Modernising your health care programme...Source: 2017 Global Benefits Attitudes Survey Managing my...

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Modernising your health care programme

Global and European focus

April 24, 2018

© 2018 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.


Today’s discussion

Benefits

matter

Global and

regional

research

findings

Introductions

and Speakers

Key

employer

issues and

actions

Summary

and

Questions

© 2018 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.2


Today’s speakers

Francis ColemanHead of Health and Benefits

Global Services & Solutions


Kevin NewmanHead of Health and Benefits

Great Britain

Shannon BoyleHead of Health and Benefits

Western Europe


Overview of Willis Towers Watson research

Key studies with flexible benefits information

4© 2018 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

Benefit Trends (non-U.S.)

Best Practices (U.S.)

Employers’ benefits strategies

and priorities over the next

2 − 3 years

Employees’ desires for choice

Global Benefits Attitudes Survey

Employees' attitudes, preferences and

behaviours around their health and retirement

benefits

Employer strategies

and actionsHealth care costs

Global Medical Trends

Annual survey of leading

insurers in over 60 markets

on medical inflation rates

and key cost drivers

Nearly 700 employer

responses in the US and over

3,400 responses outside U.S.

across nearly 70 markets

Over 200 insurers across

60 markets where most

have >10% market share

Over 30,000 responses across

22 markets by employees at

medium to large private sector

companies

willistowerswatson.com 5© 2018 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

The conversation is changing for benefits

.

SegmentationTailoring benefits and services

to unique workforce segments

Well-beingContinued focus on

holistic physical,

financial, social and

emotional

health

Consumerism &

Flexibility Expansion of choice and flexibility

with navigation and decision support

.

Technology

Advancements Digitisation is changing

the delivery, expectations and the

experience in benefits

Talent Experience Emphasis on workplace

differentials that enhance the

environment and Talent Value

Proposition

Analytics &

InsightsEnabling analysis

personalisation and

measurement

Social ResponsibilityIncreased awareness of

legislative actions , social

policies and programmes

Financial ConcernsRenewed focus on financial

security now and in the future

Organisational

Agility

.

Future FocusedEmerging work dynamics and a

multi-generational

workforce are evolving

the benefits strategyBeing agile and nimble to

adapt to changing, fast-moving

business strategies domestically

and globally


Benefits matter now more than ever before

Increasing media coverage

Deutsche geben 100 Milliarden

für Wellness & Co. aus

El 58% de las empresas de Europa Occidental no tienen una estrategia

formal de salud y bienestar


Benefits matter now more than ever before

Voice of the employee


Note: Percentages indicate ‘Agree’ or ‘Strongly agree’.

Source: 2017 Global Benefits Attitudes Survey

Managing my health is

a top priority in my life

My retirement security

has become a more

important issue for me

over the last 2 or 3 years

Managing my finances

is a top priority in my life

65%

56%

67%

72%

North America

EMEA

Asia Pacific

Latin America

77%

67%

74%

77%

North America

EMEA

Asia Pacific

Latin America

69%

51%

55%

69%

North America

EMEA

Asia Pacific

Latin America

Percentage of highly engaged

52% 48%61% 63%

25% 21% 18%28%

North America EMEA Asia Pacific Latin America

My benefits package meets my needs

My benefits package does not meet my needs


Five macro trends driving the evolution of the benefits portfolio


CHALLENGES

Speed of Change

Continual assessment

and adoption of new

ideas and innovations

Workforce Dynamics

Revisit benefits eligibility,

structure and framework

to meet needs of a

diverse, multi-generational

increasingly contingent,

workforceTechnology and

Digitisation

New delivery platforms and

employee expectations on

service delivery/personalisation/

navigation and decision support

Productivity Needs

Focus on employee well-

being and rewards structure

to increase engagement and

retention

Rising Costs

Need to move beyond

one size fits most to

greater choice and

efficient benefit offerings

OPPORTUNITIES


Rising Cost of Benefits

Share of benefits over total compensation*


Source: *Organization for Economic Co-operation and Development for select markets where data is available. : 2017 Willis Towers Watson Regional Benefit Trends Survey

7points

Since 1970s

1970 1980 1990 2000 2010

13%

19%

Developed Countries

Europe Asia Pacific Latin America

#1 Rising benefit costs Rising benefit costs Rising benefit costs

#2 Regulatory changesInsufficient financial

support

Insufficient financial

support

#3Insufficient financial

supportRegulatory changes

Lack of technology

solutions

Key challenges employers face with

their benefit

programmes over the

next three years


Growing global medical inflation

Health Care Cost Trends


Source: Global Medical Trends Survey, multiple years

Key Findings

Survey respondents expect average

global medical inflation to be 7.2% in

2018, compared with an average of

6.8% in 2017. This continues to far

exceed the average general inflation

rate in respondent countries, which is

projected at 2.5% in 2018 (International

Monetary Fund weighted figures).

Continuing the theme of past years,

more than half of health insurers

globally expect the upward trend to be

greater or significantly greater over the

next three years.

33%

36%

48%

41%

39%

59%

54%

41%

50%

51%

8%

4%

7%

7%

6%

0% 20% 40% 60% 80% 100%

Middle East/Africa

Europe

Asia-Pacific

Americas

Global

Significantly lower Lower About the same Higher Significantly higher

6.9%

5.1%

6.8%

4.6%

7.2%

4.7%

Gross Cost Trends Net Cost Trends

2016 2017 2018


Companies aspire to use their health and well-being programme to

differentiate their organisation from competitors

No Strategy Adopt

StrategyCommunicate

and DeliverDifferentiate

and CustomiseOffer various

programmes but have not

formally articulated a

health and well-being

strategy

Adopted and articulated a

health and well-being

strategy with stated

objectives for each

programme

Effectively communicated

to employees the strategy

and value proposition

behind health and well-

being programmes

Differentiate our health

and well-being from other

organisations with which

we compete for talent,

customise for critical

workforce segments

48%

3%9% 9%

31%

17%12%

72%

Today In three years

Source: 2017 Willis Towers Watson Regional Benefit Trends Survey, EMEA.

Which of the following steps best describe what your organisation has accomplished in

your health and well-being strategy to date and what you expect to accomplish in the next

three years?


The majority of employers are seeking to improve the

consumer experience


Note: Percentages indicate ‘very important’ or ‘important’.

Sources: 2017 Willis Towers Watson Best Practices in Health Care Employer Survey; 2017 Regional Benefits Trends Survey

Employee experience:

Enhance employee perceptions about the workplace culture, and technological and physical environment

U.S.

78%

Asia Pacific

67%

Latin America

67%

EMEA

55%


Consumer-driven benefits

The good news: Companies already have been doing this for decades


Flexible benefit programmes

Cafeteria style

Virtual workplace

DB pension plans

Voluntary benefits

Flexible work arrangements

Paid time off

AI-driven decision

support and analytics

Consumer grade,

high-touch experience

DC pensions + additional

wealth accumulation and

financial education

Conditioned focused health

care plan and pathways

Telemedicine

Rehabilitation focus

CSR programmes

Wellness and prevention

Broadening of voluntary

programmes

THEN NOW FUTURE


Disconnect between employer and employee views on benefits

meeting employee needs

Note: Percentages indicate ‘Agree’ or ‘Strongly agree’.

Employee sample: All employees. Except U.S. and Canada, full-time employee only. * US employer data only.

Source: 2017 Global Benefits Attitudes Survey; 2017 Benefits Trends Survey; 2017 Best Practices Survey

“Our health care plans

and well-being

programmes meet our

employees’ needs”

81%

63% 62%

72%66%

55%

63% 64%

39%

28%

41% 40%

0%

20%

40%

60%

80%

100%

NorthAmerica*

EMEA Asia Pacific LatinAmerica

Employer

Employee - health care plans

Employee - well-being initiatives

“Our benefits package is

flexible enough to meet

our needs”

43%

32%39% 40%

0%

20%

40%

60%

80%

100%

NorthAmerica*

EMEA Asia Pacific LatinAmericaEmployee


We define three levels of flex for core benefits


No choice in core

benefits

Voluntary benefits

Choice in

level of benefits

Flex fund

Buy a more generous or

less generous option for a

given set of benefits defined

by your employer

Move money between

different company

benefits and chose the

benefits you want/need

from a pool of choices

12 3

Employees can opt to buy individual products via

their employer but paid for directly by themselves



Offering more choice and flexibility increases employee appreciation

Overall, my benefits package meets my needs?


North America EMEA

Latin America Asia Pacific

40%

62%67%

54%

72%76%

No choice in corebenefits

Choice in level ofbenefits

Flex fund

30%

47%55%

48%

64%70%



Flex fund

20%

53%58%

33%

67%74%



Flex fund

31%

62% 62%54%

71% 73%



Flex fund

Sample: All employees. Except U.S. and Canada, full-time employee only.


+36+40

+54+42

Without voluntary benefits With voluntary benefits


Employers recognise the importance of voluntary benefits in

enhancing the employee value proposition


Source: 2017 Willis Towers Watson Regional Benefits Trends Survey; 2017 Best Practices Survey.

Employer Motivations

Half of employers identified adding employee

choice/flexibility regarding which benefits they

receive as a top priority over the next 3 years

EMEAEmployers offer or plan to offer voluntary benefits

86%

46%

41%

39%

66%

25%

20%

24%

U.S.

EMEA

Asia Pacific

Latin America

In 2017 By 2019

1

2

3

U.S. EMEA Asia Pacific Latin America

Enrich existing core benefit

plans (79%)

Promotes understanding or

appreciation (67%)

Recognise the diverse

needs and values (76%)


appreciation (64%)

Appeal to multiple

generations (75%)

Recognise the diverse

needs and values (60%)


appreciation (75%)

Improves attraction and

retention (63%)

Support employee financial

well-being (74%)


retention (60%)


retention (63%)

Improves employee

engagement (58%)

51%


Employees show an interest in a broad set of benefits

If you were provided with an allowance to spend on a variety of benefits, where

do you think you would spend your money?




24%

28%

23%

20%

6%

7%

9%

9%

21%

8%

12%

13%

5%

6%

8%

8%

9%

13%

12%

12%

8%

9%

11%

12%

10%

7%

5%

8%

4%

5%

5%

5%

12%

18%

15%

13%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

North America

EMEA

Asia Pacific

Latin America

Retirement

plan

Financial

well-being

programmes

Health care

plan

Health &

well-being

Financial

protection

Life

insurance

Dental,

vision/optical

plan

Personal

insurance

Annual paid

time off


Balanced Thriving

Secure Connected

Well-being

Understand and take charge

of my health

Engage in my health and

maintain a healthy lifestyle

balance

Manage acute and unexpected

illnesses and injuries

Assess, manage my financial

commitments

Set and achieve my goals and

choices

Ability to absorb a financial

shock

Self aware and maintaining mental health

Manage my emotional health, address stress

Handle life crises

Strengthen, cultivate my network

Develop, maintain my network

Resolve conflicts and issues

Emergence of well-being programmes

Employers plan to add more well-being programmes of all types, than any other

benefits, over the next three years


Mental health issues are increasing around the world


Stress is identified as the #1 lifestyle risk globally

Have you suffered from severe stress, anxiety or depression in the last 2 years? (% of ‘Yes’)

33%

29%

21%

32%

0% 10% 20% 30% 40% 50%

North America

EMEA

Asia Pacific

Latin America

More than half of employers

have either introduced initiatives to

reduce stress or are planning to do

so in three years

71% 69%63%

57%

0%

20%

40%

60%

80%

U.S.*

EMEA

Asia Pacific

Latin America

Note: * refers to importance over the next three years

Employee sample: All employees. Except U.S. and Canada, full-time employee only.

Source: 2017 Global Benefits Attitudes Survey; 2017 Benefits Trends Survey; 2017 Best Practices Survey


Employees’ financial concerns are on the rise


Source: 2017 Willis Towers Watson Best Practices in Health Care Employer Survey. 2017 Benefits Trends Survey 2017, 2017 Global Benefits Attitudes Survey.

Financial concerns have become a more important

issue for employees over the last two or three years

of employers agree to take an active

role in encouraging employees to

better manage their personal finances58%

40%Live paycheck to

pay checkStrongly agree or agree

North America 45%

EMEA 38%

Asia Pacific 31%

Latin America 45%

In US, employer financial

well-being activities are

expected to expand by 2020

Provision of financial

well-being programmes

31%

33%

31%

18%

20%

22%

EMEA

Asia Pacific

Latin America

$$

$

$

$

$

$

3X

Global Result

Asia Pacific

69%57%

41%

68%

NorthAmerica

EMEA Asia Pacific LatinAmerica

Why well-being?

© 2018 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only. 22

Financial, health issues and stress work together to make a bad situation worse…

Source: Willis Towers Watson 2017/2018 Global Benefits Attitudes Survey, Global Results

>4 in 10Employees who reported health issues and financial issues

3xMore likely to

suffer from high stress

3xMore likely to

be disengaged

2 daysAverage of additional missed

days per year

44%Less likely

to be

satisfied

with their

financial

situation

Only 2 in 10 employees report no financial or stress issues

34%More likely to live

paycheck to paycheck

2.5xMore likely to work

past age 70


Employer Employee

50%

Employers overestimate the impact of their well-being initiatives

Note: Percentages indicate ‘Strongly agree’ or ‘Agree’.

Source: 2017 Best Practices in Health Care Employer Survey; 2017 Benefits Trends Survey 2017; Global Benefits Attitudes Survey, United States.

“The company’s

well-being

programmes have

encouraged

employees to live a

healthier lifestyle”

North America Latin America Asia-Pacific EMEA

56%

31%

51%

37%

52%

40% 41%

25%

0%

20%

40%

60%

Employer Employee

Global results

33%


Employees show little appreciation of employer initiatives globallyOn a scale of 0-10, how likely are you to recommend your employer’s health and well-being initiatives

and activities?


-47

-33

-16

-11

-1

-56

-51

-100 -50 0

Argentina

Chile

Brazil

Colombia

Mexico

Canada

USA

North America

Latin America

-65

-64

-59

-54

-52

-47

-46

-28

-100 -50 0

UK

France

Netherlands

Turkey

Ireland

South Africa

Germany

UAE

EMEA

-75

-64

-55

-48

-31

-18

6

-100 -50 0

Japan

Australia

Hong Kong

Singapore

China

Philippines

India

Asia-Pacific

Net promoter score

(% promoters - % detractors)

0 1 2 3 4 5 6 7 8 9 10

Not at all likely Extremely likely

PromotersDetractors Passives

A good NPS is 20 or more, while zero is a “satisfactory” benchmark




Employees want personalised solutions – but not personalised

outreach

Note: Percentages indicate ‘Strongly Prefer/Prefer/Slightly Prefer’.


Tools

Offer tools that provide personalised suggestions on how employees can improve their

financial situation

MessagesSend personalised messages to employees facing important financial decisions

Employer should… It is not the role of employer to …

52%

35%

45%

60%

30%

48%

33%

25%

North America

EMEA

Asia Pacific

Latin America

22%

21%

36%

40%

57%

59%

37%

39%

North America

EMEA

Asia Pacific

Latin America


Highlights

Our research drives the agenda of Benefits Managers/HR throughout the region


Benefits matterEmployers recognise benefits as an important factor in attracting, retaining and engaging

employees. Nearly one third of employers are considering providing increased flexibility

Costs are a growing concernHalf of employers in Western Europe identify rising benefit costs as a challenge to delivering on

their benefits strategy.

Top priorities focus on plan design changesIn WE around two thirds of employers over the next three years will revise their plan designs and

strategies to better manage costs and to drive desired employee behaviours.

Technology use gains tractionThere’s growing interest in using digital approaches to engage employees around benefits. Also

an urgency around upcoming data privacy law changes that require technology solutions

Health is a competitive advantageEmployers are recognising that the user experience is key to make their health and well-being

programmes an important differentiator to attract and retain key talent. However, employers are

overestimating the impact of their well-being initiatives and need assistance to improve employee

engagement


Thank you

Francis ColemanHead of Health and Benefits

Global Services & Solutions


Kevin NewmanHead of Health and Benefits

Great Britain

Shannon BoyleHead of Health and Benefits

Western Europe

Modernising your health care programme...Source: 2017 Global Benefits Attitudes Survey Managing my...

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