How to modernize your benefits plan post-pandemic

The new reality

Gone are the days where organizations looked at their benefits as an annual fixed expense. They would renew, repeat, and that’s it. The pandemic is predominantly responsible for the change in their approach. It shone a light on just how fragile our respective provincial healthcare systems are. The backlog for surgeries is disheartening. Scheduling a session to speak with a paramedical practitioner can take months.

Although the pandemic is over, Canadians have come out tarnished, broken, and seeking help. The post-pandemic world poses a new reality for Canadian employers. They are quickly mobilizing to align interests between all stakeholders: finance, HR, and their employees. With a smaller pool of quality candidates to choose from, employers are thoroughly reviewing their respective compensation programs to differentiate themselves from their competitors.

Working from home is increasingly popular, which in turn comes with its own HR challenges. This evolution in the workspace has companies mulling over best practices: what are they now and how do they install them ASAP. The question has therefore changed from, ‘How can we save more?’ to ‘How can we shore up our plan to attract, reward, and retain our employees for the next phase of growth?’

How are we?

Just before the pandemic, in January 2020, Sanofi conducted a survey, asking Canadian employers what was on their benefits wish list:

Pre- and post-COVID-19 coverage wish list

Canadian employees informed their organizations of the impact COVID has had on them. Eighty-four percent report a decline in their mental health^[i]; 34% fear becoming ill; 16% experience loneliness^[ii]; and there has been a 20% increase in claimants for medications relating to depression^[iii].

As a result, 82% of firms agree COVID had a major impact on their employees. These firms began to realize they needed to step up, all while understanding that Canadians may still be hesitant to physically see a specialist, scheduling an appointment was months away, or working from home meant less accessibility. Therein lies the evolution of benefits. A major pivot to virtual benefits would offer more access points for employees. Imagine a world in which an employee can speak with their psychologist, psychoanalyst, or divorce counselor virtually within days. Imagine your employees combatting their anxiety or depression virtually, confidentially, and without missing a day’s work. Picture an app that connects employees to pharmacists and delivers (without charge) prescription medications to their homes. A modern solution for a post-pandemic world.

Proactive vs reactive

A pivot to virtual care, installing a robust wellness offering helps proactively identify areas of concern, both from an organizational perspective as well as individual. Wellness’ main objective is to get to a plan member before they get on to a prescription medication. There are numerous advantages in installing a proper wellness program:

1. Among employers who offer wellness, more than half saw a decrease in absenteeism, and 66% reported increased productivity.
2. A change in corporate policy is a fundamental way to positively change the environment within the workplace.
3. Motivating a healthy structure begins with extrinsic rewards for healthy actions.
4. A reduction in stress and depression via communications about exercise, meditation, and mindfulness.
5. Building a community around wellness improves relationships between employees. It creates a culture of value, being heard, and respect.
6. A reduction in turnover is the outcome of a sound wellness offering.

Where to start

A byproduct of employers thoroughly reviewing their compensation programs is understanding the entire procurement process. Most employers have been conditioned to believe that having all their benefits with the same provider is a good idea – and are tied to one insurer. Having a single-source provider means employers are ultimately left with two choices at renewal time:

1. Accept incremental year increases.
2. Conduct a marketing exercise, which can either:
   • Lower incumbent premiums to market levels
   • Lead to switching providers

Another best practice is leveraging the power of a Third-Party Administration (TPA) platform to buy benefits. Instead of a single-source provider, a TPA procures benefits by line item, which could mean having numerous insurance carriers in the background but receiving a consolidated bill, booklet, and one card.

Now, employers can step away from the viscous cycle of marketing their plan every three years. All they must do moving forward is plug and play. There is no disruption to HR, finance, or employees. There is no headache of switching ALL benefits to a new provider. There is simply the TPA. Here’s where it gets interesting (for you benefits geeks): TPA’s can house virtual benefits and wellness programs, which allows them to speak to each other. For example, a wellness program can analyze the extended healthcare claims at renewal time, address the organizational symptoms, benchmark them against Canadian averages, and provide solid, in-depth solutions to combat these ailments.

Finding alignment

Establishing a committee made up of plan members, the plan sponsor, and an advisor would better equip a company in finding alignment between stakeholders’ needs and the bottom line. Benchmarks and surveying the requirements of plan members helps identify the unique desires of each respective organization. In this framework, it would be prudent for plan sponsors to work with their advisors to recognize and address the gaps. Capable advisors will help shed light on how to modernize benefits plans to attract, reward, and retain. The pandemic has forced companies to evolve, look forward, and think outside the box. Best practice would be to implement good governance and prepare for a world of service providers beyond the traditional offering.