Wondering what’s most talked about among benefits plan advisors and what they’re especially concerned with these days?
In our last post we covered key stats from the 2022 Benefits Canada Healthcare Survey and shared trending employee benefits plan concerns for employers. While that survey focuses on feedback from plan administrators and members, NMG Consulting’s Canadian Group Benefits study asks consultants, brokers, and advisors for their input, so the perspective is a little different. We saw some overlap between the two studies around concerns with plan pricing and cost containment, but advisors are generally looking ahead to what’s coming in the benefits plan space.
Read on for a glimpse into what our peers in the advisor community are talking about when it comes to employee benefits plans.
1. High-Cost Drugs: Top concern with benefit plan advisors
Cost containment and the challenge of high-cost drugs was raised by 25% of respondents, making it the number one concern in the study. With uncertainty around future plans for National Pharmacare and the rise of new and expensive specialty drugs, benefit plan advisors are looking more and more at what carriers have in place for cost containment.
For one of the very first times ever, we’re seeing drug plan maximums mentioned in this study, which is definitely an indication that it’s become a hot topic in the industry. The good news is that patient assistance programs are becoming more common, which can absolutely help address the concern. For example, if an employee submits a claim for a specialty drug, some carriers will proactively reach out to suggest the least expensive option and find the best coverage assistance. This ultimately helps the employer by avoiding or reducing the impact of a high-cost claim, which could have resulted in an increase in premiums at time of renewal.
2. Long-Term Disability (LTD) Pricing
18% of benefit plan advisor respondents raised disability pricing and management as their biggest concern. This isn’t surprising given some recent rate hikes that we’ve seen from some insurance providers. The challenge here is that the carriers who are increasing LTD premiums on a regular basis are the same carriers who are less likely to decline coverage to a new group regardless of their disability experience.
Benefit plan advisors in the study are particularly concerned with affordability of group disability benefits for small business. Often, we use some creative thinking like looking at whether it’s possible to alter certain elements of LTD in a plan to help lower pricing.
On another hand, higher mental health claims are a huge driver of rising LTD costs. Hence, it’s worth asking whether employers are doing enough to address mental health issues in the workplace. Doing so could potentially reduce claims and help contain some of these LTD price increases in the long run.
3. Telemedicine: what benefit plan advisors are talking about
Technology and telemedicine is one of the top challenges raised by benefit plan advisors in the study, and this makes sense to us. We’ve heard anecdotally from many in the industry that telemedicine is becoming increasingly top-of-mind. With a substantial generation of doctors beginning to retire, the trend we’re seeing is that they’re unable to find someone to take over their practice. As a result, patients now have the difficult task of finding a new family doctor. Telemedicine can absolutely fill that gap so it’s a fantastic solution, but it’s not without challenges.
Keeping up with the technology, making sure that insurance providers offer the right coverage, and educating plan members on how telemedicine works are all important factors for its success. The reality is that telemedicine isn’t going anywhere and we’re likely to see more of it in the future – there are more doctors moving online, and many are starting to book phone or virtual appointments for any consultation that doesn’t require a physical examination with their patient.
Would you like to know what we think the biggest trends and concerns in employee benefits will be in 2023? Let’s chat! Contact us and we’ll be happy to share our thoughts.