Top Benefit Plan Trends
The following is our list of the Top 10 trends plan sponsors should be aware of in designing benefit plans for today – and tomorrow.* These trends, namely shifts in workforce demographics and changes in benefit expectations, underline the need to find new ways of doing things that balance member health with plan sustainability.
1. Big price tag - In 2016, the total annual bill for health care in Canada was $228 billion – or nearly $6,300 per Canadian - compared to $43 billion in 1976. The price tag will only get bigger as key drivers of health care spending, like Canada’s aging population, accelerate, demanding that we find new ways of doing things to mitigate costs without compromising member health.
2. Different experiences, expectations – For the first time in history, the workforce is evenly split between three major age groups: 20s and early 30s, late 30s and 40s and 50s and 60s. The life experiences of young, middle aged and older workers are as vastly different as their expectations for health benefits – and seldom do they overlap.
3. Multi-generational workforce – We are close to having five distinct generations working side by side. Millennials now outnumber Boomers and GenX in the workplace. These generations have diverse consumer characteristics, preferences and needs, making the case for a cross-generational approach to benefit plan design.
4. Silver tsunami – The number of Canadians over age 65 is dramatically outpacing total population growth. This silver tsunami will have a profound impact on health spending as these aging baby boomers are staying in the workplace longer, but also retiring in record numbers. According to our analysis, boomers claim way more than their fair share of drugs to treat medical diseases and conditions that often accompany aging.
5. EHC spending up – Extended health care (EHC) benefits continue to show the strongest annual growth per capita. In 2016, the annual increase was 12%, exceeding that of drugs by almost four times. This is largely due to an increase in claims for paramedicals such as massage therapy, especially among younger workers who are seeking alternative therapies to stay well.
6. Paramedicals are popular – We are seeing a tremendous growth in the popularity of treatment by paramedical practitioners. Our claims data shows that almost 1 in 7 covered persons is claiming for a massage therapist; 1 in 9 for physio and 1 in 12 for chiro. This is consistent with industry trends.
7. Mental health claims on rise – According to Mashable, Millennials report depression in higher numbers than any previous generation. And as the stigma related to mental health wanes, more workers are looking for resources at a younger age. This is also reflected in our claims data. In 2016, 15.6% of plan members claimed for drugs for mental distress/disorders, up from 14.8% in 2014.
8. Chronic disease crisis – Nearly 6 in 10 employees report having a chronic disease or condition, such as diabetes, asthma, COPD, hypertension and high cholesterol. This makes chronic disease the single biggest driver of health plan costs exceeding that of specialty drugs – and increasing every year as new, higher cost therapies come on the market.
9. Drug costs skyrocketing – The riding incidence of chronic disease and the introduction of new, more expensive therapies to the market pose a major cost impact to benefit plans. Consider also that claims for drugs start to skyrocket when members reach their 40s. Excluding dependent children, over 23% of the plan member population is now claiming for cardiac drugs, while 1 in 15 covered members has diabetes.
10. Open to Self-Care - The 2017 Sanofi Canada Healthcare Survey shows that Medavie Blue is leading the way when it comes to empowering employees to self-manage their health. According to the survey, 61% of plan members would access the services of a health coach if it was part of their plan. Our Managing Chronic Disease provides expert supports to plan members so they can control their condition and adopt healthy lifestyles.
As you can see, the status quo is no longer acceptable. The time is now to take an integrated, cross-generational approach to benefits management that combines traditional health care options with relevant and responsive self-care and drug management solutions. The result: plans that meet diverse needs and expectations in an ever-changing and complex landscape, while mitigating plan costs without compromising member health.
Note: Our Top 10 list is a summary of the high-level data Derek provided in his webinar presentation “Benefit Plan Trends in a Rapidly Changing Workforce” on June 21, 2017. To view a recording of the webinar click here. To be notified of future webinars, contact us at 1-800-667-4511 or email GroupBenefits@medavie.bluecross.ca.