The pandemic has stretched the emergency preparedness, crisis management and business continuity plans of our clients beyond what any of us ever imagined. It has also created unique challenges and we have all had to learn to communicate differently. For Baynes & White (B&W), zooming with our clients was a new experience, however we have embraced the challenge. We want you to know that we have appreciated the value of our relationship through the pandemic. We do miss seeing you in person and hope one day to have that opportunity again.
In this article we wanted to run through some of the benefit changes that are being made or being considered as a result of the pandemic. If this inspires you to act on a change you may not have considered please reach out to your B&W Consultant. We are available to chat.
Prior to the pandemic many of our clients had not made any significant changes to their benefit programs for several years. Benefit programs were mainly reflective of the needs of two generation, the baby boomers and gen Xers, despite workplaces now being comprised of as many as four generations. We often heard that the millennials were not entirely impressed by the plans in place as they wanted more choice in what plans covered. With the many other projects and issues vying for HR’s attention, it was evident that putting a review of the benefit plan on the back burner was commonplace, and an easy option especially for overworked HR staff. Also, we found our clients reluctant to tackle any significant changes due to the time investment involved in a plan redesign and communication strategy. There were also concerns about the financial impact on employees. HR had no clear vision of employees who would be negatively impacted by change due to privacy legislation suppressing this information. Also, as with any change, the inevitable push back from employees if the plan was restructured, even if the rationale was to realign benefits to modernize the plan.
Then came the pandemic…
Initially our clients were totally absorbed by ensuring their business’ survival, their employees’ wellbeing, and setting employees up to work remotely. When they turned their attention to benefits the initial concerns were around potential employee layoffs and continuation of benefits for employees for what was hoped to be a temporary period. We were being asked questions from clients on how long they could continue benefits for, how to collect employee contributions, and the implications once the Long Term Disability benefit was no longer offered due to stipulations under the insurer’s contract.
There was renewed interest in Employee Assistance programs (EAP) and we assisted a number of clients implement programs or move programs to more appropriate service providers.
The government stepped in to offer a number of free mental health resources to individuals with the knowledge of the huge impact that social isolation, restricting travel and going from a smorgasbord of choices to virtually no choice at all would have on both physical and mental health.
Virtual care, which was not considered a benefit with much value suddenly was of interest, and we saw the introduction of this benefit ramp up. This lessened somewhat when the government, in response to the pandemic, funded virtual calls between doctor’s and their patients. However, employees and their families embraced the new virtual care concept as it addressed any immediate concerns without having to pre-book a call and overall they were very pleased with the end result of the service. We expect that interest in virtual care will continue and that service providers will expand their services under this platform.
Mental health apps like Snapclarity and Inkblot, gained popularity overnight. Plan sponsors / clients showed a keen interest in increasing and expanding coverage under their psychology benefit to include more mental health services and to provide more financial aid by increasing maximums for this benefit. Expanding and increasing maximums allowed employees to claim for these services through the psychology benefit with less out-of-pocket expense.
Mental health claims for disability have surged and are expected to continue to increase for the foreseeable future. Insurers are proposing, and in most cases, standing firm on double digit increases in LTD rates on a benefit that is generally employee paid. Benefit changes may be considered to reduce cost, however with the immense value of this benefit we are not suggesting change. We have seen more interest in a transition from an employee paid to employer paid benefit due to the high increase on the LTD premium, however the benefit level generally needs to be increased due to the change from a non-taxable to a taxable benefit. Also cost share is generally re-structured on the health and dental to offset the cost to the employer, however on a positive note, this has employees contributing to benefits they value. Also for layoffs it reduces the administration of having to attempt collect premiums from employees.
The flexibility that the millennials and Gen Z wanted was finally now being considered by more clients. With gyms closed and many wanting to stay in shape wellness accounts gained popularity. Clients were allocating wellness dollars to support employees in their endeavor to stay physically active. Also we saw coverage being expanded to include coverage for office equipment for their remote workers.
Interest in Health Care Spending Accounts (HCSA) spiked as well to give employees access to dollars that were being saved due to low paramedical and dental claims.
In closing, more change is on the horizon. Benefit plans are finally getting the attention they need to be relevant to everyone in the workforce. We will expect to see more benefit dollars directed to wellness especially for mental health, more EAP’s added or moved to more appropriate vendors and virtual care being a common component of the plan.
Your Consultant at Baynes & White is available anytime to discuss any aspect of your plan. We encourage you to reach out.