It’s 11:00 p.m. and you’ve survived another day of back-to-back meetings, endless emails, gridlock traffic, making dinner and getting the kids off to bed. Your head hits the pillow as you turn out the light, but your mind is still at the office, assessing the day’s events and speculating what tomorrow might hold in store. This is an all-too-familiar scenario that many of us encounter routinely.

So, in our 2015 Benefits + Pension Survey, we asked plan sponsors what’s keeping them up at night.

According to the survey results, comprised of responses from mostly Alberta-based organizations, rising costs rank as the No. 1 issue that Western Canadian plan sponsors face. And, in this environment of low oil prices, costs are being scrutinized more than ever.

Benefits considerations for weathering the oil slump

Inevitably, when companies reduce their staff, plans sponsors are more likely to encounter an increase in incidents of absence and disability, which was the second most important issue facing plan sponsors.

This was followed by organizational change, employee engagement and drug costs. Many respondents, especially in the energy sector, are dealing with organizational change and are using the downturn to make their organizations lean, mean and ready for the next oil price rebound.

However, all of this change and uncertainty undoubtedly impacts employee engagement. With very few plan sponsors untouched by high-cost biologic and specialty drugs, plan sponsors need to find new ways to help better manage drug costs without pushing too much of the financial burden back on employees.

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The survey also asked plan sponsors about their employees’ biggest concerns regarding benefits. Plan sponsors confirmed the following as primary issues:

Top 5 employer benefits issues

  1. Rising costs
  2. Absence and disability management
  3. Organizational change
  4. Employee engagement
  5. Drug cost management

Vision care
Inadequate vision care coverage is the top concern of employees, according to responding plan sponsors. While a new pair of prescription glasses can cost in excess of $500, 50% of plan sponsors offer vision care coverage of less than $300 every two years.

Vision care coverage has not kept up with inflation, and the trend in recent years has been to eliminate coverage and have employees rely instead on healthcare spending accounts (HCSAs) for these types of expenses. However, as employees’ perceived value of this benefit may be higher than actual costs, plan sponsors may want to reconsider increasing rather than reducing or eliminating this coverage to improve employee satisfaction.

Read: Employers embracing flexibility

Dental and paramedical
According to plan sponsors, employees are also dissatisfied with coverage levels for dental and paramedical practitioners. Just under half of respondents (44%) cover basic dental at 100% coinsurance, while 42% provide 80% coinsurance. The vast majority (71%) provide major dental coverage at 50% coinsurance and 64% offer orthodontic dental coverage at 50% coinsurance. The issue of inadequacy may have more to do with employees’ out-of-pocket share of major and orthodontic coverage, which for those that need this treatment can be quite expensive. Employee concerns may also be related to the high cost of dental care in Alberta and the absence of a provincial dental fee guide, which often creates a gap between the amount dentists charge and amount insurers reimburse.

Not enough paramedical coverage is another common employee complaint despite the fact that 67% of respondents provide 100% coinsurance for paramedical coverage and 57% cover up to $400 or $500 per specialist annually. For plan sponsors that want to give employees more flexibility, one option is to remove the per-specialty maximum and implement a higher combined maximum for all paramedical practitioners (e.g., $1,500). As most employees use no more than a couple of specialists per year, this provides a bit more coverage for those requiring extended periods of treatment, and an ounce of prevention can be worth a pound of cure.

Top employee benefits issues

  1. Vision care not adequate
  2. Not enough benefits program flexibility
  3. Dental coverage not adequate
  4. Workloads too heavy to take time off

In a world where just about everything is customizable, employees are demanding more flexibility. This year, 61% of respondents indicated offering a plan that includes some flexibility. Eighteen percent provide a full flexible benefits program, where employees are able to choose health and dental coverage levels. However, the most common means of offering employees choice and flexibility is by simply adding a HCSA to a traditional fixed program, as indicated by 43% of respondents. It may be that employees simply value the ability to have choice regardless if they actually exercise flexible options, as some employers implement flex plans only to witness the vast majority of employees opting to maintain coverage levels similar to what they had previously.

Excessive workloads and time off
Not enough paid time off was last on the list of employee concerns. This may be due to a perception that their work demands don’t enable them to use their existing allotment, which is also a top-five concern.
Employees need time off to remain productive and engaged in the long run. Although many employees don’t feel they can afford this time away from work, employers need to encourage employees to use the time off they are given.

Half of the battle in addressing employee perceptions about benefits program shortcomings may be in benchmarking the organization’s program against competitors, and educating employees about how it compares.

So what’s the cure for the benefit plan sponsor’s insomnia? The thought of tackling too many issues at once can be overwhelming. Plan sponsors are more likely to make progress by concentrating on addressing a few high-priority issues at a time, which will help ease those nagging nocturnal thoughts and increase the probability of getting a good night’s sleep.

Kenneth MacDonald is a senior consultant with Morneau Shepell in Calgary. These are the views of the author and not necessarily those of Benefits Canada.
Copyright © 2021 Transcontinental Media G.P. Originally published on

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