How to Stay Competitive with Employee Benefits That Millennials Want
By Simply Benefits Marketing
July 8, 2020
It’s never been more difficult to attract and retain talent. With a new generation of employees entering the workforce, organizations across Canada are competing to hire and keep their top employees. How are businesses staying competitive? It’s simple. Offering better, more accessible healthcare. This includes anything from offering spending accounts, to digital benefits. We have broken it down to show you the top five proven ways to expand your benefit offerings and stay competitive with the workforce of this generation.
Top 5 Ways to Make Your Benefits Competitive
1. Choose the Right Health Benefits Plan
Companies are finding that attracting and retaining staff is becoming more difficult over the years, around 40% more difficult to be exact. Because of this, companies say that the main purpose of their health benefit plan is to support employee productivity and attraction and retention. From an employee’s perspective, 71% agree that the health benefit plan is a strong incentive for them to stay with their employer.
Another result showed that 86% of employers agree that their health benefit plan is an important factor when deciding on a job offer. This tells us that one of the best things you can do to stand out as an Employer is to promote employee health and well-being by offering a comprehensive health benefits plan. This doesn’t have to be expensive, but including drug, healthcare, and dental coverage will help you land the best employees.
There’s been a significant increase in the use of health apps by employees. Over 53% of employees with a health plan used at least one digital device or mobile app for personal health benefits in the past year. These apps include fitness tracking devices, exercise reminders, and health assessment tools. Younger employees between the ages of 18 to 32 were 70% more likely to use an app than members over the age of 55, making digital health a great way to attract young talent.
These results open the door for digital integration of other tools like benefit management and claim submission because of the increase in digital use over the past year. It’s likely that increased control of health benefits through a digital platform would also increase personal health and satisfaction.
Spending accounts include Health Spending Accounts (HSAs) and taxable Lifestyle Spending Accounts (LSAs) and are equally popular among employers and employees as they provide employees with the flexibility to submit health expenses that are not covered in traditional plans or enable members to top-off claims not fully reimbursed due to plan limits and reasonable and customary expenses.
The great thing about spending accounts is that any sized organization can provide them; however, results show that employers with 500 or more employees are more likely to offer more flexible options in their plan than employers with fewer than 50 employees. This may change in the future, with results showing that 43% of smaller employers anticipate that HSAs will play a significant role over the next five years.
The success rate for HSAs among employees is very high with 93% of employees saying they like having an HSA and 82% of employees saying they would like to have an HSA. It’s also worth noting that 94% of employees that have an HSA did use at least some of it in 2019. When it comes to wellness accounts or LSAs, 35% of employers offer a wellness account which is almost double up from 2017.
HSAs and flex accounts are a win-win for value and cost-effectiveness among employers and employees and will likely keep growing in the future especially when paired with a digital benefit management software that allows for tracking and quick claim submission.
4. Design Plan with Out-of-Pocket Maximums vs Drug Maximums
Drugs make up the majority of health claim costs and are a large and important part of the health benefits world. Over 53% of employees take at least one medication on a regular basis. That number boosts to 70% among employees with a chronic condition.
Modern drug coverage is getting complicated because of the increasing costs of new specialty and biologic drugs. To combat these costs, employers introduce drug plan maximums which tend to be misunderstood by employees. The survey found that a quarter of employees are unsure if their drug plan even has a maximum. The average annual coverage maximum among drug plans currently sits at $9,900, however more than half of drug plans have an annual coverage maximum of less than $2,500.
Instead of drug plan maximums, employers should have an out-of-pocket maximum which means that after employees pay a specified maximum out-of-pocket, the employer will then begin to pay 100% of the healthcare costs. This method makes it more attractive for employees who have chronic conditions or utilize their healthcare more frequently. This option will increase an employer's monthly premium; however, it's a valuable option if hiring and retaining top talent is essential.
5. Listen to What Employees Ask For
It’s important to be aware of which benefits are sought after and how you can provide them. According to Sanofi’s 2020 Healthcare survey, these are the top 10 benefits employees would like in addition to their traditional benefits plan:
Immunizations for infectious diseases - these can be easily quoted and added to most any plan
Fitness classes / Gym Memberships - expenses can be covered through a Lifestyle Spending Account
Health risk screenings with healthcare professionals - these expenses can be covered through a health spending account or some Employee and Family Assistance Programs.
24-hour virtual care - this can be easily quoted and added to most any plan. Simply Benefits partners with Maple for virtual care.
Genetic testing to determine risk for certain diseases - expenses can be covered through a Lifestyle Spending Account
Genetic testing to determine which drugs would likely work best - expenses can be covered through a Lifestyle Spending Account
Personal fitness trainer - expenses can be covered through a Lifestyle Spending Account
Fitness tracking device - expenses can be covered through a Lifestyle Spending Account
Pet Insurance - can often be provided to employees as a Voluntary Benefit (aka Optional Benefits).
Personal financial advisory services - are often provided as part of an Employee and Family Assistance Program or employees can submit these expenses through a Lifestyle Spending Account.
When looking to the future, 61% of employers agree that they have a specific objective for their health benefit plan in the coming year. However these objectives are likely to reflect cost-effectiveness and are purely strategic.
As you notice, many of these solutions can be provided with a spending account.
With digital technology and spending account usage high over the last year, it leaves a huge opportunity for scaling into health benefits management. The Simply Benefits platform is 100% digital and allows employers to customize their plans with multiple flex options including HSAs and LSAs as well as a digital drug card. Our platform also has a usage tracker for employees to view their usage and coverage so they can get the absolute most out of their plan.
Employer Looking for Digital Benefits for Your Workforce?
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Sanofi’s 2020 Healthcare survey provides great insight into employer strategy, benefit trends, and gaps in health benefit knowledge. This year’s survey will help us focus on what’s important for the future of employee benefits. Download the full report at www.sanofi.ca.
Simply Benefits is Canada's newest Third Party Payor (TPP) that provides Employee Health Benefits 100% digitally through our Canadian Advisor partners. Our all-in-one digital solution provides three portals that enableBenefits Advisorsto digitally manage all client plans online,Employersto efficiently administer employee coverage, andEmployeesto view, update and use their benefits 24/7 via desktop or smartphone app.
We helpENGAGEEmployees Anytime, Anywhere,SIMPLIFYthe Benefits Experience, andEVOLVEan Advisors’ Benefits Business.