Employee understanding of benefit plans declining: Survey

One-half expecting access after retirement
|hrreporter.com|Last Updated: 06/29/2012

One-half (51 per cent) of Canadians expect they will continue to have access to their health-care benefits after retirement, which may not necessarily be the case, according to the latest Sanofi Canada Healthcare Survey.

Expectations are especially high among plan members aged 55 and older (69 per cent) and those who work for large companies (67 per cent for companies with 5,000 or more employees). Plan members who work for the government are most likely to expect retirement benefits (72 per cent), while non-unionized (39 per cent) and private sector (37 per cent) employees are the least likely.

Regionally, respondents in Atlantic Canada appear most likely to expect retirement benefits from their employer (60 per cent), while those from Alberta (41 per cent) are least likely, found the survey of 1,757 primary holders of group health benefit plans and 125 benefit plan sponsors.

At the same time, a number of respondents are willing to pay out of their own pockets in order to keep employee benefits after they retire. When asked for which services they would personally purchase additional insurance, retirement benefits rank first (54 per cent), ahead of critical illness insurance (36 per cent) and higher-cost medications that may not be covered in their employee health benefit plans (32 per cent).

Employers should educate employees on what happens to health benefits upon retirement, said Pierre Marion of Medavie Blue Cross.

"Right now, employees are not factoring health-care costs into their retirement planning. Many will be in for a surprise when they realize that extended benefits may not be available."

When it comes to their health benefit plans, the depth of employee understanding may be declining, found the survey. Just 13 per cent of employees said they understand their benefits extremely well, down from 19 per cent in 2005. Forty-five per cent believe they understand them very well, down from 53 per cent, and 39 per cent understand them somewhat well, up from 23 per cent.

Fifty-seven per cent of the respondents said they feel they have an obligation to help their employers control the costs of their health benefits. This climbs to 68 per cent among members aged 55 and older. However, among plan sponsors themselves, only 33 per cent believe their employees feel an obligation to help control costs.

If their employers are unable to pay for increased costs for current health benefits, 37 per cent of plan members said they are willing to pay higher premiums in general, followed closely by paying a higher share of costs when they use the service themselves (31 per cent). They are much less willing to give up compensation for benefits, such as their annual pay increase (16 per cent) or bonuses (12 per cent), found Sanofi.

One-third (34 per cent) of employers are definitely not considering cuts to their health benefits while 14 per cent are considering cuts. Among those that are considering cuts, the drug plan is the most likely target, found the survey. However, when plan members are asked which benefits theyd be willing to give up if their employer could not or was unwilling to pay, semi-private hospital coverage (21 per cent) and paramedical services (16 per cent) scored highest.

At the bottom of the list, they put the drug plan (two per cent), along with disability (short-term three per cent; long-term two per cent) and dental coverage (basic three per cent; major five per cent).

Almost all Canadians (92 per cent) surveyed indicated they would participate in on-site health risk screenings for conditions such as heart disease, diabetes, stress or depression. Among the eight per cent who are not likely to participate, the most common reasons fall into two general categories, said Sanofi. One reflects the perception they are already doing what they should (such as seeing their physician regularly (21 per cent), theyre healthy (five per cent)). The second points to concerns over confidentiality (lack of privacy 15 per cent; dont want employer to know seven per cent). Seventeen per cent said they are just not interested.

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