Employers are increasingly facing a tight labour market and need to compete for top talent with a stronger benefits offering.
Using technology to compare offerings across insurance companies and other providers can ensure employers have a cost-competitive plan that speaks to employees’ needs, said Matt Lister, co-founder and chief executive officer at CloudAdvisors, during Benefits Canada’s 2022 Tech Insights conference in mid-April.
According to Lister, 90 per cent of Canadian businesses — representing more than one million employers — haven’t updated their employee benefits plan in 10 years. That means many employers have made no changes to key benefits offerings including disability coverage; to their drug plans to address emerging issues around biologics, high-cost specialty medications and digital pharmacy; or to mental-health coverage and other benefits that meet diverse employee needs.
“That problem — the impact of that problem — is really felt by employees and their family members. They’re relying on their extended health benefits for access to health care for access to dental care, for access to mental-health resources and new things they otherwise wouldn’t be able to access.”
Lister said this situation can be partially attributed to Canada’s unique market — while 80 per cent of employers offer some type of benefits plan, 98 per cent are small- or medium-sized employers with fewer than 100 employees. Their benefits decisions are made behind closed doors, often with the business owner and human resources representative along with an advisor. This brokerage approach, he said, isn’t working at scale: employers need more accessibility, transparency and simplicity to help them make benefits decisions.
That’s why Lister developed CloudAdvisors, a digital platform designed to provide employers with access to the employee benefits marketplace, give advisors access to more data that helps them provide better advice to their plan sponsor clients and allow providers to show off their solutions.
CloudAdvisors partnered with more than 100 providers in its searchable solutions marketplace, representing nearly 600 benefits and group retirement solutions, products and services. It also developed its own artificial intelligence-powered advice assistant, Caleb, that automatically evaluates benefits plans. It then benchmarks them against a database of benefits information from more than 15,000 Canadian organizations, which Lister called the largest and most detailed agnostic database of employer offerings in the country.
The organization’s evaluation process analyzes each benefits plan to look for potential recommendations, solution matches and eligible products and services, producing an instant evaluation with priority plan insights that plan sponsors and their advisors may want to address. It also develops instant quotes for solutions and compares the nitty-gritty details such as deductibles, co-insurance and definitions.
The plan’s advice assistant also delivers insights to plan sponsors about their competitiveness in relation to other companies in their sector, region and group size. Lister said Caleb benchmarks all the plans in the database multiple times per day to look for new trends, new listed offerings or differentiations from providers and updated pricing on solutions.
“They say the devil’s in the details — well, Caleb looks through all of those details to make sure you’re not missing anything.”
This information is summarized into a bar score — which stands for benefits, attraction and retention — that Lister said is a universal ranking for benefits and retirement plan health. The ranking system considers numerous plan variables, including benefits and group savings offerings and tiers of coverage for different levels of employees, and tells employers how their plan stacks up against competing plans in one score. Plan sponsors can also see their percentile ranking against all plans nationally and provincially, companies of their size and within their industry.
“The score influences the insights and will track your performance over time,” he said, adding that employers can receive notifications if their benefits aren’t competitive. Employers that have competitive scores, meanwhile, can use them to tell current employees about the robustness of their offerings and demonstrate to prospective hires that they didn’t just check a box when it comes to employee benefits.
Read more coverage from the 2022 Tech Insights conference.