July 2020 – COVID-19 has forced us to rethink and retool almost every aspect of how we do business. If your group benefit plan has not yet been a part of that process, now is a good time to consider making some changes. In fact, some of the ripple effects of physical distancing—such as savings generated by reduced claims activity and, more generally speaking, society’s deep dive into virtual health care—have opened the door to a rapid evolution in benefit offerings.
“The benefit plan that worked in 1990 was still working reasonably well until four months ago. We are advising all of our clients that now is the time to rethink your benefits,” said Kevin McFadden, president, McFadden Benefits in Winnipeg, Manitoba.
Before COVID, “attraction and retention” was a frequent, generic response to the question of why employers offered health benefit plans. In a world with COVID, attraction and retention become more like aftereffects of the primary purpose of benefits: to help protect the health and productivity of employees.
“Employers are developing a deeper understanding and appreciation of why benefit plans matter. We have an opportunity to build on that and shift focus to more proactive health care,” said Andrea Hansen, partner, Sutton Benefits & Pension in Saskatoon, Saskatchewan. “If we don’t take down barriers to access in care and if we don’t proactively encourage employees to take care of themselves, which includes physical distancing, then the negative results will show up in business performance.”
Among her clients, business owners who actively promoted self-care and brought in new benefits in response to COVID—or simply ramped up communications for what was already there—were much more likely to continue to thrive, observed Hansen. On the other hand, employers who historically looked at benefits as a cost, and who cut them back in response to COVID, were more likely to struggle with labour issues and productivity.
Reinvestment of savings
Claims activity for dental and paramedical services plummeted in the last four months, resulting in unexpected savings for both ASO and insured plans. “Most insurers have offered premium relief, which we’ve never seen before. This has enabled plan sponsors to gain the financial resources to add benefits that are relatively low cost and very high value at this time, such as employee family assistance programs and telemedicine,” said Hansen.
While dental and paramedical claims will eventually return to pre-COVID levels, and perhaps briefly spike due to pent-up demand, it will be months before costs for the new benefits register as an increased spend. By then, the positive results will speak for themselves, predicted Hansen.
She cited one client who coincidentally began funding access to telemedicine just before the pandemic hit. Since then, more than 60% of their employees have set up patient accounts and more than 20% used the service for primary care from physicians. “The utilization and positive employee feedback far exceeded their expectations,” said Hansen.
Zoom in on COVID
For the next year at least, or until physical distancing is no longer required, the focus will be on improved virtual access to health-related products and services. An Abacus poll commissioned by the Canadian Medical Association found that almost half of Canadians have accessed a physician virtually (by phone, text/email or video conference) since the start of the pandemic. Nine out of 10 reported being satisfied by the experience, and 46% would prefer a virtual method as the first point of contact with their doctor going forward.
COVID has clearly catapulted virtual primary care into action in the public healthcare system. Public acceptance will lead to growing expectations, as consumers look to be able to safely access services across the full gamut of providers, from medical specialists to mental health practitioners, physiotherapists, dietitians, and the list goes on. That translates into opportunity for private health benefit plans.
Both Hansen and McFadden are having increased conversations with clients about incorporating virtual care as an employee benefit. “There are really viable solutions in virtual health and virtual pharmacy. COVID has required that private benefit plans finally give them the attention that is their due,” said McFadden.
Your benefits advisor can help you choose the virtual care provider that best meets your needs. As a member of The Benefits Alliance Group, your advisor has access to two providers at preferred rates: EQ Care, a Canadian provider of 24/7 services in primary care, mental health and paramedical care, and Alliance Pharmacy, for the delivery of medications supported by virtual pharmacist consultations. “COVID has really shone the light on the convenience and the advantages in cost structure of virtual pharmacy,” noted McFadden.
Outside of virtual health services, optional life insurance is another benefit worth promoting at this time. “We’ve seen an increase in employees applying for optional additional life insurance,” said Hansen. By reminding employees of its availability, you also reinforce the value of benefits during this time. “It goes back to encouraging a change in people’s perspective on the importance of benefits, so they are less likely to take them for granted.”
To that end, regular communications on everything that is available in your plan—with a focus on mental health supports—will resonate during this time. Research by the Conference Board of Canada indicates that 84% of Canadians have greater mental health concerns as a result of COVID-19. By sending reminders of what’s available through your health benefit plan (especially if an employee family assistance program is available), you are communicating that you care.
And in today’s increasingly virtual world, your benefits advisor can help put together video clips and live online Q & A sessions. “Even before COVID, communicating about benefits was challenging, especially in blue collar environments. Today the increased acceptance of video conferencing has opened up a new and exciting way of communicating,” said Hansen.
Simple, YouTube-style video clips, ideally no more than a minute long each, are most effective. “You want to shine the light on one benefit at a time, for example by reminding employees that their EAP is available for mental health support,” said McFadden.
The bigger picture
The disruptive impact of COVID presents an opportunity for more foundational changes to group health benefits as well. For example, this could be a good time to switch from an insured plan to administrative services only (ASO) funding. “ASO used to be the domain of larger companies, but in the last 10 years it has become more feasible and viable for medium to smaller-size companies, with as few as 25 employees,” said McFadden. “This is a good time to step back and at least consider a change in funding model.”
Plan members’ growing desire for flexibility and choice—in the form of non-taxable health spending accounts and taxable personal spending accounts—will also likely accelerate as we settle into the new normal. The more user-friendly, the better. “Any tech-related support where employees can have better access to the benefits that matter most to them is super-important,” emphasized McFadden, adding that The Benefits Alliance Group has a partnership with myHSA , a software provider that facilitates flexibility and access to benefits.
Last but not least, the fostering of a wellness culture in the workplace will be more valued than ever. In the latest Sanofi Canada Healthcare Survey, conducted in January 2020, 86% of plan members agreed that a workplace environment that encourages health and wellness is an important factor when deciding on a job offer or remaining at an organization. The survey goes on to state that the three top factors for a wellness culture are safety, good relationships with co-workers and a good relationship with their immediate supervisor.
Plan members likely feel this way even more strongly today—yet a wellness culture has become somewhat more challenging for employers to maintain in a world with physical distancing. Even when required physical distancing ends, we can expect alternate work arrangements, such as working from home and flexible hours, to continue at higher levels than in the pre-COVID world.
“The effects of isolation are very real,” said McFadden. Mental illness can be one result. Equally detrimental is the potential drain on productivity at a more widespread level. “We’re going to have to find creative ways to continue to build a sense of work community. Now is the time for employers and their benefits advisors to really start thinking about that.”
First published in the July edition of Take 5 for Health Benefits.