Are your employee benefits plans well positioned for tomorrow?
At a recent Aon Hewitt Health Forum in Oakville, Ont., Tim Clarke, chief innovation leader, health and benefits, with Aon Hewitt, identified four key factors that will have a major impact on benefits plans from now to 2025.
No. 1: Demographics
By 2020, there will be five different generations together in the workplace—traditionalists to generation Z—and they will have different needs and expectations. Up to now, employers could simply target benefits toward mid-career employees, said Clarke. But that’s about to change.
“Late-career means something different than it used to,” he explained, noting that people are living and working longer. Aging boomers will need greater flexibility in the workplace due to growing healthcare needs. “Last time I checked, most doctors’ offices don’t work 24-7,” Clarke added.
Millennials, too, are driving change with greater expectations of technology in healthcare delivery. For example, rather than spending hours in your general practitioner’s waiting room, “why can’t you text a doctor and get that prescription refilled?” asked Clarke. This group also uses paramedical practitioners to a greater degree, so plan sponsors should be prepared for increased costs in this area, he added.
No. 2: Public health
Currently, the cost splitting for healthcare services between public and private payers is about 70%/30%. However, “we’re seeing a gradual shift from public to private—or public to employer—within the overall healthcare system,” said Clarke.
Critical changes in the delivery of healthcare—from in-patient to more outpatient procedures; from doctors to increased use of nurse, paramedical and pharmacist practitioners; from in-person to mobile health solutions; and from treating acute conditions to maintaining good health—will likely lead to increased costs for employers, he added.
No. 3: Lifestyle
On a global basis, data suggest that eight risks and behaviours (poor diet, physical inactivity, smoking and lack of health screening, to name a few) drive 15 chronic conditions that account for 80% of the total costs of all chronic illnesses.
“Humans are great creatures at knowing exactly what to do and not doing it very well,” noted Clarke. For this reason, he expects a greater focus on prevention moving forward.
No. 4: Technology
Medical advances may help save more lives—but they come at a cost. “On the whole, technology increases the costs in the healthcare system,” explained Clarke. “It’s a positive, but we have to recognize that it’s driving costs up, and we have to be prepared for how we’re going to deal with that.”
Driven in part by tech-savvy generations Y and Z, Clarke also expects to see technological advances to support healthcare access and delivery. He cited having a single electronic medical record and connecting with doctors via Skype to reach remote areas as areas of opportunity. “Technology has to really take hold in the healthcare system,” Clarke added. “It’s starting to do so, and it’s going to do so in leaps and bounds over the next decade.”
All of this means that employers need to take a more holistic look at their employee benefits offering. “How do we take full advantage of all of the data that’s out there to deliver better to our customers: our employees and their health?” Clarke asked, adding that employers need to consider what they need to do today to prepare their benefits plans for the future.
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