Employers are constantly having to adapt their strategies in promoting staff health and wellbeing. Sam Barrett reports on some of the changes – and challenges – of 2015
With the economy continuing to pick up, it’s been a busy year for the health and wellbeing market as organisations invest in their key asset: their staff. And, while this focus has led to new developments, 2016 is likely to bring even greater benefits to organisations.
For Beate O’Neil, head of wellness consulting at Punter Southall Health & Protection Consulting, 2015 represented a turning point. “We’re finally getting to the stage where employers can see the value of health and wellbeing and it’s becoming the norm in the workplace,” she says. “Employees are beginning to expect it, too. It’s very encouraging.”
Technology has been something of a driving force behind many of the product developments in 2015, with the launch of virtual GP services a good example of this. Among the insurers offering these services are Aviva, Bupa and Axa PPP healthcare, with many of the cash plan providers, including Simplyhealth, Westfield Health and Health Shield, also providing access to virtual GPs.
It’s easy to see why. Getting to see a doctor can take days and lead to considerable time off, especially where an employee’s GP isn’t near to the workplace.
The potential for disruption was highlighted in a poll among GPs by Pulse magazine. Conducted in May, this found the average patient waited 10 days for an appointment and, by next summer, those surveyed expect this figure to have risen to two weeks.
Providing quick and convenient access through these services is clearly a winner. Typically an employee can get an appointment within a couple of hours and any prescription can be delivered to them or via a local pharmacy.
Given the benefi ts, Carl Chapman, head of workplace health at Barnett Waddingham, expects these services will become standard over the course of 2016.
“These services are great for both employers and employees. In up to 80% of consultations there’s no need for the patient to be physically there,” he says.
“Most of the insurers have either launched a service already or are in talks with a provider to introduce one. I also expect that many employers will choose to buy directly if they don’t have a service bundled up with their health insurance.”
Cutting out the GP
Virtual GPs may be all the rage but over the past year several insurers have taken steps to cut them out of medical insurance altogether.
Self-referral pathways, which were first introduced by Cigna back in 2008 for physiotherapy treatment, are now available from Aviva, Axa PPP healthcare and Bupa.
With these, rather than visit the GP for a referral to a consultant, the employee calls the insurer directly and is triaged to the most appropriate treatment.
So far, the insurers have focused primarily on musculoskeletal and mental health conditions, although Aviva also offers it for consultations on cataracts.
Taking this approach has a number of benefits. As well as making it easier for employees to access treatment, cutting out the GP means they receive treatment faster, leading to a speedier recovery and lower costs. Furthermore, and especially with mental health conditions, it can be easier for an employee to talk to an anonymous person by phone than to see their family doctor.
The results are impressive, too. For example, Aviva found that only 25% of musculoskeletal claims managed through its BacktoBetter, which was launched in 2013, required further investigations by a specialist, compared with 60% of unmanaged musculoskeletal claims. In addition, the average cost of this type of claim was 15% lower, with some as much as 30% lower.
Chapman believes it’s an approach that will continue to gain momentum. “As long as employees are able to access the right treatment for the right conditions then it’s a positive move,” he explains. “There does need to be some caution though, as without GP involvement, there’s a risk of self-diagnosis.”
Another trend that has taken off in 2015 is wearable technology. Market intelligence company IDC suggests that 72.1 million of these devices will have been shipped by the end of the year, up from 26.4 million in 2014. It predicts that by 2019 demand will have reached 155.7 million a year.
O’Neil isn’t surprised by these figures. “Wearable technology is really trendy in the workplace and we’re seeing more and more employers offering these to staff, either funding them completely or partially,” she says. “Being able to track health data such as your sleep or the number of steps you take in a day can encourage people to become healthier.”
These devices aren’t a panacea though, and some employers are finding that, unless initiatives are introduced regularly, the novelty can wear off quite quickly. Chris Evans, senior consultant at Buck Consultants, recommends gamification, such as challenges to cover the furthest distance, to maintain momentum.
He also believes that, although today’s devices are fairly limited in what they can do, over the next few years they’ll become increasingly sophisticated and a much more powerful workplace health tool.
“The developers are expanding the data these devices will collect, including looking at speech analysis to determine whether someone’s stressed,” he explains.
“Further forward we’ll be able to analyse employee data to show us when and where they’re most productive. This might seem a bit Big Brother but it will enable employers to create work patterns that ensure employees are working at their optimum level. This is mutually beneficial.”
Shifting the stigmas
Mental health also climbed up the health and wellbeing agenda in 2015.
“There’s still stigma around, but over the past 12 months I’ve seen a real drive and energy to address this,” says Evans. “Employers are more confident about talking about mental health in the workplace.”
This has resulted in an increased appetite for line manager training, which can help them identify early warning signs of a problem. But, while this is a positive step, O’Neil says employers should look to be proactive rather than reactive. “It’s too late once someone’s suffering a mental health problem. Employers need to build in strategies to help staff stay mentally fit.”
In the light of this, one area where she expects more activity in 2016 is financial education. “As much as 30% of stress-related absence has a finance-related component,” she explains. “By providing information in this area, employers can help to prevent staff getting into this position.”
She recommends offering financial seminars and podcasts linked to different life stages to help employees deal with the money issues they’re facing. These could run from a graduate money management session through to a focus on retirement finances.
Another area that is likely to become part of an employer’s mental health support package is eldercare. Raman Sankaran, sales director at Simplyhealth, says that a growing number of people are finding themselves under increased pressure to look after parents or grandparents.
“If a relative suddenly needs care it can be difficult to work out what to do,” he says. “Health and social care aren’t very integrated and trying to find your way through the maze can be incredibly difficult. Helping employees deal with this stress will be important.”
Tackling this takes a variety of different approaches. Flexible working is key but access to support through employee assistance programmes can also make it easier to cope with this stressful situation.
While employers have been busy improving employee health and wellbeing, the government also stepped in this year with the launch of its Fit for Work service. This provides access to work-related health advice and a referral to an occupational health professional for anyone who has been, or is likely to be, off work for four weeks or more.
This package aims to help keep employees with health conditions in work while also reducing long-term absence by working with employees on return-to-work plans.
O’Neil says that, with employers only given the opportunity to refer staff members to the service in September, it’s too early to judge how successful it will be.
“It’s a very positive change,” she adds. “A lot of employers dismissed it last year but I think it will deliver real benefits.”
The way in which Fit for Work is used over the next few years could also shape future government strategies on workplace health. Stuart Scullion, chairman of the Association of Medical Insurers and Intermediaries, explains: “It’s offering a carrot at the moment but, if this isn’t effective enough, I expect we’ll see it wield the legislative stick in a few years’ time to ensure employers take proactive steps to improve staff health.”
But it wasn’t all positive for workplace health and wellbeing in 2015 with the July Budget containing an unpleasant surprise in the form of an increase in insurance premium tax (IPT). This went up from 6% to 9.5% on 1 November, ratcheting up the cost of both medical insurance and cash plans.
Although their low premiums mean cash plans should be relatively unaffected by the tax hike, Barnett Waddingham’s Chapman believes it could be the straw that breaks the camel’s back for some employers offering medical insurance.
“On its own it’s a small issue but when taken alongside the chunky premium increases you see on medical insurance, it will lead to some employers cancelling cover,” he says.
And while some regard the increase in tax as the first of several, others are more optimistic. Charlie MacEwan, corporate communications director at WPA, believes it was a bit of a knee-jerk reaction.
“It’s not joined-up thinking by the government to increase IPT on medical insurance when it’s trying to encourage employers to look after the health of their workforces. I can see IPT increasing again but I can also see it being frozen for health insurances in line with some of the other European Union countries.”
While the IPT increase may be bad news for medical insurance, another product, the healthcare trust, is benefiting.
As these aren’t insurance contracts, they don’t attract IPT, making them considerably more attractive following the rate rise. They’re not suitable for everyone, though. It is essentially self-insurance, so an organisation needs a relatively stable claims history to avoid any financial hiccups. As a result, many providers require at least 500 employees, although some will drop as low as 100.
Importantly, with IPT on the up, it’s likely to create more innovation around trusts in 2016. For example, MacEwan points to his Corporate Deductible product as a potential area for growth. This is a variation on a full trust but gives a little more security, as the insurer picks up any claims that exceed the notional claims fund.
This year, there’s been plenty of movement in the market. On the insurer side, Axa PPP healthcare picked up the Permanent Health Company (PHC) and Simplyhealth’s medical insurance book, while in the adviser market the consolidation trend continued, with Marsh acquiring Jelf, Punter Southall buying Private Health Partnership (PHP) and Willis swooping on PMI Health Group.
Amii’s Scullion, who was himself involved in one of these transactions, shifting from managing director at PHP to commercial director at Punter Southall, believes that size has become increasingly important.
“It’s tough for a smaller insurer to compete as they need size to be able to negotiate better deals on treatment,” he says. “We still have the likes of April, Freedom and PHC, which is operating independently to Axa, but I am concerned the market will become more commoditised and choice will be reduced for employers.”
However, periods of consolidation are often followed by more entrepreneurism. “Not everyone wants to work in a large company so you often see more start-ups following consolidation,” he says.
And with so much change taking place in workplace health and wellbeing, there’s certainly plenty of opportunity for businesses of all sizes in this market.