Getting the most out of what’s spent on employee benefits plans is an ongoing challenge for drug plan sponsors. In May, nearly 200 drug plan stakeholders gathered in Vancouver for the third annual Face to Face Drug Plan Management Forum, where industry experts discussed the latest drug plan trends and offered ideas for managing costs and improving health outcomes.

David Willows, vice-president, strategic market solutions, with Green Shield Canada (GSC), shared findings from GSC’s 2014 health study. As he explained, this was the first time the annual study went beyond just drugs to create a bigger picture of employer-sponsored health benefits consumption in Canada. Drawing on a database containing millions of health claims, the study breaks down the volume and cost of claims for drug and paramedical health benefits consumed by Canadians in age bands ranging from birth to retirement.

“We want to get people thinking differently,” said Willows. “When it comes to benefits plan design, what we offer employees has stayed remarkably the same over the past 30 years. But if we had a blank slate starting today, and we knew everything we know now about Canadian healthcare and demographics, what would a benefits plan design look like? In our estimation, it would look materially different from what we have now.”

While employers offer employee benefits for a number of legitimate reasons such as attracting and retaining talent, and improving employee health, Willows noted that the GSC study is aimed at employers that are looking for a return on investment (ROI) and health outcomes that are tied to their health benefits. He added that based on current trends in cost and consumption of drug and other health benefits, a significant proportion of benefits spending doesn’t contribute much in terms of ROI on the health side.

The 2014 study was the first time GSC had looked at claims for paramedical services. Willows acknowledged being surprised at finding high claims for chiropractic and massage not from actual employees, but from their young member dependents. “There is something happening that we would never have imagined when paramedicals were first added to benefits plans,” he said. “Claims for massage are going up substantially, and, although we’re not saying massage shouldn’t be in plans, it has absolutely no impact on fighting disease. So if [you’re] looking for long-lasting health outcomes and this is the fastest growing cost in your benefits plan, then you have to ask yourself a question.”

Willows suggested plan sponsors take a look at the 5% of claimants for paramedical services who account for 36% of costs, based on GSC’s survey results “We found this group was likely to use multiple benefits over the year, with massage being the most used add-on benefit, with physiotherapy and chiropractic treatments. We may think intuitively that there is a downstream positive impact for people who use these benefits—it makes them feel better, so arguably their usage of other benefits should be lower than other plan members. But in our study, when we looked at those who use massage and chiropractic and compared their drug costs to others who didn’t use them, we found their drug costs are, in actual fact, higher.”

Rather than stick with the status quo, Willows suggested that benefits plan sponsors focus on new initiatives that could have a bigger impact on keeping people healthy and, thus, better manage costs. People with chronic diseases such as hypertension, high cholesterol, depression and diabetes have higher overall claims and costs than those without these conditions. Considering the high levels of non-adherence to medication in these populations, improving compliance could help make people healthier, Willows said. “Our experience has shown over the past few years that improving adherence moves some of the high-cost claimants to average-cost claimants, and that provides savings to the plan.”

Although traditional benefits plans haven’t changed yet, Willows suggested that sponsors put stronger emphasis on wellness and prevention, specifically aimed at chronic disease. “Why can’t benefits plans cover health screenings, health coaching and the services of registered dietitians? We are just at the beginning of such discussions, but we do know, in the backdrop, the cost of chronic disease is going up, and it’s only going to get worse.”

All the articles from the event can be found in our special section: Face to Face Drug Plan Management Forum coverage.

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Traice Schmerling:

The message in this article is that benefits for massage therapy do not contribute significantly to productivity in the workplace. And yet there is a PhD thesis that suggests that massage increases productivity. Employers should consider this before accepting the idea that massage benefits should be reduced.

Tuesday, June 30 at 9:41 am | Reply

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