Most Indian companies providing healthcare cover to their employees are grappling with an average 10 per cent rise in premiums over the past three years, according to a survey.

“In 45 per cent of the cases, one of the major reasons for rise in premium was the advent of sophisticated medical technologies,” Watson Wyatt, a global consultancy firm, said in its Health Care Benefits survey.

However, employees seeking excessive care and malpractices such as over-recommendation of services were also cited as major reasons for the rise in premiums. “Employers feel that these factors would also pose significant challenges in providing affordable healthcare to employees in the future,” the survey said.

The survey conducted in the second half of 2009 covers 125 of India’s largest employers. The respondents represent a cross-section of industries, mainly from the private sector, reporting an average revenue of more than Rs 400 crore.

In spite of rising premium costs, economic turbulence and the difficulty in maintaining an affordable healthcare cover, 58 per cent of the companies surveyed did not deduct any premium costs out of employee salaries. Over 46 per cent of those surveyed did not plan to share the costs with the employees even in the coming year.

Kulin Patel, head of benefits practice, Watson Wyatt India, said, “Rising healthcare costs are making companies strive to strike a balance between increasing premium costs and talent management strategies. To achieve this objective, it is crucial that companies constantly review and customise their healthcare plans.” It is vital that employers design appropriate plans, employ efficient ways to manage them and ensure that employees understand their value, he added.