ways for the employer to deal with
the rising cost of employee health benefits
are tough, employers are often looking for a way to reduce expenses
as opposed to add to them. When it comes to benefits, it’s often
tough to take away something that employees have without affecting morale
or loyalty. This has become increasingly challenging given that health
benefit premiums have been increasing as a result of rising health care
costs at a rate of 10% to 15%.
Here are 3 ways
to help combat the rising cost of health benefits:
1. More voluntary benefits.
Benefits Canada reported that “Voluntary benefits could be tomorrow’s
trend.” Voluntary benefits are typically paid 100% by the employee
but more cost effective because of the buying power of a group.
plans already include some voluntary components, such as optional
coverage for life insurance, accidental death and dismemberment, critical
illness, even certain retirement products.
in Benefits Canada stats that the newer generation of workers (Gen
Y) might actually prefer more voluntary benefits because they tend
to be more discerning in terms of what benefits their potential employers
are offering them.
move forward, it’s clear that benefits are changing and economies
are changing. More and more people will see benefits as a privilege,
not a right.
2. Control Costs with Group retirement savings
issues is solely about the rising cost of health care costs, one of
the benefits that has a more controlled inflation rate is group retirement
savings. This might include a Group RRSP or a Defined Contribution
plan. In both cases, the future cost of these benefits are not affected
by the rising cost of health care. Instead retirement savings is driven
by wage inflation which is generally lower and more consistent. The
benefit is calculated based on base salary and you are not seeing
base salary increasing by 10% to 15%.
than wages, the cost of a group savings plan can be influenced by
the employer. For example bonuses can be put into a Group RRSP plan
but the employer controls the amount of the bonus.
than a matching program, there is very little cost to the employer
in implementing a group RRSP or event a Defined Contribution pension.
may be tough but there are still things employers
can do to reward employees without breaking the bank.
Shop the market
independent broker, we can shop the market to have reputable insurance
providers quote on your group benefits. Most carriers generally offer
the same types of coverage.
secure employee's are more productive"
Serving the Saint John, Quispamsis, Grand Bay-Westfield, McAdam,
St. Stephen and Fredericton, New Brunswick
Group Benefits Call 506 214
Saint John, New Brunswick