Benefits plans come in a variety of shapes and sized. Group health benefits are important to provide support to employees in maintaining health and wellness and also to provide security to employees in the event of serious illness or injury (e.g., life insurance, disability insurance, etc.).
Group health benefit plans can include a variety of different options, insurance coverage options and functionality. They can also vary significantly in cost. They can include:
- Prescription drugs
- Extended Health
- Dental coverage
- Short-term & Long-term disability plans
- Paramedical coverage (e.g., massage, physiotherapy)
- Employee Assistance Programs [EAP]
- Vision care benefits
- Life insurance, AD&D, etc.
- Travel insurance
It is recommended that agencies obtain multiple quotes when contemplating group health benefits insurance and/or at renewal periods. Quotes should be detailed and compared line-by-line so the differences in each plan are clearly identified and considered (and relative to what’s currently offered by your plan in the event one is already in place).
Another critical piece before looking at benefit options is knowing your budget. This will assist you in obtaining quotes for plans that may affordable and not result in some fantastic options that are not realistic for your organization or its valued employees.
Retirement Savings and Pension Programs:
For more information regarding Retirement Savings and Pension programs please contact an OPRAH Consultant.
Some Other Considerations
Before instituting group health benefits, an organization should consider how monthly benefit premiums will be paid. Some organizations share the cost of premiums (e.g., employer pays 60% and employees pay 40%). Other organizations pay 100% of the premiums. Again, others might pay the premium but provide for a co-pay on the actual benefits (e.g., prescriptions covered at 80%).
If offering disability coverage (e.g., Long-term Disability (LTD)), it’s often advantages for the employee to pay this portion of the premium. That way if the employee ever needs to access the benefit it can be done on a tax-free basis. This helps offset the fact the employee would be receiving a reduced payment in the case of disability.
A pooled plan effectively means that under a fully pooled underwriting arrangement, the insurance carrier does not review the claims experience of any one particular group (or employer) but instead looks at the experience for their entire block of business (or all organizations that are part of the “pool”). They then determine the premium rates and rate adjustments that are required. If an organization has higher claims in one year, the idea is that the entire block or group will absorb that and that the overall increase or experience rating wouldn’t be as high across the entire block or group. That helps to keep annual adjustments and premiums hopefully lower and risk is absorbed across the entire block or group.
For smaller organizations, especially those who may expect more utilization of benefits and higher claims (specifically disability related claims), may want to consider pooled plan options to mitigate exposure to premium increase that might be higher in a custom plan.
Conversely, a custom plan provides greater flexibility in the options for coverage an employer can select and offer to its employees. They also pay premiums based on their individual group and premium increases will be tied to their own group’s utilization and costs. The risk as pointed out is that one significant or high cost claim (e.g., LTD) in a small employee group could result in a premium increase upon renewal that may not be affordable/sustainable.
Trillium Drug Program
The Trillium Drug Program in Ontario provides coverage for prescription drugs and the premium is based on an applicant’s income. This can be accessed for individuals who qualify where benefits are not provided by the employer and can also be used in some cases to supplement employer benefits that may have maximum benefits that are exceeded by the affected employee.
The ASO sector has worked with OASSIS, an organization offering benefits to not-for-profit organizations of all sizes, including full time, part time, and contract employees. Comprehensive Pooled plans are available for organizations with 1 to 75 employees. Custom plans are for organizations with 25 to 1000 employees. Union and non-union, big or small, OASSIS can assist you and provide a quote as needed.
OASSIS is a not-for-profit and is not a broker and therefore no brokerage fees or commissions are charged, resulting in greater savings.
Compensation is complex!