Managing medical risks and care for employees

And you’ve undoubtedly been hearing about the rising cost of medical, and medical trend outpacing general inflation, for a long time now. This is still true today. All over the world employers are faced with the challenge of providing this extremely desired benefit that is critical for caring for the health of their people, while costs continue to soar.

While it might differ region to region, this is undoubtedly a global problem. According to Aon medical trend in 2021 was 7.2% – significantly higher than general inflation.[2]

With the marked rise in general inflation in 2022, coupled with the supply chain crisis, rise in oil and energy prices and the distressing situation in Eastern Europe, medical trend could jump even higher once again.

While increasing healthcare costs may seem like an unconquerable challenge for multinationals, there’s actually a lot that employers can do to provide better and more effective health services to their employees without it costing more and more each year. And captives could be the key… but more on that in a minute.

The power of analysing medical claims data

It’s incredibly difficult to know what the biggest health problems facing an employee population are with any accuracy. Differences in claims systems, coding practices, legacy systems and language differences all contribute to non-standardised data, making it difficult to make a proper comparison across a variety of markets. Plus, every employee population faces different healthcare concerns. For example, in one country diabetes might be the biggest health problem, in another it could be musculoskeletal conditions, heart disease or respiratory system issues.

At MAXIS GBN, we collect anonymised medical claims data from over 40 local insurers in more than 25 markets across the world. We then standardise and analyse the data to create a country benchmark, giving us a picture of the private medical landscape based on the experience of our multinational clients.

By analysing the data, we can draw conclusions about the biggest healthcare problems facing employee populations and help multinational employers plan proactive changes to improve employee health and stay ahead of the curve.

Making proactive changes with a captive

But what changes can a multinational make to address rising medical costs? Well, this is, quite literally, the million-dollar question. Because every employer’s population is different, there’s nothing more valuable for a multinational than to see their own data.

Having that oversight of their own unique claims data means that a multinational can make changes to plan design and implement the wellness programmes that could have the biggest impact. Let me give you a few examples.

• If a multinational had a high number of claims for caesarean sections (C-sections) in Latin America, they could consider making a change to their plan where they increase employee contributions (via a deductible or co-payment) for elective C-sections that aren’t medical emergencies or medically necessary. They could also consider implementing maternity education programmes for expectant parents to highlight the pros and cons of both natural delivery and C-sections.
• If cancer is the largest cost driver in countries in the Asia Pacific region, a multinational could offer cancer screening as part of a private medical plan to catch costly conditions before they become even more expensive.

These are just a couple of examples of proactive measures that could be put in place. And while these are based on the data we analysed in our new private medical landscape report, the best way to know the best measures to put in place for a multinational’s own population is to work with a provider that can help them analyse their cost drivers.

Global employee benefits programmes help employers to collate this data centrally and, of course, captive programmes allow the best opportunities for changes in plan design. As the ultimate risk bearer, multinationals with a captive have the opportunity to adapt and amend programmes to meet their needs.

While adding medical to a captive might be a journey for many multinationals, if it means being able to tackle medical cost drivers in the most efficient way and keep employees happy healthy and engaged, it might just be a road worth taking.