How Millennials are Redefining Benefit Plans
Canada’s labour force is changing and today’s health benefits plans are under pressure to change as well. While the Canadian work force consists of a fairly equal breakdown of employees of all ages, the scales have begun to tip towards the younger demographic. Those millennials that were brought in a few years ago to make sure that Adobe Acrobat was up to date, are now playing bigger roles in organizations in greater numbers. So much so that Statistics Canada recently determined that 35% of today’s active work force consists of millennials (those born early 1980’s to early 2000’s); 31% Generation X (born mid 1960’s to early 1980’s); and 31% and shrinking baby boomers (prior to Generation X). Furthermore, it is expected that the overall percentage of millennials will nearly double in the next ten years. Due to this passing of the torch, plan sponsors are facing new challenges to ensure that they are meeting the needs of their employees today and into the future.
What does this mean for plan design?
Millennials are the most healthy group of individuals in the workplace. This means that they don’t see extensive drug coverage or benefits that focus on long term risk issues as a huge priority. In response to this, younger employees have focused on maximizing the value of other elements of their plans, which has put pressure on the traditional model. One value-add which millennials seem to swoon over, is paramedical. In 2015, 68% of massage therapy claims were submitted by those between the age of 18 and 34. In the past, many plan sponsors required a doctor’s note for members seeking paramedical services. This has become more of an inconvenience than anything else however, especially considering the sheer amount of studies that have been released supporting the many intangible benefits of massage therapy that are difficult for a physician to assess.
Employers can embrace the needs and wants of their more youthful group of employees and look towards innovative forms of plan design in response to the changing landscape. Larger organizations may consider installing flexible plans where members can choose the benefits they want from a cafeteria-style menu. These programs strongly appeal to millennials but aren’t entirely risk-free because they can quickly go into deficit if not managed properly.
What is it that Millennials truly value?
When asked what millennials valued most in the workplace, training and development was listed as number one, followed by flexible work hours, comprehensive benefits and cash bonuses. Millennials are therefore looking for meaningful work that serves their professional development, a less rigid schedule that respects their ability to accomplish tasks on time, and a positive workplace culture which rewards their contributions and demonstrates an investment in their personal well-being. Millennials also value non-traditional health care which supports mental acuity and preventative care; things that may be better served with the addition of a flexible Health Spending Account.
In closing, it is important for employers to have a conversation with their employees about these values, and by doing so smarter and more cost efficient plans can be developed which are tuned in to the health concerns of all generation. For more information please contact your Silverberg advisor, and we would be happy to assist you.