Quebec report – vive la difference May 01, 2010 | Richard Coté
2009 was a challenging year for Canadian employers as group benefits affordability issues arising from the ever-increasing cost of employee healthcare benefits, longevity concerns and the off-loading of government services were exacerbated by the recession. Quebec employers are facing the same dilemmas as organizations in other provinces—yet how they are addressing these challenges in 2010 is, in some cases, distinctive.
Over the past year, Hewitt Associates has conducted several national surveys of Canadian employers to examine the prevalence of and trends in flexible benefits as well as retiree healthcare programs. When responses from Quebec-based organizations are compared with those from the country as a whole, there are some significant differences.
While there has not been much legislative or regulatory change over the last year from a benefits perspective, amendments may be forthcoming if Quebec decides to follow the lead of Ontario and Alberta and reduce the cost of generic drugs. In the meantime, there are other measures Quebec employers may want to consider from a cost-containment standpoint.
Designing flexible plans Employers in Quebec are almost as likely to offer full flexible benefits programs as Canadian employers on the whole (23% in Quebec versus 25% nationally), according to Hewitt’s Flexible Benefits in Canada 2009 survey. They are also less likely to offer traditional non-flex plans (27% in Quebec versus 40% nationally). Of the 27% of Quebec-based organizations with traditional plans, only 17% have no intention of introducing flex—the other 83% are either in the process of implementing a flex plan or plan to do so in the future.
The plan design most popular with Quebec respondents is a modular flex plan, in which several benefits are grouped together (e.g., life insurance, disability insurance and medical and dental coverage are grouped together into high-, medium- and low-coverage packages) and employees choose the package that best meets their needs. Half of the Quebec employers surveyed offer this type of plan, compared with only 20% nationally. This finding may suggest that Quebec employers are less willing than their counterparts in the rest of Canada to offer more fully flexible plans, or that they have a desire to keep things simple for employees.
Quebec employers cited the same top three perceived advantages of flex as Canadian employers on the whole: meeting diverse employee needs; containing benefits cost increases; and improving employee attraction and retention. However, while the national sentiment was that meeting diverse needs is the foremost advantage and cost containment is secondary, the reverse holds true for Quebec employers. And when asked to name their greatest concerns around implementing a flexible benefits plan, employers across Canada cited administration and employee communication, in that order—yet Quebec employers stressed communication as a far greater concern.
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