personal Website  
Comments We would like to set up a medical program for our employees but we have limited budget. What is the best program for us? 


1/4/2010 7:10:58 AM
Name Actuary 
Email Address actuary(at)actuarialex(dot)com 
Location  
Country Philippines 
Personal Website  
Comments Hi Compben Analyst,

It is best that you secure first proposals from HMOs (for HMO programs) and life insurance companies (for reimbursement-type hospitalization / hospital income programs) so you'll get to know more or less the cost of each type of program.

Reimbursement-type programs are very flexible and that means you can practically have a plan design that will fit your budget.

Should you really llike to have a comprehensive program like an HMO program or reimbursement-type program with major medical / dread disease benefits, consider making it contributory which means premiums are to be shared by the employee and the employer. In other words, employee gets to enjoy the benefit if he enrols in the program and shoulder the cost of say 50% of the premium.

HMOs usually require a minimum number of participants in a contributory program while life insurance companies require an additional minimum percentage of participation (usually 75% of total eligible employees). For a contributory program to become succesful, the employer share should be substantial, say, 50%.

It is best that you conduct a survey from among employees to determine the least possible subsidy that would entice employees to participate.


 


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