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Why do companies provide health benefits: An analysis

Bhavish Sharma • Aug 24, 2020 • 4 Min read
WHY DO COMPANIES PROVIDE HEALTH BENEFITS : AN ANALYSIS: Picture Source: pexels.com/
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hy do employers provide health benefits to their employees and their families?The answer to this question lies in the economics of an employee health program!

Globally, companies with effective health programs see upto 34% higher revenue per employee.

Globally, companies with effective health programs see upto 34% higher revenue per employee. They also observe a reduction in the number of leaves taken by employees which indicates higher wellness as well as more employee engagement. Keeping these benefits in mind, more and more Indian companies have started looking at health and wellness programs as a productivity and morale booster, especially in the current scenario.

Contrary to popular notion, providing health benefits such as insurance is not just a cost centre for companies and could even result in a net reduction in cost. When measured against reduced absenteeism, overtime compensation, cost of replacing & training employees, and higher productivity, the benefits of health programs start outweighing the costs.

Besides the long term positive outcomes from a health program, there is a more immediate reason for providing it. A good health package is imperative to attracting & retaining new talent and is increasingly becoming a differentiator in the recruitment process, and provides companies an opportunity during hiring negotiations.

It is a win-win for everyone i.e. the company and the workers, that the company provides health benefits to all its employees.

But why are employees interested in health programs as a potential benefit?A company health package saves employees the time and search costs to a good health program - be it insurance, medical packages or wellness programs.They also get better benefits at lower costs since companies are able to negotiate better terms with insurers as opposed to an individual. This results in higher employee retention as well as higher employee satisfaction. As an employee of a company, you would prefer a job which provides health benefits over one that does not. It is as simple as that. Therefore, it is a win-win for everyone i.e. the company and the workers, that the company provides health benefits to all its employees.

As per Marsh India's 9th annual 'Employee Health and Benefits' survey, of the respondents feel that companies should facilitate health benefits for their employees. It becomes even more imperative for companies to provide health benefits in these testing times where employees face the risk of illness on a daily basis. A health benefit like insurance would go a long way to reassure those uncertain about coming into work and increase their peace of mind.

However, in India, many employers who do wish to provide insurance to their contractual or mid- level employees at an affordable cost are unable to due to a dearth of plans. Clinikk Healthcare aims to address this issue of the “missing middle” in the health sector by providing comprehensive health plans which combine both - regular health needs and health  insurance - in one sacheted plan, the first company in India to do so.

Want to know more about Clinikk plans?

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