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Looking Back on Group Insurance Trends and Predictions for 2021

By: Benefits by Design | Tuesday November 9, 2021

In the latter half of 2020, we made some bold predictions for the group insurance trends going into 2021. At the time, we were amid a new and scary global pandemic, with lockdowns and social distancing, and a worsening mental health crisis in Canada. 

Now, with 2021 wrapping up, we’re looking back at some of the trends and predictions and figuring out what we got right, and maybe where we missed the mark.

#1. COVID-19 is, unfortunately, here to stay  

It is unfortunate indeed that we were bang on when we predicted this one. COVID-19 still dominated Canadians’ lives in 2021 with social distancing, work from home, and lockdowns. The long-term impacts on working Canadians and their employers remains to be seen (and COVID-19 isn’t gone yet), but there is hope for a return to normalcy heading into 2022. 

COVID-19 is one of those things with a ripple effect through all of 2021 (and, likely, beyond), with impacts on mental health, the job market, group insurance renewals, work from home, and more.

Prediction Accuracy Meter: 100%

#2. Adoption of telehealth and telemedicine will continue 

The telehealth and telemedicine space were changing rapidly heading into 2021 as mergers, acquisitions, and partnerships were reported. Insurers had been announcing new telehealth options for plan members left right and centre, like Green Shield Canada (GSC) and Mapleor GSC and Inkblot, and it was thought that the beginnings of major mergers and acquisitions were on the horizon in an overly saturated market. 

This sort of happened — with a few new acquisitions and partnerships — but to a lesser extent than we thought, so we’re giving ourselves half marks for this one. 

Prediction Accuracy Meter: 50%

#3. Canadians’ mental health will continue to be challenged 

Sometimes, it sucks to be right — and this is one of those times. Canadians’ mental health during the pandemic has worsened in an environment where overall mental health was already on the decline. Youth aged 15-24 have been the most negatively impacted, and there are few indications that Canadians’ mental health will improve even after COVID-19 is in the rearview mirror. 

Many employers have responded to this rise in mental health challenges by building mental health support and services into their benefits offerings, such as Employee Assistance Programs (EAP)s and expanding Psychologist benefits through Extended Health Care (EHC)

Prediction Accuracy Meter: 90%

#4. COVID-19 will affect renewals 

Out of all of the predictions for group insurance trends in 2021, many of COVID-19’s effects on renewals were predictable. Here’s a few notable trends and insights our Underwriting team shared: 

  • Widespread drops in claims in 2020 due to COVID-related practitioner closures has led to an increase in claims in 2021 as employees play “catch up” on services and medications they could not access the year before. 
  • Cost of services have increased as practitioners must allow idle time between patients for sanitizing, as well as pay for additional Personal Protective Equipment (PPE), which contributes to higher claims costs. 
  • Specific industries experienced many layoffs due to COVID-19, and in a lot of cases new employees were hired when the employers needed to expand their staff again, resulting in high turnover, greater claims fluctuation and changes in pooled rates.

Of course, these aren’t all of the effects, and some may not even reveal themselves until much later, but there’s enough here that we’ll be keeping an eye on things and digging a bit deeper when it comes to renewals.

Prediction Accuracy Meter: 70%

#5. Increased claims cost due to Personal Protective Equipment (PPE) charges 

While it is true that the cost of services are increasing, the connection between these increases and Personal Protective Equipment (PPE) charges is not clearly established.  

Many other factors are at play in driving these increases — such as inflation — which may continue moving into 2022 (more on that in a future blog post). PPE charges have certainly made their way into many practitioners’ bills, either as a direct charge, or as an increase in the cost of services to accommodate PPE cost. However, as a group insurance trends in 2021, it is not as impactful as we first predicted and we can’t be sure the increases are attributed solely to PPE. 

Prediction Accuracy Meter: 60%

#6. Work from home and the gig economy will become the norm 

Canadians transitioned to work-from-home in droves in 2020 to limit the spread of COVID-19 and maintain social distancing. Coupled with the emerging gig economy, 2021 was poised to create a new kind of workplace, where working-from-home or for yourself (a “gig”) became the norm. 

While many workplaces have unveiled permanent work-from-home options, like Shopify and Dropbox, there remains a disconnect between employers and employees. According to a recent study conducted by the Best Practice Institute, 83% of CEOs want employees to return to the office, while only 10% of employees wish the same. 

All in all, progress has been made, but it remains to be seen whether companies truly embrace work-from-home policies once COVID-19 is no longer make them a necessity.

Prediction Accuracy Meter: 50%

#7. Long healthcare wait times will continue to be an issue 

With COVID-19 pushing hospitals to the brink, many elective surgeries were postponed and re-scheduled in 2020 and 2021. Now, healthcare systems are dealing with the backlog of appointments and wait times are increasing. Canada’s healthcare wait times were already high before the pandemic, but have since worsened.

We already know that waiting for treatment can be harmful, turning curable diseases into chronic conditions. The long-term impacts on the healthcare system aren’t difficult to predict — longer wait times, poorer health outcomes, negative impacts on mental health, increased or prolonged pain for patients — but the how badly remains to be seen.

Prediction Accuracy Meter: 90%

#8. Insurers will bring more diversity and inclusivity to benefits 

In 2020, we updated our processes and language to be more inclusive, adding an ‘Undisclosed’ option for Gender. Though it may be a small change, to some Canadians, it makes all the difference in the world. 

Though Insurers will undoubtedly need to be looking at their processes and likely already have diversity in mind, we didn’t see many updates in the industry on this topic in 2021, so we were a little ahead of the game.

Prediction Accuracy Meter: 30%

#9. Defined contribution plans will rise in popularity 

Defined contribution plans like Health Care Spending Accounts (HCSA)s are certainly becoming more popular, but it’ll take more than a year for these sorts of trends to become notable. That said, we’ve noticed a small uptick in our own HCSA numbers, so we’re giving ourselves some credit for this prediction. 

Prediction Accuracy Meter: 50%

#10. Biosimilars will continue to become mandated in provinces 

In January, 2021, Alberta joined British Columbia in the decision to mandate the switch to biosimilars, followed by New Brunswick in April 2021. On May 18, 2021, the Government of Quebec announced its intention to implement a biosimilar switching policy and have provided some additional details since that announcement. Biosimilars are not the new kid on the block anymore, as Green Shield Canada (GSC) puts it, and the evidence for the effectiveness of biosimilars is becoming clearer. This is one of those 2021 group insurance trends that will likely crop up as notable for many years to come.

Prediction Accuracy Meter: 80%

#11. Cybersecurity and data storage will change 

With COVID-19 sending many Canadians home for work, employers had to re-think their data security and storage options in 2021. Although this trend is still revealing itself (these issues are complex and won’t change overnight), the beginnings of these conversations are happening, so we’re giving ourselves half marks for getting the what but not the when.

Prediction Accuracy Meter: 50%

#12. Renewed focus on reviewing and updating benefits plans 

We saw many employers reexamine their benefits offerings in 2021 amidst the pandemic. Some shifted priorities to maximize spending, some expanded their offerings to include mental health support through EAPs, all to ensure employees were properly taken care of. We expect this to be a continued focus moving forward! 

Prediction Accuracy Meter: 70%