| Dan Eisner, Advisor, ZLC Employee Benefits Solutions |
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Employee benefits plan sponsors are faced with a dilemma when it comes to obesity. This chronic disease drives higher premium costs due to broad-based drug plan utilization for multiple conditions, increased use of other medical services and supplies, higher risk of reduced productivity and absenteeism, and the risk of deteriorating mental health. There are emerging new therapies available, particularly around a new class of drugs (like Ozempic/Wegovy and stay tuned for Mounjaro), that provide promising results for weight loss, but these therapies would also cost more money for group benefits plans in the short term. What is a plan sponsor to do? Canadians are less healthy than they have ever been with an increasing proportion being overweight, obese, or morbidly obese. According to Statistics Canada, in 2018, 26.8% of Canadians aged 18 and over were classified as obese and another 36.3% as overweight, bringing the total population with increased health risks due to excess weight to 63.1%. This situation is not likely to change any time soon. Healthcare practitioners and the general public can agree that there is a direct link between obesity and other health risks, including but not limited to Diabetes, heart disease (blood pressure and high cholesterol), stroke, chronic pain, some cancers, and even anxiety and depression. Broader interest in using prescription drugs to help with weight loss continues to grow, even though some of these drugs may have been developed primarily for the treatment of Diabetes. However, few employee benefits plan sponsors currently provide coverage for weight loss drugs. According to the TELUS Health Retrospective 2022: Drug Trends and National Benchmarks report, less than 5% of plans in Canada cover weight loss drugs, which is coincidentally very similar to fertility and sexual dysfunction drug coverage. Unfortunately, all three of these types of drugs have usually been classified by many as “lifestyle drugs” and thus coverage has been less readily provided by group benefits plans. This mislabeling can be potentially dangerous and unfair. We really need to ask ourselves whether individuals consciously decided to gain weight or become obese. Given that obesity is medically recognized as a chronic disease, why do we view it as a lifestyle decision? We do not apply this reasoning to many other diseases where lifestyle choices likely also contributed to the condition (i.e., Type 2 Diabetes, cardiovascular diseases, some cancers, etc.). Are we guilty of “weight bias” and creating a “stigma” for overweight and obese people? The sooner we agree that obesity is a chronic disease that adversely impacts our employees and thus our businesses, the sooner we can get on with looking for treatments. Additionally, the issues surrounding obese and overweight employees dovetail into two other current trends in human resources. Firstly, there is a heightened focus on employee health and wellbeing, so does it not make sense to support obese and overweight employees in their efforts to lose weight and improve their overall health and wellbeing? Secondly, there is also a growing focus on Diversity, Equity and Inclusion initiatives, so does it not make sense to address the needs of approximately two-thirds of your employee population around weight loss? Might employees be more interested in pursuing weight loss initiatives if they feel supported by their employer under both the wellbeing and DEI banners? The risks related to obesity are significant to businesses and therefore the opportunities related to weight loss drugs are also significant. How do you balance the idea of promoting and investing in employee health and wellbeing as compared to the higher cost of new weight loss drugs? Businesses need to recognize that obesity is going to cost them either way, so employee benefits plan sponsors are at a critical crossroad. If they do not cover weight loss drugs, benefits plan utilization will continue to rise and drive premium rates up in the short and long term. If plan sponsors do decide to cover weight loss drugs, the benefits plan costs will rise in the short term but there is the potential for them to come down in the mid-to-long term, along with higher productivity and improved mental health and wellbeing. Ultimately, the choice is yours. We would be pleased to discuss your specific situation with you to identify the best strategy for your employee benefits plans. Should you have any questions on the above, please do not hesitate to contact any member of our team. ZLC Employee Benefits Solutions is one of the fastest growing advisors for employee benefits and group retirement programs in Vancouver and we are fortunate to have the best people, resources, and clients. We provide value by leveraging one of the most skilled benefits teams – collectively over 400 years of experience within our team of 20 employee benefits specialists. We have been working with businesses ranging from 3 to over 75,000 plan members for over 35 years. |
