The fine line of “Use it or Lose it” when it comes to your Group Benefits Plan

This time of year, we are receiving notices from our dentist, optometrists, and other healthcare providers reminding us that our benefits plan will renew in January.  They advise us that since we are paying for our benefits, we should maximize our usage to ensure nothing is left over as the funds will not carry over into the New Year.  They say “use it or lose it”; however, there are a few things you should be aware of with this way of thinking.

If you pay a premium towards your benefits plan it makes sense that you would want to get your money’s worth out of your benefits.  You have paid for the benefits so why not use them?  You absolutely should if your healthcare provider has suggested or recommended treatment.  The main concern is with excess or unnecessary utilization of the benefits plan.

You should keep in mind that your insurer will review claims experience during your annual Group Benefits plan renewal and if claims are high the premium rates may increase.  When a program has seen a significant amount of utilization in dental, vision or paramedical coverage (such as massage, chiropractor or acupuncture), the annual review of premium costs will typically result in an increase of premium costs. When an employer considers their budget and overall compensation costs, benefit plans are often reviewed and modified to reduce costs.  Employers may look at lowering benefit maximums, adding a referral requirement, removing certain benefits or adding a per visit maximum as a way to contain costs.

Employers should educate their employees on the advantages of maintaining a healthy lifestyle and how to best use their benefit programs.  Employees should be encouraged to be smart consumers, ask questions, shop around and compare service providers.  Employees should know that they play an active role in maintaining an affordable group benefits plan.

Renee Buchwald / Benefits Specialist / PEO Canada

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