How Selcare Covers Small Companies, Curbs Health Care Costs For Big Ones

Selcare manages employee health benefits for companies, from small ones with 15 staff to large corporations with thousands of staff and dependents. SMEs get to offer similar health benefits as big companies, while PKNS saw a 74% drop in health care costs.

KUALA LUMPUR, March 11 – Navigating insurance and covering employees’ health care expenses can be both complex and expensive. As health costs continue to climb, corporations of all sizes are finding ways to cut spending while still caring for their workers.

For the Selangor State Development Corporation (PKNS), this commitment translates into providing extensive health care benefits to its 930 existing staff and over 3,000 dependents, as well as about 1,000 pensioners and their spouses.

“We did an analysis of cost trends from 2018 to 2020 and noted a significant increase in our medical expenses. The projection indicated that our medical costs would rise from RM16 million in 2018 to approximately RM19 million in 2020,” said PKNS human resource manager Saiful Anwar Muhamad Sharif in an interview with CodeBlue

“We had to figure out a way to reduce the cost. That was when we looked at several third-party administrators (TPAs), including Selcare Management Sdn Bhd.”

For small and mid-size enterprises (SMEs) like Otaido Industries Sdn Bhd, providing employees with health care benefits – often uncommon among SMEs – allows them to compete with larger corporations in hiring and retaining talent. Otaido Industries is in the car accessories business.

“We started our car cover business in 2018 with five employees. Now, we have 15 staff, and our product range has expanded to include covers for motorcycles and even helicopters,” Otaido Industries director Sahidah Zakaria told CodeBlue in a separate interview.

“It’s important for us to offer medical benefits to our staff because we are up against larger companies that can provide such benefits, unlike SMEs like us. Our budget is limited. So, we had to look at alternative solutions that would allow us to offer similar health benefits as larger companies, but within our financial constraints,” she added.

Health concerns were particularly amplified during the Covid-19 pandemic, Sahidah said. 

“People became more health-conscious during Covid; they were concerned about getting infected. That was when we decided to prioritise protecting our staff. We explored various options, including insurances and TPAs, and were introduced to Selcare Management.”

With Selcare, PKNS’ Health Care Costs for Staff Dropped 74%

An Iltizam Selangor Sihat panel clinic. Photo by Selgate Group of Companies.

Established in 2017, Selcare Management functions as a third-party administrator (TPA), handling claims, processing, and reporting for health benefit plans. The company is a Selgate Healthcare subsidiary under state-owned Selgate Corporation.

In addition to running the Selangor state government’s health care programmes, Selcare Management has extended its services to include corporate clients, such as state-owned PKNS and Otaido Industries.

As a TPA, Selcare Management is dedicated to providing direct access to quality health care and assisting companies in effectively managing their health care costs. Currently, Selcare Management boasts a network of over 2,000 panel clinics and more than 200 panel hospitals nationwide.

Since teaming up with Selcare Management, PKNS has seen a remarkable decrease in health care expenses for its active staff, falling from RM19 million in 2020 to RM5 million in 2022.

Saiful Anwar attributed this staggering 74 per cent cost reduction in PKNS’s health care expenses over two years to the company’s monitoring of its staff benefit schedule.

“When we analyse our medical costs, they are controlled by the schedule of benefits. This schedule determines what the TPA, in this case, Selcare Management, will approve for any services sought by our staff. Previously, every item claimed was approved because the schedule of benefits was too broad and generalised.

“Upon closer scrutiny and discussion with Selcare Management, we identified items that could be filtered. By filtering certain items, we observed a decline in costs year on year.

“For instance, childbirth. Previously, the coverage was unlimited. Any charges from the hospital were covered by us. Instead of maintaining such broad coverage, we introduced caps. For normal and caesarean births, we set limits.

“So, when Selcare Management provides reports on these adjustments, we see a decline in costs,” Saiful Anwar elaborated.

PKNS’s health benefits for staff and their dependents (spouse and children) cover inpatient and outpatient services, childbirth and postnatal care, dental, physiotherapy, and pharmaceuticals. Pensioners and their spouses receive an outpatient medical benefit of RM1,000 annually.

Cost Effective: ‘We Only Pay For What We Use’

Otaido Industries Sdn Bhd director Sahidah Zakaria speaks to CodeBlue in an interview at Otaido’s Head Office in Shah Alam, Selangor, on February 1, 2024. Picture by Alia Amira Zulkhairi/ Selgate Group of Companies.

At Otaido Industries, the strategy for maintaining manageable overhead costs is to pay only for what they need. “We don’t want to increase our overhead. Using Selcare, we only pay for what we use. That’s why we find using Selcare more cost effective,” Sahidah said.

Otaido Industries’ health package for staff primarily covers outpatient treatment and dental care. Currently, the company provides annual medical coverage of RM500 per employee.

“Most of our staff are young and so far they have no chronic or hereditary diseases. So, the usage is not significant. When we only have to pay for the services that our staff receive at the clinics, it becomes cost effective because there are no additional charges. It’s also not a monthly fixed cost,” Sahidah explained.  

To date, employees at PKNS and Otaido Industries have encountered no difficulties accessing health care services at Selcare panel clinics or hospitals.

Staff simply need to present their identity card at the clinic, and their details will be retrieved from the Selcare Management system. A guarantee letter is not required unless staff need to be referred to the hospital, in which case Selcare Management will provide it.

Tailored Solutions For Every Corporate Client

Selcare Clinic at Unisel Shah Alam, Selangor. Photo by Selgate Group of Companies.

PKNS administrative assistant Norazzrin Abdul Malek values Selcare Management’s personalised and prompt approach in dealing with every client.

“Selcare has been very helpful, not only in terms of pricing and packages offered but also in providing excellent service – quick response from the staff we deal with for guarantee letters, and prompt responses from panel hospitals – these aspects add value for us.

“At PKNS, we aim not only to control our expenses but also to ensure the quality of service provided to our staff. We are the only two people at PKNS handling medical matters for both pensioners and staff. So, we are short-handed when it comes to managing 900 staff at once. The staff at Selcare truly help us a lot,” Norazzrin said.

Selcare Management assigns dedicated teams or individuals to oversee each corporate client. “They have a dedicated team to liaise with us at PKNS,” Saiful Anwar said.

“Over the years, we’ve been in constant communication with this team, conveying our needs, and reviewing our schedule of benefits annually. They are able to focus on our requirements and are available for in-person meetings whenever necessary.”

Selcare Management also provides detailed reports on the company’s health care expenses on a monthly or quarterly basis. This is true not only for large corporations like PKNS, but also for SMEs like Otaido Industries.

Otaido Industries receives precise monthly breakdowns from Selcare Management, detailing per-employee spending, services utilised, and service locations.

“So far, I don’t have any problems contacting Selcare because every company is given a person in charge. For Otaido, we have our designated person. If I need to add or adjust anything, I will just contact our person in charge and make the changes,” said Sahidah.

“Many SMEs like us experience high turnover rates. So, whenever there is a change in our workforce, we can immediately update our policy with Selcare Management. 

“With most TPAs or insurances, we cannot make changes immediately when an employee leaves; we have to wait for a year for the policy to mature.”

Sahidah said Selcare Management’s plans are highly suitable for SMEs on limited budgets. 

“Medical benefits are crucial in any workplace today. It’s something basic that has to be provided. But many SMEs, especially those involved in e-commerce, are unable to provide medical benefits to employees due to cost constraints.

“For companies with fewer than 20 employees, it’s really hard for us to find a TPA that allows us to provide health benefits to our employees – and Selcare Management provides just that.”

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