As a new year begins, many organizations are considering their strategies for benefits plan management in 2018 and beyond. Faced with the challenge of balancing employee needs and wants with changing workplaces and escalating plan costs, employers should prepare for a number of issues in the near future.
Here are seven trends to watch in the coming year and beyond:
1. Personalized benefits experience:
Increasing workplace diversity, a multigenerational workforce and a more personalized consumer experience have led to a desire for the same experience in the employee health and benefits space as well.
With large amounts of data available, plan members and sponsors can expect a more integrated approach from their providers to create more personalized insight and support around their benefits plans. For example, an employee’s past claims history can provide guidance in decision-making around flexible plan options, and providers can use that data to send push notifications to members to ensure they stay compliant with their treatment and coach them on healthy behaviours. The information can also help them make wise buying decisions as they look to purchase products and services.
It’s also possible to integrate work perk programs by sending deals to plan members for products and services based on past purchasing behaviour. There will be a further unbundling of services as flexible plans become even more customizable to a plan member’s unique needs. With considerations such as privacy and consent, it’s a trend that will be more than a year in the making, but we’re already starting to see a more personalized experience emerging for plan members.
2. Financial wellness:
The concept has recently received more attention around how it connects with physical and psychological health. Financial wellness will continue to emerge as an important health consideration, with plan sponsors looking to support employees through accessible tools and programs.
While options such as budgeting support and debt management tools have been available to employees through employee assistance programs for some time, they’ll increasingly come to the forefront for employees or be highlighted as part of a company’s wellness offering.
We’re also starting to see more organizations provide new financial supports for employees. For example, in October, Benefits Canada reported on a pilot program launched by Great-West Life Assurance Co. to assist employees in the repayment of student loans without having to sacrifice saving for retirement. Existing programs will add those types of options, along with group registered education savings plans and help with childcare costs. Expect to see more options emerging for excess credits in flexible plans that tie to financial wellness as well.
3. Mental health:
Though mental health is hardly a new trend, it’s likely to stay at the top of employers’ agendas for a while. Mental-health claims continue to drive absenteeism, disability and drug costs, both as a primary diagnosis and as a co-morbid condition alongside chronic health issues. We’ve certainly seen a bigger focus in the past few years on increasing awareness about the prevalence of mental health, as well as efforts to address stigma. Those efforts will continue in the future.
The twist we’ve started to see here is a move towards a more tactical application through the provision of training for people leaders. As employers continue to adapt the national standard of Canada for psychological health and safety in the workplace to their own companies, we’ve recently seen a move towards mental-health first aid training, which will continue to cascade through organizations.
We’ll also see a greater emphasis on equipping managers with the tools to effectively accommodate employees living with mental-health issues to help them either stay at work or have a positive return after an absence. Concurrently, however, access to timely and appropriate mental-health care in Canada remains a challenge for many people. In response, a number of pilot projects launched by providers in 2017 offered digital modalities and alternative access to care or treatment. We can anticipate that to be an area of growth in the coming year.
4. Medical marijuana:
While the topic certainly isn’t a new trend, it will be a prevalent theme this year as employers try to determine how they’ll deal with medical marijuana, both in scope and eligibility in benefits plans and as a workplace health and safety consideration.
5. High-cost drugs:
Plan sponsors are expressing increasing concern about the effect of high-cost drugs on their benefits plans as new medications with high price tags continue to common the market. Helen Stevenson, president and chief executive officer of Reformulary Group Inc., says that “while these drugs can certainly have significant consequences on the sustainability of benefits plans, they also raise competing issues for organizations as they try to determine how best to spend benefits dollars.” She also notes that the price of those drugs is creating tension among all payers — hospitals, public programs and private plans — as they struggle with the extremely high costs.
Stevenson feels, however, that the current environment is creating the context for an overdue conversation by plan sponsors about plan management and looking critically at cost containment strategies.
6. Post-retirement benefits:
Employers will continue to divest from company-sponsored, post-retirement programs, directing their employees instead to continue to work on a part-time or contract basis or move towards an individual retirement plan.
Retiree exchanges and increased individual options offered by insurers are gaining momentum in this space, as employers look to help employees secure benefits after they retire without necessarily funding them. The marketplace is also creating a more personalized and customizable experience for retirees, who can choose a plan that addresses their claims needs and supports their retirement plans.
7. Cost shifting:
As plans continue to cost more, employers are considering the viability of their historical approach to benefits design, as well as new costs for supplies and services offloaded by public programs onto private plans.
As we’ve seen for some time with pensions, we’re likely to see more plan sponsors adopting a defined contribution approach to their share of plan costs. We’re also likely to see an increase in out-of-pocket costs for members through cost-sharing arrangements, the addition of or changes to co-insurance or caps on reimbursement levels and fees. Employers can use that as an opportunity to drive both a greater employee appreciation for the true cost of benefits, as well as engage their workers as active participants in plan sustainability.
A number of these themes are a continuation of an evolution we’ve already started to see in the recent past, but the way they’ll play out in the near future will be a bit different. As new practices and solutions emerge, organizations will be in a better position to deliver an improved plan member experience.