issue no. 11 may 2015

W is the williamson group’s client newsletter,providing insights and information on

industry trends and developments

2015 federal budget update—personal tax changesgroup retirement savings plans—a word (or two) on member education

type 2 diabetes—calculating the cost of doing nothingpost-concussive syndrome—an increase in concussions or an increase in awareness?

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Wnewsletter

inspiring women:today’s HR leaders

01

director, HR services

inspiring women

In today’s job market, women are dominating the HR profession, comprising seventy-one per cent of the field in North America, and up to seventy-nine per cent in the UK.1 It is a trend that’s been four decades in the making and is visible in both the private and public sectors. And while only forty-three per cent of Chief Human Resources Officer (CHRO) positions in Human Resource Executive®’s 2012 Top 100 list of the United States’ largest companies are held by women, when you consider that the HR pipeline is predominantly female, the likelihood that women will soon take over the CHRO ranks—even at those large companies— is high.

Effective HR leadership goes well beyond managing all of the tasks and responsibilities carried out by the HR job description. It also requires the critical soft skills needed from any leader—courage, judgment, influence, political agility, effective communication—all of these applied to the unique position that HR occupies in an organization. More and more we are seeing HR representation taking a seat at the table with the C-Suite for strategic business planning.

But what are some of these effective HR leaders doing? How did they get to these high-points in their careers? And, what advice would they have for the generation—of primarily women—that will come behind them? We profiled three HR leaders from our client base to find out.

02

colleen falco

niagara casinosColleen Falco’s career aspirations once included being a flight attendant, but her 23 year journey in HR has provided many destinations—some planned and most unplanned—along the way. A certified elementary teacher, Colleen has since worked in education, palliative care, hospitality and retail, but her true love has been HR. Initially recruited to train Niagara Casino’s 4,000 employees, Colleen currently directs a team of HR professionals who strive to create the best work environment possible for their employees. Teamwork is the cornerstone of Colleen’s measure of success and she views achievements and accomplishments to be the result of a concerted collective effort between the HR team and the operations partners.

“There are very real dashboards that measure the results of our contributions in terms of costs or return on investments, but at the end of the day, if the people I work with are happy, healthy, productive, and engaged… that’s the real measure of our success.”

What keeps you up at night about your role / work and why? “People will hate me for saying it, but nothing keeps me up at night. I sleep like a baby.” Colleen finds contentment and excitement in her focus on the future. While there are potential longer term issues that may arise from an aging workforce, she remains prepared by examining strategies that reduce risk from the organization and also support long service staff.

Best advice you could offer to other women who aspire to be successful? “Stay true to yourself and let your performance speak for itself.”

What are you doing to ensure you continue to grow and develop as a leader? “Never stop learning. From reading, to getting feedback from my boss, staff and peers, personal growth and continued evolution as a better leader are always top of mind.”

What will be the biggest challenge for the generation of women behind you? “I think finding balance between work and life will continue to be a challenge for the next generation. Although things are improving in organizations that offer home office options, telecommuting, compressed work weeks, flex hours and other family-friendly benefits, it is always a challenge to balance the demands of work, raising a family, and having great relationships.”

Where do you feel HR makes the biggest impact in an organization and why? “When programs are aligned with overall corporate goals in a meaningful way, the contributions that HR can make to a business are immense. HR can attract and hire employees that fit culturally and support core values. We ensure that compensation, benefits, rewards and recognition support overall corporate goals, and help shape the employment experience in a positive and meaningful way. Through training and talent management initiatives, HR drives cultural and change initiatives by providing leaders with tools to reinforce behaviours that support and sustain the business and enhance performance, productivity and engagement. At the end of the day, people are our business so having an HR department that recognizes and supports our key assets positively impacts the bottom line.”

today’s HR leaders

0403

vice presidenthuman resources

liz volk

longo bros. fruit marketsLiz Volk, Vice President of Human Resources at Longo Brothers Fruit Markets, believes that an organization’s results are achieved primarily through the effort of its people. An SHRP, Liz has acquired 25 years of experience working in fast paced, multi-unit retail environments since she graduated from the University of Western Ontario with an Honours Degree in Sociology. Liz joined the Longo’s team in 2006 with a mandate to develop sustainable strategies that focused on increasing employee engagement. It was a recent yearlong assignment in operations however, that was Liz’s opportunity to fully understand and experience the business at a more grassroots level.

The past year was one that Liz found to be both educational and personally challenging. A corporate mandate for process development and continuous improvement, the project combined HR change management elements with front-line operational involvement, and included responsibility for three store renovations and one new store opening.

directorcore HR programs & services

natalia caetano

parmalat canadaAs Director of Core HR Programs & Services at Parmalat Canada, Natalia Caetano prides herself on having successfully built credibility over 20+ years in the HR industry. Natalia believes people value her honesty and forthrightness.

“My greatest achievement in my career so far is my current position. At first I was primarily interested in the analytical/technical side of HR, but now I find I also enjoy meeting with department leaders—understanding their areas of responsibility and learning more about different aspects of the business.”

Recently, the culture at Parmalat experienced management change, and while different leadership styles can have an impact on company culture, a constant has been the manner in which people interact with one another. The “upfront, respectful, and civil people at Parmalat make it a great place to work,” says Natalia—fostering this herself by trying to exemplify the positive cultural values while providing timely feedback to those who do not.

What was the most impactful feedback you’ve been given in your career and why? “I had a manager tell me during a performance review once that I wasn’t sociable enough. At the time I was confused and angry because I thought I would be praised for my focus on working—and not socializing. It took me years to understand what she meant. Focusing and being able to get the job done is incredibly important, but success also goes hand-in-hand with the strength of the relationships you build at work and the extent of your network adding to your expertise—it’s that magic ability to harness the delicate combination of your hard work and your sociability.”

How has your management style changed over the years? “It probably hasn’t changed that much. I don’t like to micro-manage but will if I have to—I aim to have people working on my team who are capable and independent.”

What keeps you up at night about your role and why? “I find I have a tendency to worry about things if they seem to be a bit off track, so I like to be organized and keep projects on schedule. I also place a high value on quality and integrity, so if I fear that there is an error somewhere that may impact employees, I can’t rest until I am satisfied that everything is correct.”

Best advice you could offer to other women who aspire to be successful? “HR is more than just processing paperwork for employees. It’s important to understand the fundamentals of HR and apply them correctly, while also keeping an eye on the big picture to identify trends in order to keep yourself current. The value of HR is always being challenged and it’s important to participate in showing how HR can make a difference.”

What are you doing to ensure you continue to grow and develop as a leader? “I believe a leader’s role is to provide vision, structure, and guidance. That’s where I focus my energy—to develop those skills. I am also working to build skills that will help me provide feedback that is meaningful and helpful.”

What will be the biggest challenge for the generation of women behind you? “It gets easier for each generation as more women rise in the work world. However, I think women still have to try harder to prove themselves and get noticed.”

“The reason I consider this experience to be one of my greatest career achievements is because—in addition to the company’s success and my own personal growth—the whole process resulted in an opportunity for Team Members to gain new skills throughout the year and it also garnered a few promotions on the HR team due to stretch assignments.” Liz stresses the importance of setting others up for success—one of the fundamental lessons she learned from her father, also an HR professional—and one of the key ways in which she measures success: “People ‘connect all the dots’ in business.” One of HR’s most important functions is the ability to impact a company’s strategic plan through helping people deliver on results.

What keeps you up at night about your role and why? “Our key differentiator in the marketplace is our people. What worries me is sustaining our ability to grow our talent and strengthen our bench within our growth plans. There is definitely a war for talented people out there. Our philosophy is to engage staff and develop leaders from within, but we balance that off with external recruiting to avoid putting team members into positions for which they may not be ready.”

Best advice could offer to other women who aspire to be successful? “Be a business leader with expertise in Human Resources. Get involved in the business by understanding your customers’ needs, and how your people can deliver above and beyond”.

What are you doing to ensure you continue to grow and develop as a leader? Taking risks and challenging herself is one way that Liz continues to grow and develop as a leader and she encourages others to embrace the journey to learn. “Take each opportunity offered to you. Life-long learning comes in many forms—conferences, seminars, connections with other HR professionals and business leaders—continue to grow and develop, so that you have seat at the table, first and foremost, as a business person—who just happens to be in HR.”

What will be the biggest challenge for the generation of women behind you? “What you do within HR helps drive business results. Understand your business and stay relevant by continuously learning. Businesses today look for an HR professional to be a true business partner, which you can’t be—unless you fundamentally understand how your business makes money and how you can help deliver on those key business goals.”

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the president’s perspectiveI think it’s safe to say we started 2015 off with a bang—announcing that The Williamson Group had become a part of Cowan Insurance Group. It was a deal that surprised some, but I think that surprise has turned to an overall understanding of our shared vision. The benefits consulting landscape in Canada has shown a lot of change in recent years. TWG has been an elite level advisor (top 1%) with most of the top benefits and pension insurers in Canada, and by joining with Cowan, we have deepened our industry depth and impact, which will serve to help our colleagues and our clients.

When we approached this juncture in TWG’s history, we were cautious. The rest of the Leadership Team and I knew that growth was necessary to remain competitive and solidify our future. Like Goldilocks, we didn’t want to be too big, or too small. In the end, I am proud to say that we truly found our fit with Cowan Insurance Group—it’s just right.

For TWG and Cowan, 2015 is all about synergies—increasing the value of the two organizations by coming together to share products, R&D, and reach in market. This strategic acquisition will allow us to position ourselves together for market leadership. And, we want to be leaders in the industry, so that we can continue to be strong leaders and advocates for you, our clients.

While working through this process, we have grown to understand just how well aligned our two companies are in terms of: • culture—including how we engage with our colleagues,

clients, and business partners • community involvement—we both have a strong history of

philanthropy and service• how we do business—we are both focused on service

excellence and are strong thought leaders in our areas of specialization

• presence—both companies have strong local, regional, national and international relationships

As we continue this year, we are being careful with our Integration planning. Those who have gone through Mergers and Acquisitions will know it can be time consuming. One of the terrific things about the leadership at Cowan is that they are appreciative of our client-first focus, and are patient with respect to achieving the full integration of the combined organization. When things are of mutual benefit, we explore them and devote energy to the projects. This is one of the benefits of joining Cowan, as they are a privately held company. As always, we are being diligent in keeping our client-facing teams where they belong and where they love to be—with our clients.

I’m heartened each day as I see how well the team at The Williamson Group has embraced this change, and remain focused on their passion for client service. After all, that is one of the many reasons Cowan courted us here at The Williamson Group.

As we continue this journey together, please feel free to reach out to me should you have any questions or feedback. Until then, enjoy this spring weather and whatever adventures each new day may bring.

Don Williamson, President

personal tax changes from an individual investment perspective

2015 federal budget

Several of the proposals tabled during the recent 2015 federal budget will have an impact on the financial, tax, and estate plans of Canadians. Still pending revisions, the budget will most likely pass into law due to the current government’s majority status. A short summary of proposals with the most relevance to Individual Investment advisors and clients are listed below.

The budget proposes to raise the TFSA annual contribution limit to $10,000 for 2015 and subsequent years. The maximum contribution limit going forward will not be indexed as it has been in the past. From 2009 through to 2012, the TFSA limit was set at $5,000, indexed to inflation in increments of $500—increasing to $5,500 in 2013.

Any income, gains or withdrawals from a TFSA are tax exempt. Contributions to a TFSA are not tax deductible. Unused TFSA contribution room is carried forward and withdrawals from a TFSA can be re-contributed to a TFSA in future years. Clients who have yet to start a TFSA will have accumulated $41,000 of TFSA contribution room (assuming the client was age 18 in 2009 and meets other eligibility criteria). Because TFSAs are under-utilized by many Canadians, now would be a prime opportunity to talk to your advisor about your TFSA strategy, and how it can work for you.

tax free savings account (TFSA) limit to rise

060807

minimum RRIF withdrawals

Clients must convert their Registered Retirement Savings Plan (RRSP) into a Registered Retirement Income Fund (RRIF) by the end of the year in which they attain age 71. A pre-determined minimum amount, designed to provide income in retirement, must be withdrawn annually from the RRIF no later than the year in which the client reaches age 72. The minimum amount is based on factors designed to provide a regular stream of payments from age 71 to 100, assuming a 7% rate of return and 1% indexing. Once the RRIF annuitant reaches age 94, the withdrawal rate is capped at 20%.

Budget 2015 proposes to adjust the RRIF minimum withdrawal factors that apply in respect of ages 71 to 94, based on a 5% rate of return and 2% indexing. There will be no changes to RRIF factors for ages 70 and under or age 94 and above. This will lower the required minimum amounts on an annual basis and allow clients to preserve more of their RRIF assets as they age, while still continuing to benefit from tax deferred growth within the plan. The new RRIF factors will apply for the 2015 and subsequent taxation years. Individuals who have already withdrawn more than the proposed reduced 2015 minimum amount, will be permitted to re-contribute the excess amount to their RRIF’s. Re-contributions will be permitted until February 29, 2016 and will be deductible for the 2015 taxation year. Make sure you revisit your retirement income goals with your advisor if RRIFs are included in your plan.

Comparison of the existing and proposed new RRIF factors:

home accessibility tax credit

A new Home Accessibility Tax Credit will provide tax relief of 15 per cent on up to $10,000 of eligible expenditures per calendar year, per qualifying individual, to a maximum of $10,000 per eligible dwelling—including seniors and persons with disabilities—to make accessibility and safety related home improvements to their principal residence. Your advisor can provide you with more information on eligibility.

family tax cut—education credits

A previously announced measure, the Family Tax Cut is a non-refundable tax credit of up to $2,000 for couples with children under the age of 18, effective for the 2014 taxation year, which allows income splitting between eligible spouses. The budget also proposed revision to the Family Tax Cut for the 2014 and subsequent taxation years to ensure that education-related credits transferred between spouses receive the appropriate value.

extending compassionate care benefits

Through the Employment Insurance (EI) Program, Compassionate Care Benefits provide financial assistance to people who have to be away from work temporarily to care for a family member who is gravely ill with a significant risk of death. The Government plans to extend the duration of this benefit from the current six week duration to six months, as of January 2016.

age (at start of year)

71

72

73

74

75

76

77

78

79

80

81

82

83

84

85

existing factor %

7.38

7.48

7.59

7.71

7.85

7.99

8.15

8.33

8.53

8.75

8.99

9.27

9.58

9.93

10.33

new factor %

5.28

5.40

5.53

5.67

5.28

5.98

6.17

6.36

6.58

6.82

7.08

7.38

7.71

8.08

8.51

age (at start of year)

86

87

88

89

90

91

92

93

94

95 & over

existing factor %

10.79

11.33

11.96

12.71

13.62

14.73

16.12

17.92

20.00

20.00

new factor %

8.99

9.55

10.21

10.99

11.92

13.06

14.49

16.34

18.79

20.00for more information

Contact a member of The Williamson Group’s Individual Financial Services team to explore how these Federal Budget

updates may affect you.

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We understand that there are a multitude of communication opportunities available to plan sponsors to assist in member education. So, to simplify the selection process we wanted to spend some time outlining the most popular choices, and some of the associated advantages and disadvantages of each:

Regardless of the route you take, plan sponsors should be cognizant of their member demographics, literacy levels, and the communication channels available to them throughout the educational journey. Focus on the key retirement concepts such as the different investment options available to them, the importance of starting to contribute early, diversifying investments and choosing a personal investor style.

A commitment to education and financial literacy is an investment in corporate culture and employees—building employee engagement in their retirement planning and fostering an appreciation of your group retirement program.

traditional group presentationsadvantages:

1. most interactive communication method2. provides a social and safe environment in which to ask

questions3. offers the best opportunity for dialogue4. demonstrates HR’s interest in employee well-being

disadvantages:1. logistical difficulties in accommodating multiple shifts

and locations2. organization is more labour intensive in terms of HR

time and effort 3. facility restrictions may be an impediment4. carrier education team requires commitment

webinar presentationsadvantages:

1. ease of participation, regardless of location2. spouses and family members have access to

education3. requires less organization but more advertising4. may be recorded for future viewing/reuse

frequent targeted mass messaging—e-mail blasts, payroll stuffersadvantages:

1. provides continuous reminders employees2. topics can build on a theme3. allows for unlimited content in an effort to enhance

financial literacy4. involves the least amount of HR effort

disadvantages:1. low response rate2. more easily disregarded3. not all employees have corporate email address4. pay envelopes are no longer as common

investment coachingadvantages:

1. the most personal and effective method to “reach” employees

2. results in unsurpassed employee engagement and employer appreciation

3. offers customized investment strategies, based on age and risk tolerance

4. accessible anytime by phone

disadvantages:1. no direct interaction2. easier to disregard/not pay attention3. decreased likelihood of member action4. participation tracking may prove challenging

disadvantages:1. involves scheduling for onsite investment coaching2. limited location accessibility

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a word (or two) on member education and communication

Clear ongoing member communication and education are integral components of any successful company-sponsored Group Retirement Savings Plan. Provision of information and documents to plan members is a primary responsibility of plan sponsors. Engaging employees to take an interest in their own pension fund and promoting financial literacy, however, can often prove to be the most challenging part of this process.

Even should they choose to delegate some—or all—of these tasks to a service provider or carrier, employers who sponsor a Group Retirement Savings Plan, or CAP (Capital Accumulation Plan), inherently assume certain responsibilities towards their plan members Some of these tasks include:

• initial plan set up and introduction• provision of investment information and decision-

making tools• provision of on-going communication• plan maintenance• ensuring compliance to the terms of the CAP with respect to plan, or member, terminations

focus on quality—not quantity—of informationFor many years, the standard practice has been to supply employees with a myriad of information at the time of eligibility and hope that they actively participate in their plan. This is no longer viable. In an age where we are constantly bombarded with messages, the importance of not overwhelming employees with information cannot be overstated. For maximum effectiveness, plan sponsor communication should be worded and formatted in a manner that facilitates ease of understanding. It should be relevant, timely and provided in digestible amounts. Adapt your plan where necessary to address the specific needs of your own employee base and include topics that are ‘stage of life’ relevant in order to engage employees on an emotional level.

Pinpointing a valuable message that resonates amongst members with a potentially wide range of comprehension and experience can be complicated. Deciding on the most effective delivery method can prove to be a further challenge. Complicating factors may include:

• tight production schedules• HR professionals already extended to capacity• facility restrictions and constraints• multiple shifts and locations• difficulty in measuring effectiveness• carrier content limitations

Ongoing education gently and consistently reminds employees of the value and rewards of taking responsibility for their own retirement planning. In the end, the true test often boils down to simple logistics—finding enough time to make employee education a priority, and facilitating a delivery method that effectively shares this information.

a little help from your friendsInsurance carriers have invested considerable time and money in member website development to make learning interactive and fun. From handy retirement calculators to interactive financial gamification, interviews, and videos, these tools assist in collecting and disseminating information for members in an unintimidating manner. Member web portals serve as a great introduction for plan members where they can develop a simplified understanding of retirement and financial terminology, goals, and risk factors. However, as self-directed learning modules directed at a mass public, they can’t take into account individual situations and varied learning styles. They should be seen as an added bonus and not a complete solution.

group retirement savings plans

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concussion typesA concussion is a mild traumatic brain injury (TBI) caused by a blow or jolt to the head, or any kind of fall or blow to the body that causes the head to move back and forth rapidly. Depending on factors such as loss of consciousness, amnesia, or loss of equilibrium, concussions are graded as:

• mild (Grade 1) - symptoms last for less than 15 minutes; no loss of consciousness• moderate (Grade 2) - no loss of consciousness, but symptoms last longer than 15 minutes• severe (Grade 3) - includes loss of consciousness, however brief

The risk of post-concussion syndrome doesn’t appear to be associated with the severity of the initial injury and loss of consciousness isn’t required for a diagnosis of concussion, or post-concussion syndrome.

recovery and after-effectsPost-concussion symptoms commonly manifest within the first 7-10 days after the injury and resolve within three months (Larrabee and Rohling 2013). Some may persist for a year or more, however, and may not be noticed until the individual begins to face resumption of everyday activities. Recovery may also be slower among older adults, young children and teens, as well as among those who have previously suffered a concussion.

While most people recover in a short period of time, an estimated 10 per cent will have lingering effects, or experience ‘post-concussion syndrome’—a complex disorder in which symptoms may last for weeks or months after the initial injury. Ninety per cent of individuals who experience post-concussion syndrome will be fully recovered within two years.

Concussion symptoms are often grouped into four categories: cognitive, physical, emotional, and sleep disturbances. Diagnosis is made by brain scan and other neuropsychological and neurocognitive tests that assess learning and memory retention, concentration capability, cognitive reaction time and problem solving capacity. The tests, unfortunately, are not definitive and some studies suggest that at three months post-concussion, cognitive impairment could just as likely be due to pain, emotional distress, depression and fatigue3. Some studies suggest that poor test results are simply attributable to poor effort4. For example, in the absence of a head injury, subjects with chronic pain have reported symptoms similar to post-concussive symptoms—disturbed sleep, fatigue, irritability, cognitive complaints5, as have healthy patients with self-reported depressive symptoms6.

best practices for dealing with an employee experiencing a concussion The key to managing a concussed employee is getting, and following, the best medical advice after a head injury. An initial evaluation should assess the level of consciousness and establish if there has been any loss of consciousness, or if confusion or amnesia are present. Patients who report amnesia following a concussion tend to have more symptoms, and a longer duration of symptoms, as well as decreased test performance.

Case Management factors for successful treatment include: early diagnosis, education of the employee and their family—with reassurance that permanent cognitive impairment is not expected, cohesive team treatment with a consistent message, and a moderately-paced graduated return to work. Good success rates are possible with early and appropriate treatment and a multi-disciplinary brain injury rehabilitation team may be required for an employee with persistent symptoms.

A thirty-day to three-month rest and recovery period is a key best-practice milestone to keep in mind when facilitating a successful return-to-work in order to help protect the employee from re-injury or aggravating the brain injury. If symptoms have not improved after three months, the employee should be encouraged to seek referral to a neurologist for additional testing. A specialist will be able to measure the level of impairment, and help determine if potential causes of symptoms may stem from other physical or motivational factors.

1 Workplace Safety & Insurance Board of Ontario (July, 2014)2 MDs decry concussion ‘hype’ (April 7, 2014) Winnipeg Free Press3 Intact Cognition in Depressed Elderly Veterans Providing Adequate Effort, Archives of Clinical Neuropsychology (2011): 26, 184-1934 Noncredible Explanations of Noncredible Performance. In Carone and Bush eds. Mild Traumatic Brain Injury: Symptom Validity Assessment and Malingering. 2013: p 73-965 “Postconcussive” Symptoms in Persons with Chronic Pain. Brain Injury (1997): 11(11), 783-7906 Examination of “Postconcussion-Like” Symptoms in a Healthy Sample. Applied Neuropsychology (2003): 10(3), 137-144

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an increase in concussions or an increase in awareness?

Few health issues recently have received more media attention than sports-related post-concussive syndrome. While it’s true that risk is inherent in all athletic pursuits, the reality is that head injuries can just as easily occur at home or at work. The latest statistics indicate that the number of lost-time concussion claims reported by Ontario Workers’ Compensation has almost quadrupled in the past four years—from 113 in 2009 to 420 in 20131. The upswing in the number of reported concussions may indeed be due to an actual increase in head injuries. Some doctors, however, are postulating that it may be the result of a heightened likelihood on the part of employers to characterize head injuries as a “concussion,” due to the increased media attention to this injury2.

Are the headlines reflective of an overall increase in post-concussive syndrome—or is an increased awareness of this injury simply fueling the increase in reported claims?

post-concussive syndrome

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what can you do at work:The Canadian Diabetes Association suggests a three-pronged approach towards prevention that can help your organization link corporate health and wellness initiatives to overall employee health, while increasing education and understanding about Diabetes.

1. Create a broad-based Diabetes prevention strategy. A variety of Diabetes management and prevention strategies are available.

2. Target persons at risk by focusing on areas affected by lifestyle and habits. Ensure participation from the segment of your employee population that could most benefit from screening, but who may avoid it. Myths and misconceptions regarding the causes and management of Type 2 Diabetes abound. Educate your employees so they are aware of the real risks and what they can do avoid being a statistic.

3. Promote secondary prevention strategies, such as workplace wellness programs. Run screening programs that include BMI checks, body measurements, diet counseling, physical fitness guidelines, blood pressure monitoring and cholesterol testing. Meaningful health and wellness initiatives could improve health outcomes and positively impact overall drug plan spend.

4. Finally, be proactive. Encourage healthy employee behaviour through plan design. A recent drug study by Green Shield revealed that in 2014, plan sponsors spent 144 million dollars on glasses, massage, chiropractor and footwear in comparison to a mere $100,000 spent on dietitians and nutritionists.

The cost of “doing nothing” is clearly not financially sustainable. As a plan sponsor you have the unique capability to make a positive impact not only on your financial bottom line, but also on the health and lives your employees.

additional resources available:Canadian Diabetes Association — diabetes.caHealthy Canadians / Government of Canada — healthycanadians.gc.ca

TWG can help:Discuss your options with your TWG Consultant and watch for our Diabetes Employer Resources Guide, due out this November.

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calculating the cost of doing nothing

In the last issue of W, we examined the benefits of performing an in-depth drug plan analysis for one of TWG’s corporate clients—Client A—assisting them with cost management and future benefit program planning. The data revealed that more than any other Age Related Chronic Condition, Type 2 Diabetes is having an increasingly adverse impact on Client A’s group benefit plan performance. And it’s safe to say it will impact yours as well.

Diabetes has been identified by the World Health Organization as a global epidemic that is expected to cost the Canadian healthcare system an estimated $16.9 billion annually by 2020. Type 1 Diabetes is an autoimmune disorder, characterized by the cessation of insulin production. It necessitates daily injections of insulin to maintain life and the cause is unknown. Gestational Diabetes results from high blood sugar levels that may occur during pregnancy, but usually disappear within six weeks of delivery. In contrast, excess weight and physical inactivity, which can impair effective utilization of insulin by the body, are a significant contributing factor to Type 2 Diabetes.

Type 2 is the most common form, affecting 90% of diabetics world-wide. Considered to be a disease state that is changeable with lifestyle modifications—adopting a healthier lifestyle can help prevent or control Type 2 Diabetes and significantly reduce the risk of complications. Projected to be the seventh leading cause of death world-wide by 2030, over nine million Canadians are currently living with Diabetes or pre-diabetes.

For Client A in particular, The Williamson Group’s drug study identified eight employees in a pre-diabetic state. With coverage to age 67, a conservative cost estimate of eight plan members who are currently in a ‘pre-diabetic’ state becoming diabetic at age 50, is $306,686. Pre-diabetes is a key risk factor for Type 2 Diabetes. If left untreated more than half of the people who are diagnosed with the condition will develop Type 2 Diabetes within eight to ten years. Most importantly, pre-diabetes can be managed, or in some cases reversed, through healthy lifestyle choices.

It is important to remember that the increased prevalence of Diabetes amongst claim costs only reflects diagnosed patients; undiagnosed diabetics pose a significant future burden to group benefit plans. An estimated five million Canadians over the age of 20 are currently pre-diabetic, with an additional one million new cases of pre-diabetes expected by 2016. Pre-diabetes is often easy to miss and occurs when blood sugar levels are high, but not high enough to diagnose. The slow progression and nature of Diabetes allows for it to go undetected for long periods of time.

Untreated, it can lead to serious complications and it is these complications that pose the greatest threat to the future of our healthcare system—with Group Plans carrying the brunt of the burden for working-age individuals. The cost of complacency is significant if action is not taken, not only in terms of plan dollars, but also in personal impact on employees and their families.

For many employers, Diabetes now ranks among the costliest of therapeutic classifications, based on amount paid per claim and number of claimants. Employees with Diabetes regularly incur medical costs that are 2-3 times higher than those without. For Client A, this has translated to a four-fold increase in Diabetes related claims over the last eight years, while experiencing only a doubling in size of the employee population.

Awareness and action are critical. As a plan sponsor, you can make an effort to understand your own risk factors by discussing plan performance with your TWG Consultant. A thorough understanding of current plan costs and trends will help in the mitigation of future liability.

type 2 diabetes

Find out more about our singular approach to the provision of health and wealth solutions:

225 King George RoadBrantford, ON N3R 7N7

Tel Local: 519-756-9560Toll Free: 1-800-265-9973

info@williamsongroup.com

williamsongroup.com

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