It’s that time of year again. Health insurance costs and resulting taxes are on their annual price hike.
Over the past 18 months we have extensively discussed developing concerns within the employee benefit landscape with many of Australia’s leading organisations. One of the main recurring concerns we have found is with regard to FBT costs associated with subsidising employee’s private health insurances. The resulting taxes incurred through offering this benefit are too large for many organisations to absorb, and as such they simply refrain from offering the benefit. With a lack of pro-active advice broadly across the industry about this topic, many have placed the benefit into the “too hard” category. We understand that by retracting this benefit organisations may not be able to attract or retain talented staff.
We’re here to help. There are a number of strategies that we have developed that will reduce or cap the costs of private health insurance, and the resulting FBT expenses.
At Lockton, we assist clients in restructuring their corporate health plans so that costs can be accurately forecast and capped on an annual basis. This allows the company to continue to provide an employee benefit that is market leading and doesn’t reduce the entitlements to the employees. There have been a number of health insurers that have entered the corporate market along with the existing insurers developing new value propositions. By restructuring and redesigning your corporate health plan, you will gain access to a richer product suite along with additional services that may assist in reducing costs within other health and wellness related programs.
If your company has a subsidised health plan, ask yourself these couple of questions:
- Are you concerned with escalating premiums and the flow on effect to FBT?
- Have you been with the existing health insurer for the last three years?
- Have you reviewed alternative structures and products?
- Have you considered cashing out this employee benefit?
If you have answered yes to any of the above, please contact us to discuss how we can assist in strategically reducing your costs.
National Manager, Private Health Insurance
+61 474 648 906
We have been able to save clients considerable amounts on premiums and the associated FBT costs whilst enhancing the overall offering to their employees.