03/11/2025
Before the pandemic, group benefit plans primarily focused on risk and the unexpected. However, when the pandemic hit, the focus quickly shifted from managing risk to prioritizing employee well-being.
Many plan sponsors enhanced their mental health offerings during this time—either by increasing paramedical coverage or establishing Employee Assistance Programs (EAPs). These changes were often driven by the competitive job market and the need to attract and retain employees. As a result, many of these enhancements remain in place today.
Now, as we navigate an inflated economy, plan sponsors are once again reassessing their group benefit plans to manage rising costs. The projected group benefit cost trend for 2025 is 7.5%, up from 5% in 2024(1). Coupled with political instability, many plan sponsors are feeling financial pressure. Amid this current strain, maintaining stable group benefit plans is crucial to providing employees with a sense of security. So how can plan sponsors be supported—especially those grappling with rising benefit costs?
Here are a few strategies:
✅Plan Design Management: Optimize plan design to balance cost control and employee satisfaction.
✅Education on Plan Design Changes: Help plan sponsors understand when adjustments are necessary and when to hold steady.
✅Goal Setting: Clarify what the plan sponsor aims to achieve—attraction, retention, employee wellness, or a combination of these.
✅Employee Satisfaction Assessment: Gauge how employees feel about the current benefit plan to identify areas for improvement.
✅Alternative Solutions: Explore options like Health Spending Accounts (HSAs) to offer more controlled and predictable spending.
By taking a thoughtful and strategic approach, plan sponsors can maintain the value of their benefit plans while managing costs effectively. Let’s work together to find solutions that support both organizations and their employees.
(1) https://www.benefitscanada.com/benefits/health-benefits/canadian-health-benefits-cost-trend-increasing-to-7-4-in-2025-report/
