Like many jurisdictions around the world, Canada is experiencing significant increases in benefit costs, notably medical and disability costs.
Several factors contribute to disability cost increases but there are three major factors common to many countries – the ageing work force, stress and depression, and a strained healthcare system.
For those suffering from some form of psychological/psychiatric illness, the average wait for specialist examination is three months, and that does not include the sometimes-lengthy delay before the general practitioner (GP) decides that a specialist intervention is required.
During these months of delay, disability benefits are being paid. Moreover, the longer a person is away from work, the greater the likelihood that the disability will be extended. Complicating matters is the number of stakeholders involved. These include the employer, insurer, therapist, union, employee and so on. At the centre is the GP, whose primary source of information is the disabled employee. The system has no mechanism for co-ordinating these interests.
In response to this, employers are now beginning to establish disability management programmes. Most of these place a strong emphasis on rehabilitation and return to work. However, we believe that the best results come when the primary emphasis is on medical assessment and treatment.
In recent years we have seen the efficacy of medical case management (MCM). Its interventions include providing support to GPs in work capacity evaluation; challenging GPs to develop a medical plan of care; presenting treatment options; co-ordinating drug therapies; and providing information to employees on disease management. This requires that the co-ordinator be qualified in occupational medicine.
We offer two, completely diverse, examples of MCM. The first is a publicly funded occupational pension scheme that transferred 5,000 open, chronic disability case files to MCM. The time on disability ranged from nine months to nine years. Within six months of the introduction of MCM, 30% of those disabled employees were back at work, saving millions of dollars in disability pension costs.
The second case is a company with fewer than 100 employees and a low incidence of disability. However, there were signs of increasing disability rates. MCM was introduced as an employee benefit, referred to as the Employee Wellness Co-ordinator (EWC).
The results were most interesting. On the first day, seven referrals were made to the EWC, mostly by supervisors, and three more in the initial three-month period. This indicated to the CEO a ‘pent-up demand’ of outstanding issues affecting workplace behaviours, which had remained unresolved.
A report by our firm showed savings in time loss to be five times the EWC costs. Calculated savings were the difference between expected and actual disability time loss costs, excluding indirect costs, such as overtime, lost productivity, supervisory time, etc. Reliable studies indicate that indirect costs are between four and 10 times direct costs.
Dan Egan is associate consultant with the firm of D A Townley & Associates Ltd, who are the Canadian representatives of the International Benefits Network, based in Vancouver. Co-author, Kathryn Rud is president and CEO at Healthserv Professionals (BC) Inc, based in Victoria BC.