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Alexandra Slimming, Head of Global Benefits, shares key milestones from Q4 as well as considerations and industry trends for the quarter ahead.
We’re currently seeing relatively low rate increases for Private Health Insurance in Australia as part of the 1 April 2022 rate reviews. The average rate increase is currently sitting between 2-3%, which is well below previous years, and several leading providers such as Bupa, Medibank, and GU Health have stated their intention to either delay increases or extend slight increases into October 2022 as part of this year’s review. A key reason for this year’s low rate increases is the widespread cancellation and/or delay of elective surgeries during Covid’s peak. In addition, lockdowns and Covid-related concerns meant members weren’t utilising their extras cover for treatments (e.g., dental, vision, and physiotherapy) at pre-pandemic levels. This resulted in increased profits for health providers who are now passing some of their savings back to consumers.
Reproductive Health in the US: Travel-Related Expenses & Health Plans
On June 24 this year, the Supreme Court in the US overturned the Roe v. Wade decision (1973). In response to this ruling, we have seen many US-based companies commit to providing support and financial assistance to employees seeking abortions in states that have outlawed the procedure. In what many organisations have deemed critical healthcare, some are even looking to include travel expenses for abortion-related procedures in employees’ benefits packages.
Health Plans within the US may cover travel expenses that are primarily for essential medical care, however, some health plans may not cover, or sufficiently cover, abortion-related expenses. In response, many US organisations are deploying programs outside their traditional health insurance plans to support employees’ access to reproductive care. Companies such as Microsoft, Netflix, JP Morgan Chase, Amazon, and more have issued statements on covering travel-related expenses to assist their employees. We’ll be sure to publish more on this matter as the situation develops.
The 4-Day Working Week
The idea is simple: employees work four days a week with the same workload and receive the same pay and benefits. In exchange for a commitment to maintaining 100% productivity, employees are expected to operate for 100% of their current pay, for 80% of the time. Welcomed by many as ‘the future of employee productivity and work-life balance', the idea is to give employees more freedom and flexibility to arrange their working hours and workload. In turn, it is believed this will enhance operational efficiencies, and support employee attraction and retention within organisations offering this option.
In the UK and Europe, various organisations have begun piloting this format. Around 70 companies in the UK with 3,000+ employees are part of a pilot being run by Cambridge and Oxford Universities, including Boston College and not-for-profit groups such as 4 Day Global and the 4 Day week UK campaign. Interest in the 4-day working week is also gaining momentum in the US, Ireland, Canada, Australia, and New Zealand. We’ll continue to keep you abreast of this trend over the term ahead.
From 1 July 2022 in Australia, all employees are eligible for the Superannuation Guarantee (SG), regardless of income (removing the AUD $450 per month eligibility income threshold). For companies with employees under the age of 18, the SG is only payable to individuals working 30 hours per week or more. Furthermore, the SG rate increased from 10% to 10.5% on 1 July. We will see 0.5% increase in the SG each year through to 2025 when it reaches 12%. It is important for organisations to check with their local Payroll provider to ensure they’re across these changes.
