How the Employee Benefits Discussion Has Changed with COVID

Rather than scaling back, leading Canadian employers are looking for ways to beef up their plans

How the Employee Benefits Discussion Has Changed with COVID

As a benefits consultant who collaborates closely with Canadian companies of all sizes, I have had some interesting conversations with my clients that have led to numerous proactive changes over the pandemic period. With the COVID-19 pandemic perhaps approaching its end, the employers we serve are moving quickly to align their benefits offerings with the tightening job market, with the intention to leverage this tool as a true form of compensation.

Based on my discussions, you have been extremely busy adjusting to the new reality. Almost all of you have told us that you want to enhance your plan. The questions we are getting do not include ‘How can we save more?’ or ‘What can we take away?’ Rather it is now ‘How can we shore up our plan to attract, retain, and reward our employees for the next phase of growth?’ and ‘What can we add to our offering to help our employees with their mental health?’

The pandemic has changed the benefits conversation. In my experience, leading Canadian employers are:

  • Preparing for a spike in dental utilization over the next six to 18 months.

For those firms that are ASO (administrative services only), they are retaining their budgeted surpluses to cover an expected increase of claims that will plateau in 2023. For those firms that are fully insured, preparations are underway for larger increases in dental rates at renewal.

  • Adding Virtual Doctors

The pandemic exploited the need for (and the availability of ) online appointments for healthcare providers like doctors and nurses. As a result, increasingly, firms have added virtual doctor appointments (and nurses) to help their staff:

  • attend appointments from their home or office, 24 hours a day
  • Avoid visiting clinics during the period of transmissibility of disease(s)
  • Reduce time off for in-person visits

Enhancing the number and type of paramedical practitioners that they currently cover

Firms are reconsidering the basket of practitioners that are currently covered (massage, physiotherapy, chiropractor, etc.) and adding new services that were previously not covered (psychologists, social workers, family counsellors, and psycho- therapists). Most are doing this while not increasing their dollar spend.

  • Measuring their utilization according to mind and body focused services

Firms are asking for reporting on a year over year basis highlighting differences in utilization of healthcare services that are focused on mental health versus physical health. They are using this data to drive plan design changes, inform their wellness strategy, and help employees drive productivity.

  • Adding and/or increasing their healthcare spending accounts

These accounts help firms serve their multigenerational workforce by allowing maximum user flexibility while limiting corporate financial exposure, all on a tax- free basis. One popular approach is adding various levels of spending accounts by class. A tiered approach means incrementally higher spending accounts based on class or seniority (Exec classes receive highest amount, etc.).

  • Adding wellness spending accounts

In an encouraging new development, firms are growing more comfortable with adding taxable spending accounts for expenses like gym memberships, Pelotons, smart watches, and other health focused activities.

Strengthening their LTD plans Long-term disability (LTD) plans are being strengthened by better coverage parameters to adequately cover their higher earners. Moving to Guaranteed Standard Issue (GSI) for LTD is emerging across our client base to remain competitive within certain Canadian industries. GSI is a disability offering that provides enhanced coverage beyond the traditional scope of LTD offered directly through a group benefits plan. A stacked combination (GSI & group benefit offering – reversed) offers a unique and comprehensive benefit that can make a plan that much more competitively advantageous. The pandemic has led organizations to take a strong look at how they value their health and, in turn, how to adequately protect themselves in time of need. This strategy also helps drive better cost stability over time as incidences of LTD and duration of claims increased through the pandemic.

  • Benchmarking

Comparing how their plan design is versus the competition ensure an employee benefits offering is consistent with the business strategy. If it is inferior, how they can do better.

  • Asking us for advice

Employers are looking for ideas on how to defend their employee benefits offering to new recruits as the recruitment market tightens up.

  • Moving their health and dental to ASO

To take advantage of streamlined costs and reporting, small- and mid-sized firms are considering moving from purchasing health and dental on a fully insured basis to ASO. Most large firms are already using ASO.

  • Asking for deeper and more frequent reporting of all the above.

Not sure how to begin? Start a conversation with your benefits consultant.


Jamil Jamal is a Benefits Consultant at People Corporation.