Why offer health benefits to employees?

Posted by on Sep 15, 2016 in Uncategorized | No Comments

Employers tend to see these incentives as a way of boosting productivity, while workers consider them to be compensation or a useful resource, writes Sara Tatelman for Benefits Canada.com.

Boosting productivity is the top goal of providing a health benefit plan, according to 64% of employer respondents to the 2016 Sanofi Canada Healthcare Survey.

The survey found employers also implement health benefit plans to maintain employee satisfaction (60%), attract and retain employees (60%), and take care of catastrophic health-care costs (32%).

Organizations with at least 500 employees are more likely to value the productivity benefit plans bring (67%) over attraction and retention (55%).

Employee perspectives on the goals of health benefits plans vary widely as well, according to the survey. Some 43% of plan members use benefits plans to treat and prevent illness or injury, and 35% see them as extra compensation to use as much as possible. The remaining 23% see benefits as both compensation and a health resource.

Among employee respondents, younger plan members (aged 18 to 34) are fairly evenly divided between viewing benefits as a resource (40%), compensation (30%) and both (30%). Employees aged 55 to 64, on the other hand, are more likely to consider benefits as a health resource (49%). Another 35% of older employees see them as compensation, and 16% see them as both.

While some members of the survey’s advisory board anticipated that more employee respondents would see benefits as extra compensation, others pointed out that claims data shows just a small percentage of plan members maximize them.

Employer respondents, for their part, believe employees use benefits when they need to (54%) as opposed to seeing the plans as extra compensation (21%).

“The gaps are actually quite noteworthy,” said advisory board member Lisa Callaghan, Assistant Vice-President of product and group benefits at Manulife. “If you as a plan sponsor don’t appreciate how many people think of benefits as compensation and you make plan design changes that put more emphasis on insurance, asking members to pay for more budgetable expenses like basic dental or vision care, you may create more challenges than anticipated.”

Five years ago, the 2011 report found 51% of employers placed a great deal of value on their benefit plans. Nearly all (96%) saw the value in connecting employee health to the productivity of the organization in order to demonstrate the importance of benefits.

This article was originally published on SmallBizAdvisor.ca.

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