How costly is absenteeism due to illness?

Health-related absences can be costly, and the loss of personnel can disrupt business operations. Employers with healthcare plans see decreased absenteeism (50%), increased productivity (66%), and higher employee satisfaction (67%). Offering health plans serves as an affordable alternative to wage increases, which may not keep up with a fluctuating Naira. For brokers, it’s an opportunity to deliver value to corporate clients while contributing to Nigeria’s economic health.

Businesses are increasingly viewing employee health plans as strategic initiatives. Evidence shows that companies supporting employee wellness experience significant economic benefits. Employees engaging in wellness initiatives report an 81% reduction in absenteeism, a 14% increase in productivity, and a 43% decrease in turnover.

The World Economic Forum notes that companies with strong wellness programs had a 115% growth in earnings per share compared to 27% for their competitors.

When Employers Neglect Healthcare plans for their team, they are leaving themselves vulnerable in many ways.

Chinedu is the head of sales at an organisation that does not offer health insurance. During a critical sales window for the organisation, Chinedu’s wife falls ill. He takes a leave of absence from work to attend to his wife while dipping into their family savings to sort medical bills due to rising finiaical costs. However, due to the nature of the deal, he returns to work earlier than he should; he doesn’t close the deal because he is stressed and can’t focus on the fine details. He eventually falls ill and has to take an enforced leave. While there are people who can fill in for him, the notice is short, and they are not as effective as they would hope. The department’s productivity falls agonisingly short of perceived levels.

Chinedu’s experience is not unique. Across Nigeria, many employees face similar challenges, leading to a vicious cycle of absenteeism and financial hardship. Without health insurance, employees like Chinedu are more likely to experience stress and absenteeism, which can affect their well-being and the companies they work for.

Increasing healthcare cost in an opportunity for both businesses on multiple scale

Increased healthcare utilisation and rising costs are driving medical inflation globally. According to the World Economic Forum, medical inflation is expected to continue outpacing GDP growth.

African nations, including Nigeria, experience higher medical inflation than the global average. The devaluation of the Naira, combined with general inflation, has led to a spike in healthcare costs. Most medical equipment and over 70% of pharmaceuticals in Nigeria are imported, and even locally-produced medications rely heavily on imported ingredients. Rising fuel costs further exacerbate the situation, increasing the overhead costs of medical facilities.

While a few government initiatives like the National Health Insurance Scheme have alleviated this burden, they only cater to government workers. These factors undermine Nigerians’ spending power. Many people already pay over 70% of their healthcare out-of-pocket, one of the highest rates in the world.

Health Insurance: A Golden Opportunity

With all of these mentione, the African continent is considered a hot region for insurance, valued at around $68 billion and growing rapidly. This benefit is in two ways. One, private health organisations can leverage this to create plans that can close down these gaps. Non-health players can leverage these statistics to provide robust health coverage that meets the needs of its employees while creating an exclusive and exciting benefits plan without significantly committing more business finance. Given that healthcare bills are a significant recurring expenditure in many homes, creating a plan that helps employees do more with their remuneration is a wise and strategic business move.

Wellness Benefits as Drivers of Prosperity and Growth

Employee health plans is a powerful tool to insulate against hidden costs and drive economic performance. Traditional approaches like healthcare stipends and direct retainerships with hospitals are becoming less appealing due to budgeting difficulties and limited employee choice. In contrast, tailored healthcare plans with consistent premiums offer a wide range of services and leverage the purchasing power of pooled resources—a sustainable investment.

Selecting the Right HMO Partner

Small businesses lose an estimated N23,399 to N113,399 per employee annually due to illness-related absenteeism. This number rises to between N24,650 and N414,700 for large businesses. By supporting health plan implementation, employers can reduce these avoidable costs and drive employee engagement. However, choosing the right health insurance partner is crucial for success. Here are key factors to consider:

1. Digital Solutions

Digitalisation is essential for expanding healthcare access. Telemedicine, for instance, could improve healthcare access for over 186 million Africans [12](https://www.undp.org/publications/digitalization-accelerating-telemedicine-adoption-africa).

It saves patients money and time, reduces geographic barriers, and lowers healthcare costs while enhancing service quality. When evaluating HMOs, consider their commitment to digital solutions. Have their solutions been developed in-house or outsourced? What is the adoption rate among plan members?

2. Customer Service

Rebuilding consumer confidence in Nigerian health insurance requires excellent customer service. Evaluate the HMO’s corporate retention and support team structures, customer satisfaction ratings, and available support channels. How responsive are these channels, and are they digitally supported?

3. Provider Relationships

Strong provider relationships are vital. Poor payment resolution has historically damaged trust between businesses, individuals, and HMOs. Assess the HMO’s network size, payment speed, and digital processes for efficiency. Do they collaborate with providers to improve performance? How do providers rate their experience with the HMO?

4. Strong Funding

Strong investor backing ensures the HMO’s financial stability and ability to cover clients in all scenarios. Look for diverse and reputable investors who bring expertise that can help the HMO remain innovative.

5. Health Specialty

Some insurers treat health as one of many services, risking quality and innovation. An HMO focused solely on healthcare aligns all budgets and talent towards delivering high-quality health plans. Consider the HMO’s focus on healthcare innovation and the percentage of the workforce dedicated to it.

6. Nationwide Coverage

A provider network’s size doesn’t guarantee quality or accessibility. Freedom and flexibility in provider choice empower insured employees. Ensure the HMO offers nationwide coverage with provider roaming, allowing plan members to switch providers as needed and maintain coverage across locations.

By considering these factors, brokers can select the right HMO partner to implement effective health plans, drive employee engagement, and reduce costs in a challenging economic climate. This strategic approach benefits businesses and contributes to Nigeria’s overall economic health.

Reliance HMO has been steadily raising the bar.

Tradition health insurance and next-gen HMO

With everything that has been stated thus far, traditional health insurance currently does a lot. In recent times, however, the demand is beginning to change. For example, traditional health insurance may cover unforeseen events, but it lacks the proactive approach necessary to truly benefit your organisation. Conditions like burnout and poor physical and mental health do not come up on the radar until they are late. Instead of gambling on the chance of illness that affects productivity, your company needs proactive health management strategies.

Reliance HMO offers comprehensive health plans designed not just to cover emergencies but to actively improve the health and well-being of your employees. By providing access to a network of clinics and hospitals nationwide and additional benefits like dental and optical care, wellness checks, and gym access, Reliance HMO promotes good health and reduces the need for costly interventions down the line.

Unlike traditional health insurance, which remains dormant until a crisis occurs, Reliance HMO plans actively encourage wellness as a lifestyle. The gym and spa subscriptions are one way we do this. This approach benefits employees and the business, improving health, morale, productivity, fewer absences, and a stronger employer brand. Reliance HMO is truly customer first.

We focus on healthcare excellence. Our benefits are crafted by healthcare professionals dedicated to promoting public health and ensuring the well-being of your workforce. We are laser-focused on healthcare, with no distractions diluting our efforts to offer better service.

We pride ourselves on being the “best of breed” in business health plans. Healthcare is not just part of our portfolio—it’s our passion and sole focus. Every aspect of our operation, from plan design to technological innovation, is geared towards making healthcare experiences seamless, accessible, and convenient.

By choosing Reliance HMO, you can be confident that your employees’ health is our top priority. There are no competing interests or distractions—just a relentless commitment to providing your organisation with the best possible healthcare solutions. Let’s start talking today.

Call us at 02017001580 or 02015200094 or visit www.getreliancehealth.com for more information. We can’t wait to talk to you.