Healthcare for MSMEs

What are MSMEs?

MSMEs stands for Micro, Small & Medium Enterprises. MSMEs are the pillars of the socio-economic development of the country due to their significant contribution to GDP, exports, and employment generation. There are approximately 633.88 lakh MSMEs in India, with 324.88 lakh in rural areas and 309 lakh in urban areas.

According to the laws of the Micro, Small and Medium Enterprises Development Act, 2006, MSMEs are classified into two divisions:

Companies in the manufacturing sector: This includes enterprises engaged in manufacturing or production of goods for an industry listed in the first schedule of the industries (Development and Regulation) Act, 1951.

Companies in the service sector: This includes enterprises engaged in providing services.

Based on their annual turnover and investment, manufacturing & service companies are classified into the following subcategories:

Micro	Small	Medium
Investment not exceeding Rs 1 crore and turnover of up to Rs 5 crores	Investment of not more than Rs 10 crore and turnover not exceeding Rs. Rs 5 crores	Investment of not more than Rs 50 crore and turnover of up to Rs 250 crores

How are MSMEs contributing towards India’s development?

MSMEs in India started with the establishment and growth of India’s coir and khadi industry along with various other industry types, common in rural India. A high number of micro and small enterprises belong to the agricultural industry, whereas medium-sized enterprises are primarily in the automotive, textile, chemical and pharmaceutical industries.

The contribution of MSMEs has given a major boost to the Indian economy with a contribution of 30.5% to India’s GDP in FY19 and 30% in FY20. MSMEs account for approximately 40% of India’s total exports, 6. 11% of GDP from the manufacturing sector and 24. 63% of GDP from the service sector.

As per a study conducted by the Ministry of Statistics & PI between July 2015-June and 2016, the MSME sector employed over 111 million workers.

How are MSMEs transforming healthcare and wellness in their workplace?

Despite being the key contributors to economic growth and development, MSMEs have limited access to financial services including employee health insurance. In addition to this, entrepreneurs themselves are not familiar with insurance being a significant risk mitigation tool. Commonly available insurance offerings are not adapted to cater to the requirements of MSMEs. While MSMEs face many risks, they lack adequate risk management strategies. MSME workers involved in the manufacturing and service industry face great personal risk, which not only impacts the business, but also the lives of their family members. Operating with limited funds to handle emergencies, MSMEs face higher exposure to threats and disasters.

Providing insurance to MSME employees is a great way to retain them and makes for a great employee benefit too, making them feel cared for and looked after.

KPMG in association with FICCI in India conducted a survey involving 219 MSMEs from 15 different sectors in manufacturing and services. The results brought forward the reality of workforce welfare in terms of health coverage. The study revealed that insurance penetration is at a low 31% in the MSME sector as compared to 85% covered in large corporations. If we take a closer look into the number of MSMEs that provide health benefits to their employees, it is exceptionally low.

The MSME sector employs an estimated 11 crore people in India and according to IRDAI, only 5% of the 633.88 lakh MSME businesses offer insurance to employees or are insured.

Pandemic has not spared anyone

The MSME sector was severely affected by the pandemic due to which enterprises have now understood the importance of insurance and how it can help them protect their business and workforce.

In India, approximately 90% of MSMEs do not offer any financial aid for medical purposes to the families of employees. Post the COVID-19 lockdown and outbreak, people have started taking their health seriously. One indispensable tool that has helped people all over the world deal with COVID-19 is health insurance. However, the same could not be said for the MSME workforce.

Post lockdown, the Indian Government and IRDAI have made insurance mandatory for employees. Earlier, offering insurance coverage was not mandatory for businesses. However, a circular was issued in April 2020 by IRDAI stated that it is mandatory for all industrial and commercial establishments, workplaces, offices, etc., to provide health insurance to their employees.

Moreover, IRDA has also advised insurance companies to devise comprehensive health insurance product with simple wordings & conditions and offer affordable plans to large, medium, and small-scale organizations.

MSMEs To achieve universal health coverage, it is important is important to educate MSMEs to accept and allocate funds for insurance as an employee benefit. This can happen through partnerships and policy amendments. Protecting employees works well in the favour of MSMEs, helping them retain and hire new talent.

After the impact of COVID-19, MSMEs are now partnering with healthcare companies that offer holistic healthcare solutions for improving the overall well-being of their employees. Insurtech companies are leveraging technology to MSMEs with comprehensive healthcare & wellness benefits for your employees at affordable rates. Providing comprehensive healthcare & wellness benefits will help MSMEs retain and hire new talent.

Importance of enabling next-generation healthcare benefits for the workforce

Digital tools are transforming the healthcare market, significantly improving healthcare outcomes, and making healthcare accessible to all. Healthcare providers have embraced modern technologies and are shifting towards customer-centric models. Similarly, employers are demanding the most convenient healthcare solutions take care of their employees.

Here are a few of the important healthcare benefits that employers are looking for in the workforce –

Teleconsultation

Social distancing and staying at home topped the demand for teleconsultation, which is easily accessible and cost-effective. This mode of doctor consultation has enabled quick diagnosis, helping the doctors get access to real-time insights of the patients.

Smart wearable and devices

Wearable technology devices like sleep bands, smart watches, bio patches, etc. help employees to track and maintain their health. From heart rate, and footsteps to reproductive health, wearable technology tracks it all, thus helping doctors create personalized health plans for the employees. All medical health details and vitals of the employees are perfectly captured in the devices.

Digital electronic medical records

Digital prescription is one innovation that is transforming the healthcare landscape as they help in maintaining digital health records of the patient. This helps both the patient and the doctor, reducing the chances of human error or interpreting wrong medicines.

Wellness benefits

Today, health applications provide patients the convenience of booking diagnostic tests, ordering medicines online, consulting doctors online, access mental wellness sessions, etc. And employers these days, when selecting health care plan for employees, look for these benefits and offer the same as a part of their employee wellness benefits package.

How to select the right health and wellness products for employees

Selecting the right health and wellness product for employees is important. You can select the right health and wellness product for your employees by opting for a company that provides holistic and customized employee healthcare solutions.

An ideal employee healthcare plan should cover the following

• Health insurance & accidental cover
• Telemedicine service
• Discount on diagnostics
• Discount on pharmacy

You can choose Onsurity healthcare membership for your employees to get access to all the above health, wellness benefits and much more!