Although rising costs for pension and benefits plans continue to be a concern for employers, many plan sponsors are finding ways to address the challenges they face, participants at a recent Benefits Canada roundtable discussion in Toronto pointed out.
Among the priorities is mental health, given the challenges the issue can present. As Barbara Martinez, practice leader for group benefits solutions at Great-West Life, pointed out, the average spending on drugs for someone with mental-health conditions is about $1,800 a year, with 20 per cent of that amount attributed to anti-depressants. That’s almost double the $948 cost for those without mental-health conditions.
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And with the strong link between physical and mental health, it has become a “business imperative” for employers to be strategic, said Paula Allen, vice-president of research and integrative solutions at Morneau Shepell. “We’re in an increasingly brain-based, cognitively driven economy. We’re requiring that from pretty much everyone, and that’s what really drives our business productivity.”
Allen was among the participants at an Oct. 20 roundtable discussion during Benefits Canada‘s Workplace Benefits Awards event at the Arcadian Court in Toronto. The event brought together finalists for the awards with other leaders in the pension and benefits industry to discuss the array of challenges facing plan sponsors.
When it comes to the mental-health issue, Allen said companies should look at managers and supervisors who interact with employees on a daily basis. “We can’t just have cost outside of business,” she said, noting the importance of “equipping and making managers capable of being the front line in terms of identification and knowledge, of how they should support mental wellness and how to intervene when somebody is in distress . . ..”
In its case, St. Joseph’s Healthcare Hamilton sends managers to develop leadership skills through a mental-health training program at Queen’s University, said Betty Kenney, manager of human resources, benefits and wellness at the hospital. “It trains managers on how to approach employees that they believe may be experiencing mental-health issues, how to have that conversation, how to be open and supportive, because sometimes with mental-health issues, people want to back away . . ..”
Service providers are also doing their part to help employers have discussions about mental health in the workplace in order to address issues early on, said Travis Kelly, director of group disability claims and operational support at Desjardins Insurance. “So to be able to make the conversation around mental health normal the way a conversation about back pain may be [normal] is something we’re trying to do. . . . It doesn’t cost as much, even if you don’t do the actual training, . . . to have a conversation with your client and say, ‘These are the things you can do when somebody goes off with this kind of condition.'”
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When it comes to pension plans, employers are trying to educate members about financial issues so they can make better decisions for retirement, roundtable participants noted.
Many people simply don’t have the skills to made complex decisions about their personal wealth, said Peter Shena, executive vice-president and chief pension officer at the Ontario Pension Board. “What we found is our membership getting stressed about financial decisions, particularly about retirement.”
To provide support, the Ontario Pension Board has enlisted employees who are certified financial planners to provide unbiased guidance to members with questions about their savings.
Other plan sponsors are trying to be proactive by offering general financial information seminars to employees while refraining from handing out specific advice.
St. Joseph’s Healthcare Hamilton, for example, is hosting a six-part financial literacy series for employees, said Kenney, who noted the forum has elicited questions “from people who had no idea what they’ll be facing in the next five or 10 years.”
Financial health, notably debt, is the No. 1 stress factor for millennials, said Nigel Branker, leader of the defined contribution pension consulting practice at Morneau Shepell. He suggested employers could examine their plan designs to see whether they address the kinds of support younger employees need.
“I think sponsors have to make a call. . . . Are we prepared to help them cope . . . or do we start thinking more creatively about our program design? So maybe not additional spend, but is it really the best return for us to be saving for pensions, versus helping them pay off debt?”
Service providers are trying to not only help employers be strategic around their plan design but are also striving to offer innovative and unique solutions, according to Christine van Staden, vice-president of national accounts at Great-West Life. “Innovation is one of the pressures we face in the marketplace . . . so we are doing everything we can to push the envelope.”
In its case, Great-West Life is piloting an online financial platform, called Wayfinder, that allows plan members to automatically link their individual savings with their workplace retirement plans so they can see the effect on their retirement and savings goals. The platform also analyzes their financial picture, pulling information such as their eligibility and matching rules, to deliver personalized recommendations they can act on right away, according to van Staden.
As a plan sponsor, CAA South Central Ontario has been questioning whether traditional pension plans are necessarily relevant to its workforce, noted Mary Duncan, vice-president of human resources. She said that instead of looking at employees based on the generation they belong to, the organization has started taking their lifestyles into account.
“Millennials will go through what I went through [as a baby boomer] at a different stage,” said Duncan. “[They] may buy a house or have children later or earlier. But it’s the lifestyle. We believe that if we start educating the young all through the different lifestyles, regardless of age . . . that will help.”
Regardless of the strategies and tactics they pursue, companies want to see the return of their investments at the end of the day, said Caroline Morin, director of compensation, benefits and human resources shared services at McKesson Canada Corp. “Showing how we can invest and reduce costs, I think, it’s key,” she said.
To provide a strong business case, plan sponsors need to have very specific and measurable plan objectives that clarify the outcomes members want to focus on, said van Staden. “If they have specific objectives every year to build on, then they are going to be able to set the stage for effective partnering with providers . . .,” she said.