Extended health and dental benefits are the core of any employee benefits plan. They’re the most well-known of all the employee benefits, and they’re the most frequently used. That being said, it’s important to have a solid understanding of these benefits and how they can support your business.
Extended health employee benefits typically have three main components.
- Prescription Drugs
For most people, the first thing that comes to mind when they think of employee benefits is prescription drug coverage. It really is a foundation benefit of most plans. Prescription drugs play an integral role in treating health conditions, curing the infection and providing pain relief. They are without a doubt the highest frequency claims made on a benefit plan.
There are several different types of prescription drugs. Here we’re referring to traditional prescription drugs. These drugs were created to treat general health and chronic conditions. Within traditional prescription drugs, there are brand-name drugs and generic drugs. Brand-name drugs are under patent and only the company that developed the drug can produce and sell it. They tend to be priced higher, as the developer is trying to recoup research and development costs associated with creating the drug. After the patent on a brand-name drug expires, a generic drug can be created. Generic drugs are copies of brand-name drugs. Colors and fillers of these drugs may differ, but the active ingredients must be the same. They can be used interchangeably with their brand-name counterparts.
In contrast to drugs used to treat general health or chronic conditions, there is another category of drugs that targets complex and rare health conditions. These drugs are called specialty drugs and they are often created using living cells. As a result, when a specialty drug comes off patent, it is not possible to create an exact replica of the drug as a generic. In many cases a “bio-similar” drug is created, but it is not directly interchangeable with the specialty drug.
- Paramedical Services
Another well-known employee benefit is coverage for paramedical services. Paramedical services are not usually part of the public healthcare system. They tend to complement and support medical services from primary care providers (like doctors). Examples of paramedical providers include massage therapists, physiotherapists, podiatrists, speech therapists, dieticians and audiologists. Generally, these practitioners must be licensed or certified by a professional body in order to be covered under a benefits plan.
Eye exams and corrective eye wear are the usual components of this benefit. Protective eye wear means glasses, contact lenses and sometimes laser eye surgery. Some plans also include coverage for prescription and non-prescription sunglasses.
The dental side of employee benefits coverage usually includes three components as well.
Basic dental coverage usually includes preventative services (such as dental exams) as well as procedures to maintain good oral health. Common examples include x-rays, fillings and cleaning. This coverage usually allows for at least one visit to the dentist per year.
As its name implies, coverage for major dental services refers to more extensive dental treatments. Often this includes bridges, crowns and other means of replacing missing or damaged teeth.
Orthodontic coverage is less common than basic and major coverage. Orthodontics refers to treatments meant to change the position of teeth in the mouth. This is done to straighten teeth, change a person’s bite and generally correct teeth that are misaligned. This is usually done with braces, retainers and other dental devices.
Funding and Cost Control
One the biggest concerns for employers who are considering sponsoring an employee benefits plan is cost. How much will it cost? Will those costs rise? And where am I going to get the money?
Funding coverage for health and dental benefits does not ALL have to come from the employer. Cost sharing between employee and employer is very common. The percentage covered by an employee can be adjusted based on business goals and budget. Common cost sharing arrangements include 80/20 and 70/30, but anything is possible. It’s important to note that the premiums paid for employee benefits are a tax-deductible business expense for the employer. For employees, even if they have to share the cost of their premiums, they’re still getting access to group buying power that they would not have access to if purchasing benefits on their own.
Hand-in-hand with funding extended health and dental benefits is cost control. Luckily, there are a number of ways to help contain costs – especially for prescription drugs. At GroupHEALTH, our Smart Rx solutions target prescription drug costs. These products encourage employees to choose lower cost (equally effective) prescription drugs. They can also target dispensing fees and markups by requiring employees to use a central dispensing pharmacy for full coverage.
Education is another very important way to help control costs for extended health and dental benefits. Encourage employees to “shop around” to secure better prices for the products and services they are claiming; explain the link between cost control and the plan’s sustainability. Many employees don’t even know that different pharmacies charge different dispensing fees. Educate them!
There are a number of good reasons to support employees with extended health and dental benefits. An employee who has coverage for prescription drugs is more likely to actually fill a prescription. By filling their prescription they are addressing a health condition that a physician believed needed to be addressed. Regular dental visits and eye exams also contribute to better health. The eyes have been known to be a window to a body’s health. By finding and addressing health conditions early, you’ll have healthier employees. Healthy employees are more productive, they have fewer absences and they are happier. These are all good things for your organization.
Extended health and dental benefits can also help attract new employees and retain existing employees. In a competitive labour market, this is key. Having the best employees can make all the difference to the success of your business.
Good Advice is Key
Are you considering sponsoring extended health and dental benefits for your employees? Do you want more info about a plan and how it can support your business, within your budget? Review your options with one of our licensed advisors on the phone, or contact us for a comparison quote.
Whether you’re looking for extended health and dental coverage, disability coverage, or life and critical illness coverage, GroupHEALTH has affordable benefits packages that work as hard as you do.