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Health matters

The Voluntary Health Insurance Scheme (VHIS) is one of the topics up for discussion at “Employee Healthcare & Retirement,” the second HR conference to be organised by Classified Post this year. Employee benefits relating to healthcare and retirement are always a crucial factor for corporations trying to attract and retain talent, so it’s no surprise that the launch of the government-backed VHIS in April 2019 sparked widespread discussion. That discussion is set to continue at the Post’s HR conference, a half-day event which takes place at the Hyatt Regency Hotel on June 25 from 8.30am to 12.30pm.

The conference will host discussions aimed at educating attendees about several new tax concession arrangements, and will feature speakers from the insurance sector giving expert insights. There will also discussions about all the new trends in employee healthcare and retirement benefits. The educational seminar aims to update C-suite executives, VPs, directors, HR professionals, sales and marketing executives, and business development managers.

The best way to start such a conference is with an overview and a round-up of recent developments. Dr Gloria Siu, Chief Executive of Gain Miles Group, will set the scene with the latest instalment of “Beyond Employee Benefit Research and Indexes: Integration with VHIS.” Every two years, Gain Miles updates conference participants on employee benefits. This year, Siu will give an account of the latest key research findings, share the group medical indices, then follow up with likely implications for employers and HR professionals.

“VHIS has kicked-off a new era in the insurance industry, increasing insurance coverage and premium transparency,” Siu says. VHIS seeks to enhance the protection offered to individuals under the umbrella of hospital insurance, and participation is voluntary. By regulating VHIS products, the government is offering the public a new choice of insurance products with comprehensive coverage. Another plus is that the premiums can be claimed as tax deductions.  

“I will also be discussing how employers and HR professionals can integrate VHIS with group medical insurance. It is likely that the coverage standard of medical insurance will catch up with VHIS certified products to remain competitive in the market, and thereby ultimately improving healthcare for employees and many citizens,” Siu says.

“One of the key features of VHIS is that there is no lifetime benefit limit, and that guarantees that benefits do not lapse before clients reach the age of 100. This will provide medical coverage after retirement, as compared with group medical insurance which would end upon retirement,” Siu says.

Siu believes it’s the right time to give employers and HR professionals with some insight into how recent government tax incentives (like the MPF Tax Deductible Voluntary Contributions TVC, Qualifying Deferred Annuity Policy and VHIS) will affect employee benefits and retirement. “From the perspective of an independent and professional wealth and health consultancy, we observe that the MPF system of Hong Kong is evolving into a stronger pillar to support employee retirement funding,” she says. “Starting from its initial mandatory nature, different voluntary options are now ready. These include Voluntary Contribution (VC), Standard Voluntary Contribution (SVC) and the recently launched TVC to encourage employees to save for retirement,” Siu says.

For his speech “To V or not to V”, Dr Alexander Chiu will draw on his experiences on the provider side and in the public sector. As the Medical Director of Health and Employee Benefits for AXA Hong Kong, he says he will make his presentation in a more dramatic way to create more audience engagement. Chiu plans to walk the attendees through the VHIS journey, focusing on the reasons why people should consider VHIS. “Many people do not consider taking extra protection because they think they are sufficiently covered by employee benefits,” he says.

“But as they approach retirement, they realise that age causes more health problems at a time when retirement means their benefits will lapse. This usually happens because of complacency and lack of planning. An intelligent appreciation of the correct situation can help a lot of people become aware of such a painful fate,” says Chiu.

The programme includes a 40-minute panel discussion which is always guaranteed to stimulate conversations and audience interaction. The panel is moderated by Elaine Chan, a member of the Food and Health Bureau VHIS Consultative Group, and features Siu and Chiu discussing “Employee Benefits vs VHIS or VHIS vs Employee Benefits” Key discussion points will include the options which corporations can integrate with VHIS, and how vendors can facilitate the change.   

When it comes to practical information, nothing beats sharing a case study. Lau Ka Shi, Managing Director and CEO of BCT Group, will present “Leveraging New MPF Tax Concessions to Enhance Retirement Protection.” With the MPF system being the key pillar of retirement protection in Hong Kong, Lau contends that the adequacy of the system is always put under the spotlight. As average life expectancy rates in Hong Kong among the highest in the world, planning for retirement is an important issue for employees across the board.

“Based on the ‘Outcomes Based Assessment Framework for Private Pensions’ developed by the World Bank in 2016, Hong Kong’s MPF system performs well against international benchmarks in certain areas,” Lau says. “But ‘adequacy’ is one of the aspects that requires improvement. Moreover, the Organisation for Economic Co-operation and Development (OECD) commented that adequacy is the main concern about defined contribution plans,” Lau says.

“There are a number of solutions addressing the adequacy issue: increasing the contribution rate, automatic escalation of contributions, extending the contribution period, as well as providing financial incentives. The TVC is the government’s latest initiative to address the adequacy issue and help with the future financial needs of Hong Kong’s fast-ageing population,” Lau says.

“Delegates should expect some key takeaways from my presentation,” Lau says. “For instance: the adequacy issue of the MPF system, and why it relates to the retirement success of MPF members; more useful information about the new tax concession arrangement, TVC; how employees can leverage TVC to increase their retirement savings pool, and in turn enhance their retirement protection; and how HR practitioners can take the lead in educating colleagues about the government’s recent introduction of the tax deductible voluntary contributions plan, so they are fully aware of the potential benefits,” Lau says.

Employee healthcare benefits are the key to staff recruitment and retention, because salaries have only risen 2 to 5 percent over the last few years but medical inflation is trending much higher. Says speaker Elaine Chan, an experienced insurance professional, “Employees will treasure this medical benefit, viewing it as overall compensation. With this in mind, my presentation will provide a basic understanding of VHIS. I will discuss the scope of its coverage and other regulatory requirements, and its impact on the general public as consumers. I’ll also talk about the options offered to corporations to cope with the demands of VHIS and employees.” Chan’s presentation is called “How VHIS Impacts your Employee Benefits Strategy.”