Canadian HR Reporter

CANADIAN HR REPORTER DECEMBER 2019 NEWS 11 Prioritizing plan sustainability Exclusive roundtable explores possible solutions such as health-care innovation, personalized medicine, fraud intervention E mployer-provided medi- cal benefit costs in Can- ada have been rising dra- matically each year, for years. As a result, many employers have been inclined to remove products or services from ben- efits plans as a way to cut costs, according to Rommel Fifi, di- rector of business development at Sun Life in Toronto. But employees value their benefits more so than before, he says, citing a recent survey that found 67 per cent of Canadian employees would rather keep their benefits plan than receive an extra $5,000 in salary. It is something people are pay- ing more attention to and really making sure that their employer offers benefits, says Fifi. "Since employees have placed such a high value on the benefit plan, the employers aren't able to [make cuts] anymore. So, we have to find creative ways as to what we can do to keep these plans sustainable." In September, Canadian HR Reporter hosted an exclusive roundtable sponsored by Sun Life that explored the issue of benefits plan sustainability, in- cluding: What is driving the in- creases? What are some tools and approaches that can help com- bat the rising costs? How can all stakeholders play a part? Rising costs a challenge There are quite a few factors driv- ing up benefit costs, with one big one being the aging workforce, says Fifi. "In 2021, there'll be a 30 per cent increase in the number of people over age 55 in the work- force… but it puts a strain on the benefits plan." As people grow older, there's a higher prevalence of chronic disease. For example, there are 50 per cent more people with Type 2 diabetes today than there have been in the last 10 years, he says. "That puts a strain on the bene- fit plan because… you are going to be needing more medication and you're going to be needing more therapy." There's also a greater preva- lence of high-cost medications, says Fifi. "We estimate that this spe- cialty medication is going to rep- resent over 40 per cent of benefit plans in the next few years. So, that's a quite a large portion of the benefits spend that is going to drugs that could be upwards of hundreds of thousands and sometimes millions of dollars." The situation we're facing to- day is only going to get tougher, because the costs of an aging workforce, chronic disease and drug expenses are not going away in the foreseeable future, says Marie-Chantal Côté, vice- president, market development, group benefits at Sun Life. "When we talk about the aging workforce — well, that's prob- ably not going to change for the foreseeable future. When we talk about chronic disease, that's also not going to change," she says. "And the cost of drugs? We know that we have an entire new category of drugs entering the market on gene therapy that's going to also make that even tougher," says Côté. "It's time to think about this now to course- correct the [benefits cost] curve for today and for tomorrow." And that correction involves all stakeholders, she says. "Benefit plans are meant to help employees live healthier lives... be productive, and live fuller lives. So, it's important that they play a key role in main- taining that plan for themselves. The second piece is employers looking at their plans in a mod- ern fashion, looking at some of the different forces, different fac- tors, etcetera, and making sure that their plan is aligned with that and encouraging the use of these tools." The third piece involves pri- vate payers such as Sun Life, which have the skills of nego- tiation, and providers, who can provide tools and information to employees, says Côté. "Together, with the govern- ment, with different forces, we will be able to bend that curve." Focusing on sustainability A 2019 study done by the Confer- ence Board of Canada found that both the short- and long-term priorities for employers when it came to benefits plan is sustain- ability, she says. "[It's about] providing solu- tions, options, ways of looking at the plan to eliminate some of the inefficiencies, and looking for ways to generate the most value from the plan." One of those solutions involves leveraging health-care innova- tion, says Côté, citing one of the recommendations in Sun Life's Bending the Benefits Cost Curve white paper. This involves enabling tech- nology to deliver health-care ser- vices in better and more cost-ef- fective ways. For example, online cognitive behavioural therapy (CBT) can be a very successful tool in providing much-needed access to plan members. "There's different barriers to accessing this therapy and some of it could be cost, some of it can be geographical location, some of it can be stigma around talk- ing about anxiety, depression," she says. "Helping employees live healthier lives early in the diag- nostic cycle, to me, is a great way to bend the benefits cost curve. So, through providing more ac- cess, quicker — [and] leveraging digital technology to do that — is one component." Personalized medicine such as pharmacogenomics — leverag- ing genetic testing so patients re- spond better to medical drugs — is another component, says Côté. "The principal is trying to help employees feel better sooner," she says. "Research has shown that it often takes multiple times before a patient finds the best drug for their condition only because one of the key factors for determin- ing how you will react to it is your genetics. So, two of us can have the same condition, but one of us will react differently to the drug." Employees who are on disabil- ity can take the test to determine which drug would work best for them, says Côté. "What this does is it signifi- cantly accelerates your ability to be back on your feet, return to work and live a healthier life." Insurance companies such as Sun Life can also leverage their scale to negotiate better prices with pharmaceutical manufac- turers, and negotiate discounts on health-care products and ser- vices so that plan members have great products at a lower price — and at a lower cost to the plan. "We vet and review those types of services so that our plan members can then feel comfort- able that these are very solid, rich offerings that will help provide good outcomes… at very good prices," she says. Another solution towards plan sustainability involves health consumerism, according to Bending the Benefits Cost Curve. This is about empowering plan members with information and tools that help identify the prod- ucts and services that are best for them, based on quality and value. "There is an opportunity to help provide more information to plan members, to help them reduce their out-of-pocket or their copay, help sponsors with the plan sustainability and help the full ecosystem," says Côté. "There's an opportunity to help employees, plan members be- come better health consumers with more access to information so they can get the most value from their plan." Historically, this has been a place where employees don't really understand the costs that are associated with the servi- ces they're getting, says Fifi, "whether it's massage therapy or physiotherapy or whether they're From left: Sun Life participants Joseph Peter, vice-president of fraud risk management; Marie-Chantal Côté, vice-president of market development, group benefits; and Rommel Fifi, director of business development. TOO> pg.12 "ey need to have the action plan in place so everybody's on the same page, because ultimately the impact will translate to reduced benefits." SPONSORED BY

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