In part one of this blog series, we identified common gaps in current healthcare services. These gaps can be addressed using a combination of employer, association, or individual plans working together with basic provincial or territorial medical plans.
For many Canadians, this coverage will be enough throughout the course of their lives.
But what happens when there are more serious conditions for which basic levels of coverage fall short?
What happens if an employee or family member experiences chronic or disabling conditions that may render someone incapable of working for long periods of time? Or require ongoing care for an indefinite period?
Without additional layers of coverage, a person may find themselves in a position where they need to tap into retirement savings, home or business equity, or simply take on more debt.
However, there is good news – employers and individuals can take additional steps and add layers of coverage that preserve their other assets before the worst-case scenario happens.
Employees Are Increasingly At-Risk for Debilitating Conditions
Let’s take a look at where some of the most serious risks lie when it comes to potential long-term disabling conditions:1. Disability – Losing the ability to earn an income due to disability is one of the most catastrophic events that can happen in a person’s lifetime. The Canadian Institute of Actuaries reports that one in four people will be disabled at least once before they reach age 65.
The average length of a disability, should it last over a 90 day period, is 5.75 years. Based on all new claims paid out by Great-West Life disability insurance, 50.6% of claims were a result of musculoskeletal injuries (fractures, dislocations, sprains, etc.)
However, there continues to be rising incidences of non-injury related conditions that keep employees away for longer durations – cancer treatment can have debilitating effects, and nervous disorders such as anxiety and depression now keep employees away for long periods of time.
Recovery for non-injury related ailments is also not quite as black-and-white, and symptoms of previous ailments can resurface after lengthy absences.
2. Critical Illness – Heart attack, Cancer, and Stroke. There are many other critical conditions – far too many too list, sadly – but these are the big three and comprise a significant majority of critical health problems in Canada.
And the numbers are staggering - the numerous reports and statistics provided by the Heart and Stroke Foundation and the Canadian Cancer Society show the significant impact these conditions have on Canadians.
The good news is that advances in modern day medicine ensure that more people are surviving critical illnesses than ever before. But at what cost? Treatment and the recovery process can happen over long periods of time, and is very expensive.
This situation is stressful, not only for the person receiving treatment, but also their families.3. Long-term care – A loss of functional independence can have a severe impact for individuals and their families, even if the condition is only temporary or short-term. The consequences of long-term or permanent disabling conditions are even more drastic.
What Can Employers Do to Help?
This Globe and Mail article opens with an unsurprising but reasonable statement, that “most Canadians would rather not spend time thinking about the possibility of a serious illness or accident, and what it might do to their lives.”
However, avoidance cannot be a solution for serious matters such as disability and critical illnesses - especially considering the incidence rates. Employers who wish to assist employees have a number of tools that can help prepare them and provide them with the help they need.
These include disability management programs, critical illness programs, and long term care coverage.
Disability Management Programs
Managing a program is more than merely including long-term disability coverage in your overall employee benefits offering. Disability coverage is often undervalued by employees because the benefits are not as tangible or immediate as something like dental or vision care, or massage therapy.
However, employees should understand the real impact of losing one’s ability to earn an income because of a disability.
Here are some steps employers can take:
- Help employees understand the coverage they have.
- Help prevent employees from getting injured in the first place, especially on the job.
- If an employee does become disabled, have a plan in place to help limit the time away from work. Also provide a support network to help them return, and work with them.
Long-Term Disability Plan Design
Basic group disability coverage does have limitations, but as an employer you do have some degree of customization to help maximize the program for your organization.
- Identify key employees that are integral to the viability of your company. They may require a more customized solution that benefits both company and individual alike.
- Separate employees into different categories or tiers based on job description or role, and determine if different classes of employees have a need for differing levels of coverage.
- Review and identify parts of your existing program that are meeting expectations or fall short - are there benefit shortfalls because of plan maximums that discriminate against higher salary employees? Are waiting periods to file a claim too long? Are benefit duration periods long enough? What can be done as company, or by working together with the individual, to address any additional gaps that may exist?
Critical Illness Programs
Like disability, providing coverage for critical illness is more than just selecting a box and adding it to your benefit plan.
Unlike disability, however, one could say that critical illness coverage is very much appreciated and understood by plan members.This is because most, if not all, employees will have firsthand experience or know of somebody that has cancer or suffered a heart-attack or stroke.
Actions employers can take:
- Help employees understand the coverage they have, and what qualifies as a critical condition to receive coverage.
- Create an environment that focuses on prevention and good health. Common examples include providing wellness programs, health incentives, gym memberships, fitness trackers, and nutrition lessons.
Critical Illness Plan Design
Under a group plan, the cost of coverage is fairly reasonable as benefit amounts tend to be on the smaller end of the spectrum ($10,000 is quite common).
If employees are interested in more coverage, or coverage that is portable and will be kept even after they leave the company, let them know they have options for individual coverage (the same is true for disability).
Long-Term Care Coverage
Some publicly funded long-term care assistance is available through provincial and territorial plans.
A common scenario would be community health nurses making in-home visits to new mothers, once they are discharged from the hospital. This service would generally be covered by an extended health plan, but additional expenses like meals and laundry would not.
Some individual disability policies contain a unique feature that allow the insured to convert their policy into long-term care coverage at a later date.
This provides the best of both worlds – it protects the employee’s ability to earn an income throughout the career years, and it can also provide an allowance for long-term care (either through a care facility or through home care) if needed once elderly.
This provision is something that an employer can consider if they are looking to complement or enhance basic group coverage with an individual plan for specific employees.
If an employee has a family member in need of long-term care, it is important to work with them during a very difficult time. A paid or unpaid leave of absence may be appropriate depending on the circumstances, as would financial aid in the form of pay advances or loans.
Choice is often balanced with costs - what you want to do for your employees is not always what you can do, unfortunately. However, for employers there are options.
You can provide basic coverage through a benefit plan. You can provide enhanced individual options for all or a select group of employees based on their role and importance to the company. You can provide education to help your employees understand and appreciate the benefits they are receiving.
It can’t be stressed enough - education is of paramount importance, especially when it comes to preventing disabilities and critical conditions. Helping your employees achieve a balanced and healthy lifestyle, while providing coverage in the event of a serious condition, benefits both company and the employees in the end.
Employers see greater employee loyalty and retention, and employees are happier and more productive, knowing they are supported and looked after.