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Corporate Health Insurance

Name: Corporate Health Insurance
Creator: Savvy
Published: 2023-03-29T16:54:41+10:30

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Written by , updated on July 6th, 2023

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There’s a long and proud history of Australian companies providing health cover to assist their employees with the cost of health care treatment. In fact, many of the not-for-profit health funds which exist today started life as corporate health insurance funds.

However, there are now many health funds in Australia which offer corporate health policies to companies looking for cover for their employees. You can find out more about this type of insurance and the benefits of offering health cover to your employees through Savvy. Get connected to a corporate health insurance expert through us today.

What is a corporate health insurance policy?

A corporate policy is a type of health insurance offered by an employer to its employees. It's a type of group health insurance offered where the insurer has a fair idea of the average age of the group and the appropriate risk profile which applies to that demographic.

They’re either partly or wholly funded for the benefit of the employees. The cover offered may be very similar to that offered by major health funds on the retail market, or it may be more customised to the needs of the corporation and its members. They can also come with a further incentive to the policy-holding company, such as a discount.

Corporate health insurance is offered by some of Australia’s largest insurers to small, medium and large companies wishing to offer a benefit to their own employees under a group arrangement. You can enquire about corporate health insurance through Savvy to find out how your company could benefit from a plan.

What are the differences between employer-funded and employee-funded health insurance?

Corporate health insurance cover can be organised in different ways, depending on whether the company wholly or partially assists with the cost of the private health insurance provided to their employees. Different funding models include:

Employer-funded

This is where the company pays either the partial or full cost of health insurance for its employees. It’s offered as a benefit of employment as a means to increase employee retention and overall wellbeing. Such an arrangement usually requires most or all staff members to join the health fund offered by the company to enable a corporate discount to be applied to its cost. The employer will incur a fringe benefits tax liability for the provision of this health cover, so a tax professional should be consulted before such an arrangement is put in place.

Employee-funded

In such an arrangement, the company negotiates access to a health plan on behalf of a group of employees, which can include a corporate discount or other incentive if there are sufficient participants to justify an incentive being offered. Inclusion in the plan is usually voluntary, which is why a sufficient number of participants needs to combine to gain a corporate arrangement. The company may not contribute towards the cost of the health insurance but employees may get a better deal by joining their company health plan, rather than buying insurance individually.

What are the benefits of a corporate health insurance plan?

Corporate health insurance plans can provide numerous benefits to companies and their employees. Some of these may include:

Potential benefits of corporate health insurance – for the employer

Provision of private health insurance to employees who may otherwise not have health cover, resulting in more choice about when and where treatment is provided. This can result in reduced staff absenteeism due to inconveniently-timed medical appointments
May increase employee loyalty, satisfaction and retention rates
The possibility to attract and retain overseas skilled workers or specialists to fill skills shortages in Australia

Potential benefits of corporate health insurance – for the employee

Membership of a corporate health insurance plan will count towards Lifetime Health Cover, possibly avoiding the Medicare Levy Surcharge
Can provide private health insurance extras benefits that are local and relevant
Can possibly be cheaper than individual private health insurance hospital cover with corporate discounts (although this isn’t always the case)
The possibility of convenient access to additional health and wellbeing services such as subsidised weight loss support, quit smoking programs and mental health support programs
The possibility of reduced time spent organising and claiming back benefits for private health cover

How can I arrange a corporate health insurance policy for my company?

You can get in touch with a corporate health insurance specialist who can assist you with exploring all the options available for your company through Savvy. Customised health plans to suit individual companies can also be arranged so your employees gain the maximum benefit from your corporate health insurance policy.

Enquire about corporate health insurance through us today and you can connect with a specialist to help you with your policy needs.

Types of health insurance

Hospital cover

This can help you pay for medical treatment if you need to be admitted to hospital. It can help cover the cost of your admission or accommodation and the fees charged by doctors, surgeons and anaesthetists. It can also cover other costs associated with a stay in a private hospital.

Extras cover

This helps cover the costs of health care treatments outside a hospital setting which aren’t covered by Medicare. This can include major and minor dental treatment, orthodontics, hearing aids, physiotherapy, glasses, contact lenses and podiatry (in most cases with annual limits).

Cover for singles

This is a standard health insurance policy designed for a single person, rather than being tailored to cater to the needs of a couple or family. It may include hospital cover plus extras, or either of these types of insurance on their own, depending on what you're after for your health cover.

Cover for families

A family health insurance policy is designed for a family unit including dependent children who may reach up to 31 years of age with some insurers. It offers private health insurance suitable for the whole family and may include shared limits for all members included in your policy.

Cover for seniors

A health insurance policy aimed at seniors is designed to appeal to people who are in the second half of their life. These are often specific Silver Plus policies that offer the same cover as other health insurance policies, with the exception that pregnancy and childbirth cover may not be included.

OVHC

Visitors who are in Australia on a temporary basis for travel, work or study may be able to take out Overseas Visitors Health Cover (OVHC). Many visas issued in Australia come with a requirement to take out this type of insurance, which covers visitors who may not be covered by Medicare.

Ambulance cover

Ambulance cover is generally available either packaged into your private health insurance or on its own as a separate policy or subscription. By having this protection, you could be covered for all eligible ambulance travel in Australia (subject to your insurer's terms and conditions).

Basic hospital cover

The cheapest and most barebones form of private hospital insurance, this can include cover for rehab, in-hospital psychiatric services and palliative care. Having this policy will enable you to avoid paying the Medicare Levy Surcharge (MLS) and Lifetime Health Cover (LHC) loading.

Bronze hospital cover

Bronze hospital cover is a step up from basic insurance, including 18 further clinical categories such as ear, nose and throat, bone, joint and muscle, digestive system, joint reconstructions, gynaecology and chemotherapy, radiotherapy and immunotherapy for cancer.

Silver hospital cover

Silver hospital cover is the second-most expensive type of policy and offers the second-most clinical categories. On top of what's offered by basic and bronze cover, it also includes heart and vascular system, lung and chest, blood, hearing device implantation and dental surgery.

Gold hospital cover

The highest level of private hospital insurance available in Australia, gold policies can offer cover for pregnancy and birth, weight loss surgery, assisted reproductive services and insulin pumps on top of all the categories provided by silver, bronze and basic hospital insurance.

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Frequently asked questions about corporate health policies

What factors should an employer take into account when considering corporate health insurance?

Questions to ask when considering corporate health plans include:

Can my company afford to provide subsidised health care to employees?
Will a corporate health plan assist with talent acquisition and retention?
If a voluntary health plan is negotiated, are there sufficient employees who may be willing to join the scheme to provide critical mass and therefore attract a corporate discount?

Even if you’re a smaller company, it’s still worth discussing your options with a health insurance expert (which you can do through Savvy) to help determine what the most suitable deal for your business may be.

What happens to corporate health insurance cover when an employee leaves the company?

Usually, the employee would lose access to the corporate benefit of health cover. Health cover would be terminated for that one employee on an agreed date and any premiums paid in advance by or for the employee can be refunded for the unused portion of cover. The employee is then free to arrange their own private health insurance through a retail provider. Your corporate adviser can assist these employees. If your business’ number of covered employees falls below the amount required to maintain your discount or another incentive, you would lose access to them as part of your policy.

Can corporate health policies cover employees’ family members too?

This entirely depends on the arrangement the corporation comes to with its employees, and the health fund they insure through. Some companies may offer subsidised cover to their employees for singles cover, as well as couples or family cover, while others may offer the option of the employee paying the difference in price if they want a couples or family policy.

Do age-based discounts still apply if employees choose corporate health cover?

This will depend on the health fund the company uses for its insurance, and the arrangements put in place for employees. Some funds will honour the age-based discounts provided by previous funds for individual employees, while others may come to individual discount arrangements with the company or corporation, depending on the average age and demographics of the employees to be offered health cover.

Health insurance by age group

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Young adults

Under 30s

Over 50s

Over 60s

Over 65s

Over 70s

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