There is no doubt that offering business medical insurance to your employees will add value that money simply cannot buy. Not only will you be providing your staff with peace of mind, knowing they will always be well cared for if they unfortunately become ill, but your company will also benefit from the additional cost-saving resulting from increased staff retention, a fit and healthy workforce and a better quality of applicant when recruiting – simply because of the benefits package you offer along with the proposed salary.
If you are looking for a way to tailor your healthcare package and lower the cost to your company, you may find a healthcare trust is a viable, economical alternative to traditional corporate medical insurance policies. Not only is a trust an efficient, modern solution to group healthcare, it is arranged in such a way as to provide minimal administrative burden to your company.
What is a Corporate healthcare trust?
A corporate healthcare trust works in a similar way to business health insurance plans; employees benefit from similar types of cover they would normally receive from one of our standard corporate health insurance policies. However, a healthcare trust allows you finer control over the exact terms and conditions of your insurance (for example, the type of cover you wish to provide and the extent of the provision) because the funding arrangements are completely internal.
Healthcare trusts can be funded by you for your employees, or opened up to the relatives of your staff who would be covered by additional top-up payments from your staff member’s salary. The latter is known as a ‘multi contribution’ healthcare trust, and works in a similar way to group medical insurance.
When properly arranged, a corporate healthcare trust is set up in conjunction with healthcare experts who can provide suggested template options which you can then customise to your needs.
What are the benefits of a Corporate healthcare trust?
There are several benefits of running your own corporate healthcare trust, beyond the finer control we have already mentioned.
As a trust is not a type of insurance, certain insurance taxes are not applicable, which could make your healthcare plan cheaper to provide.
- Because your healthcare plan is specific to your organisation, you get to choose the benefits that you feel will bring maximum benefit to your employees.
- The types of treatment you choose to offer, or the financial limits to those treatments, can be very specifically defined, depending on the type of environment your personnel occupy and the kind of work they do.
What is a private medical administrator?
Although your trustees maintain control of the funds in your healthcare trust, a private medical administrator – usually a company who are experts in the healthcare industry – will handle the day-to-day management of claims and payments, meaning no extra burden on your existing workforce. Private medical administrators can advise you on how to use the money in the fund efficiently, especially where there are long-term illnesses or large claims on the horizon.
Private medical administrators also use the funds to pay the healthcare provider directly, so you don’t need to worry about actually turning the paperwork around and keeping on top of the claims.
Which option is right for my business?
We generally recommend healthcare trusts for medium or large businesses and corporations because a large trust fund is required to provide adequate cover. That’s not to say that healthcare trust plans can’t be tailored to suit small businesses and organisations; many small businesses choose to tailor their plan in a very specific way to suit their budget (for example, they may set a cost ‘ceiling’ on certain treatments).
A healthcare trust may also suit your business philosophy more than a business medical insurance plan. This type of trust scheme is likely to appeal to modern companies who enjoy a co-operative vision or culture and wish to offer a friendly, self-sustaining healthcare option.
There can be costs involved in setting up the plan depending on how much you customise your cover options. However, the time and money you spend fine-tuning your policy will be recouped if you plan carefully and correctly. Remember: healthcare trusts are likely to be your most tax efficient healthcare option. Why not speak to us today and see if a healthcare trust is right for your organisation.
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