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Gulf employee healthcare costs 'higher'

Dubai, October 6, 2013

The cost of providing employee health benefits for companies in the Gulf is higher than for those located in the rest of the EMEA (Europe, Middle East and Africa) region, according to a recent report.

The Mercer Marsh Benefits report revealed in the organisation’s bi-annual EMEA  Health Care Survey which, for the first time, included data from companies operating in the UAE and Saudi Arabia.

The Gulf-based participants reported significantly higher cost, 6 per cent of payroll, than those from either Eastern or Western Europe (3.9 per cent and 3.3 per cent respectively).

“Health insurance benefits are far more comprehensive in the Gulf because of the expatriate demographic,” said Steve Clements, employee health and benefits leader for the Middle East at Mercer.

“The schemes on offer reflect the customary practice of providing generous expatriate-style benefits and allowing employees to receive treatment not only within the country, but also within GCC (Gulf Cooperation Council) countries and even in Europe and the US,” he said.

“The issue is exacerbated by an open access system whereby there is often no gatekeeper to access care or direct patients to the most appropriate care pathways and providers. This can result in very high utilisation of health insurance plans. Overlay this with a rapidly developing capability to provide (expensive) treatments for complex medical conditions and you very quickly have a major cost pressure,” said Clements.

“Medical inflation rates here are also considerably higher than in Europe or the US, meaning that if current trends continue, the cost to businesses of providing employee health insurance could become unsustainable,” he added.

The survey studied responses from more than 500 companies across 16 countries. Its findings aim to provide insight into healthcare and benefits trends across the wider region for health industry decision makers and stakeholders.

One significant finding from the survey was that Gulf employers are increasingly adopting sophisticated approaches to cost management using data analytics to target their strategies and taking a more holistic approach towards disease prevention, early detection and targeted intervention to deliver better returns on investment.

This joined up strategy is being implemented to ensure a healthier, more engaged and more productive workforce, as well as having a direct impact on reducing the cost of health insurance claims, said the report. - TradeArabia News Service




Tags: Gulf | Health | cost | Mercer | Report | EMEA | High | benefit |

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