Employee benefits: too costly for employers

Conducted by the Conference Board of Canada among 2,178 human resources managers of medium and large organizations across the company, a survey on employee benefit programs has resulted in a comparative study of employee benefits in 2015. It reveals in particular that the high cost of benefits paid to employees is leading organizations to rethink their health offering.


Among the study’s salient facts we learn that a large majority of employers offer their full-time employees a comprehensive benefit plan. 92% cover ophthalmological expenses, 96% offer private or semi-private rooms in hospital, 99% have coverage for care received abroad. 99% reimburse the cost of paramedical services (massage therapy, chiropractic, physiotherapy). 98% grant dental insurance, 91% accidental death and dismemberment insurance and 99% long term disability insurance. And the proportion of employers who offer insurance against serious diseases has risen from 26% to 35% in 3 years.


Particularly high costs

The cost of services paid to employees has reached an average of $8,330 per full-time equivalent. The prevalence of chronic diseases and the increase in cases of mental disorders are behind the historically high costs, according to the Conference Board of Canada researchers. Furthermore, 52% of organizations have noted an average 6.2% increase in the costs of employee benefits between 2013 and 2014.


Solutions to control them

While the benefits are valued by employees, organizations are now confronted with the necessity of reducing health costs. To do this, several types of solutions are put in place. Companies choose to replace prescription drugs with generics or to exclude certain drugs, increase their employees’ share of premiums or limit the benefits for retirees. The number of organizations that have chosen the latter solution has doubled between 2012 and 2015. Finally, certain businesses are relying on developing physical and mental health promotion programs and programs for early evaluation and intervention, a solution strongly recommended by the Conference Board of Canada to better manage costs.


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