Canadian HR Reporter

Canadian HR RepoRteR September 8, 2014 16 FeaTURes BeNefItS Making connections to improve health benefit plans Disconnects can cause problems for employers, employees By Chris Bonnett m any employers are ill- equipped to develop a strategic approach to health and managing health benefit plans. is is a particu- lar challenge for the many Cana- dian businesses with fewer than 100 employees. While an aging workforce means chronic conditions will only esca- late, many plan sponsors are not making the connections needed to respond appropriately, accord- ing to the 2014 Sanofi Canada Healthcare Survey. Employers will need to move beyond cost control and passive approaches to health promotion. Let's talk e first connection is with em- ployees: A resounding 90 per cent of plan sponsors believe their workplaces encourage health and wellness among employees. But only 60 per cent of employees agreed, indicating a big percep- tion gap. While health benefits are im- portant to all plan members — with four in five (78 per cent) reporting these are an important factor when choosing a job — only 52 per cent of plan sponsors say keeping employees healthy and productive is a main purpose of offering their health benefit plan. "It is important that health-care plan sponsors and plan providers design health-care benefit plans that respond to the needs of their employee populations," says Da- vid Willows, vice-president of strategic market solutions at Green Shield Canada. "e goal of the plan should be to keep employees well, so that those involved (sponsor, provider and employee) do not find them- selves with greater health costs and lost productivity." And while almost one-half (48 per cent) of plan members expect their health benefits will continue after they retire, only one-quarter (23 per cent) of the employer respondents provide post-retirement benefits — and only one-half of those (12 per cent) offer the same benefits plan as for active employees. e sur- vey sampled 1,502 plan members and 500 employers. Large numbers of retiring em- ployees are going to be surprised and disappointed, and will per- haps look to government to top up provincial health plans to provide the benefits no longer provided by their former employer. is is a connection governments will want to avoid, but one plan spon- sors and members should be con- cerned about in provinces where public drug plan eligibility doesn't begin until age 65. Retirement decisions may be deferred when early retirees know they will have no drug coverage. Identifying, acting on costs For decades, the dominant issue in plan management has been cost control. Fortunately, with data, we now can identify the drivers and mitigators of costs. Making new connections between datasets can also help assess differences within workforces — whether generational, income-based, oc- cupational or positional. is collection of health-related organizational costs — includ- ing benefit plans, presenteeism, workers' compensation and oc- cupational health and safety — allows us to see a much larger de- nominator than the two per cent of payroll typically devoted to the drug plan. In turn, that allows us to link and reduce the human, fi- nancial and operational impacts of illness and injury. However, only one-third (36 per cent) of employers say they regularly receive an analysis of claims data from their insurer or advisor, with a further 20 per cent receiving this type of information occasionally. And of those who do receive this type of data, just 49 per cent use it to develop targeted improvements to their plans. "e health care of Canadians in general would benefit from further partnership, informa- tion-sharing and data analysis," says Jon Fairest, president and CEO of Sanofi Canada. "By setting goals to optimize health and pro- ductivity, plan sponsors will reap the returns of reduced absentee- ism, improved productivity and an engaged workforce." Absenteeism is a good place to start. About six in 10 plan mem- bers have to fill in forms to report any absence (22 per cent) or ab- sences exceeding two days (40 per cent). Twenty-eight per cent have to contact their manager. Yet just 17 per cent of employ- ers worked with their insurer or benefits advisor to formally ana- lyze the drivers of absence and disability, according to the Sanofi survey. And 70 per cent indicate they didn't know what their ab- senteeism rate was for last year. e Conference Board of Can- ada estimated the cost of absence at about 2.4 per cent of payroll in 2012 — a cost too big to overlook. ere's a missed opportunity here for insurers and advisors to create higher value services for their cli- ents, ones that address both per- sonal and organizational causes. "Whether you think that health benefit plans are a huge cost or a small cost, why would you have any cost that you don't under- stand?" says Paula Allen, Sanofi Canada Healthcare Survey ad- visory board member and vice- president, research and integra- tive solutions at Morneau Shepell. Employers, governments support health Another increasingly urgent con- nection is between the two main payers — provincial governments and employers. is may be the trickiest connection to establish but it has already started in selec- tive ways. Both Quebec and New Brunswick have established de- liberate public-private strategies to ensure all residents have drug coverage. ose connections should ex- tend beyond drug policy. Govern- ments, public health and business all have interests in promoting health. Employees are at the cen- tre of such issues and their needs must be considered. Plan sponsors may begin by asking their insurers and advisors to play a bigger role in guiding health promotion. Indeed, 93 per cent of employers in the survey sample say they expect support from their carrier for health pro- moting programs, and 74 per cent say "a lot of support" is needed. Closer connections and greater trust might also reduce the ten- sion between those who pay and those who benefit. High-cost bio- logics and cancer drugs have cre- ated some anxiety in recent years. Now, expensive new vaccines for hepatitis C are being introduced and the first such product will cost about $55,000 for the drug alone. ese situations introduce the need for a new type of connec- tion — advocacy. In addition to engaging and directing insurers, employers will need to connect with each other to ensure their in- terests are considered by govern- ments and the drug supply chain. While individual employers may not have the time or resources to promote these interests, perhaps local chambers of commerce are prepared to take a larger role. Changes are faster and more complex, and single-party solu- tions will become increasingly inadequate, even counterpro- ductive. While the dominant focus of health benefit plans for the last three decades has been cost control, there are important opportunities related to better connections. Employers need to cross-pollinate by moving infor- mation and communicating their changing expectations to insurers and advisors. We ought to move beyond a singular focus on health benefit costs to the richer connec- tions between health drivers and organizational success. Chris Bonnett is president of H3 Con- sulting in Guelph, Ont., and a member of the Sanofi Canada Healthcare Sur- vey advisory board. Successful Companies Begin With Successful Leaders . Give Your Leaders the Skills They Need to Succeed 1-800-663-7305 info@NiagaraInstitute.com NiagaraInstitute.com • Public Programs • Client Solutions • Executive Coaching • Applied Research • Advisory Services Contact us to get your copy of the Public Program schedule! FREE DOWNLOAD ! Leverage the strengths and skills of your workforce— learn the dynamics of knowledge transfer. Bridging the Gaps: How to Transfer Knowledge in Today's Multigenerational Workplace outlines 15 methods for facilitating the flow of information and insight from those who have it to those who need it. 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