Transcript
Transcript: The Role of the Employer in the Future of Health Care
[00:00:00 Animated logo of Canada School of Public Service.]
[00:00:04 Caroline Pitfield appears full screen. Text on screen: Caroline Pitfield, Executive Faculty Member, Canada School of Public Service.]
Caroline Pitfield: Good afternoon, and welcome. My name is Caroline Pitfield. I am an Executive Faculty Member here at the Canada School of Public Service, and I will be your moderator for today's event, which is The Role of the Employer in the Future of Health Care. Before we begin, I would like to recognize that I'm speaking to you from the traditional unceded territory of the Algonquin Anishinaabe people.
I want to express my gratitude to generations of Algonquin people, past and present, as the original caretakers of the space that I occupy. I am very grateful to be here. Recognizing that people will be joining us from across the country, I do want to give you a moment to recognize the territory that you are on before we begin.
All right. Today, we have the pleasure of welcoming back Dr. Zayna Khayat, who's an Applied Health Futurist. Very cool job.
[00:00:58 Split screen: Caroline Pitfield and Zayna Khayat.]
Caroline Pitfield: Zayna is an Adjunct Professor of Health Sector at the Rotman School of Management at the University of Toronto. She's also a Health Futurist in residence at Deloitte, Canada.
Our format for today is as follows: Zayna will present for about 40 minutes on her work in futurism, specifically applied to the evolving role of employers in workplace health and the future of employee well-being. After her presentation, I will have the privilege of engaging in discussion with Zayna for about 20 minutes before we wrap up. Without any further ado, Zayna, I'm going to turn it over to you.
Zayna Khayat: Thank You, Caroline. Hello, everyone. So excited to be back. I think this is third out of three in a little bit of a future series.
[00:01:45 Zayna Khayat appears full screen. Text on screen: Zayna Khayat, University of Toronto.]
Zayna Khayat: The first one I think I did with you, well, maybe even two years ago, was on the future of health. We've talked about aging and other things. Now we're going to go even deeper on, what is the role of employers in the future of health and care of Canadians,
[00:01:59 Split screen: Zayna Khayat and title slide, as described.]
Zayna Khayat: in the context of a lot of things that are changing. I think of the public service, particularly the federal public service, which I believe is the largest employer in the country. There's a double role you play, both in setting up the policy regime to enable this evolving role for all Canadians, but also as a major employer, you can make a massive dent in the health and care of Canadians in your own little petri dish.
I think as many of you know, if you've been to some of these other ones, I guess they're my conflicts financially, but where I do my work in futuring,
[00:02:37 Split screen: Zayna Khayat and slide, as described.]
Zayna Khayat: are these logos across here. As Caroline mentioned, I teach in the business school here at University of Toronto. I'm embedded as the futurist at Deloitte. Most of my public speaking is through a speaker's bureau called Talk Boutique, and I advise two tech companies. One's called Teladoc Health Canada. They're a big virtual care company. And very recently, I joined a UK-based company called Quadrivia, which is one of the first medical AI agents. So, everything you see in the headlines about AI displacing what human care workers do, we're part of working on that. And I belong to an association of futurists. I'd love to connect, and many of you have on LinkedIn, so there's a little QR code there, but you can find me on the interweb.
And then some of my futures knowledge, expertise, really came from the first role I ever had, as a futurist, in a large, complex national organization, which is SE Health, St. Elizabeth Health. I built the Futures team. I draw a lot of my craft and my points of view on futuring from that role. I just wanted to acknowledge it.
[00:03:55 Split screen: Zayna Khayat and a news article, dated July 21, 1945, headlining the opening of Kaiser Hospital in Oakland, as described.]
Zayna Khayat: I don't know if any of us have ever stopped to reflect on the reality, in mostly North America, of why does an employer play a role in the health and well-being of the workers? Some of the origins go back to the mid-1930s, starting in America. This is a company owned by one of the barons, if you will, Henry Kaiser in the United States, where a corporation had to be created for a major, major infrastructure project. Think of building the Hoover Dam, or a railway, or an aqueduct.
In this case, in 1933, Henry Kaiser was doing these large construction contracts, and at a minimum, to meet obligations, and they had them back then in the '30s, around worker's compensation. You think in each province, we have some a worker's comp type board or a work safe board that any employer has legal obligations to meet needs, mostly to keep workers safe. Of course, he had that, too. In order to do that, he had to build some clinical capacity and an insurance scheme to protect the health of the workers because you imagine you're building an aqueduct, you step on a nail, not only do you need to deal with that urgent medical issue, but there's also risk in terms of the company. Building hospitals and stuff was part of those obligations.
There was one of the communities in California where one of these construction sites was happening – sorry, in Colorado – there was a very new physician, named Sydney Garfield, just out of LA medical school, taking care of 5,000 employees for the Colorado River Aqueduct, and realizing that his mission of his Hippocratic Oath as a physician was to do no harm and take care of people. But a lot of these employees couldn't afford his medical services, but he was still trying to take care of them. Lo and behold, his model, his economics of running, let's call it a clinic, couldn't work. He couldn't pay the bills and do the work. And so, he got together with Henry Kaiser because a lot of his patients, Garfield, were workers of the Colorado Aqueduct.
Then they said, how can we deal with this? They ended up levying a charge of about five cents per week to every employee that would go into paying for this hospital that Garfield had to run. Then the employer would put in about $1.50 a week prepaid from this workplace insurance scheme that they had, to give Garfield working capital. Really, that is how industrialized, insurance-based medicine started.
Then what it evolved to is, as they got better and better at taking care of the health of these workers in this the industrial medicine scheme, as workers started getting drawn into regions to build the Hoover Dam, or the next big project, they would bring their families. Mostly before it was single men coming to work. Now they had to add coverage, not for just the worker, but their family. Then it expanded that way in terms of the fees and the levies.
Then they were getting so good at building hospitals and clinics for these workers and their families that they actually formed what now became Kaiser Permanente, a health plan and a delivery org in 1945, that actually now could take any member who wants to pay into this plan, whether you work on a Kaiser project or not. Just to understand, those were the roots.
[00:07:50 Split screen: Zayna Khayat and slide showing the logos of GMC, Ford, and Chrysler.]
Zayna Khayat: Now, it got to a point in the 21st century, particularly because the founding was an employer-sponsored health insurance scheme in the US, and very little publicly funded insurance in the US, unlike in Canada, the state, through taxes or the feds, pay for Medicare for old people over 65, and Medicaid is their insurance scheme for people who have a very low income and don't work. They can't get employer sponsored.
It got to a point that the costs of taking care of the health of employees were starting to make a really big negative effect on the competitive ability of the corporation. This was a very famous quote. You imagine Toyota came into town to threaten these three known, iconic American auto manufacturing brands, and me being a girl from Windsor, Ontario, the livelihood of everyone I knew in my town was locked up in the health of these three companies, GM, Ford, and Chrysler.
The CEO of GM was saying, as soon as a car comes off the manufacturing line, we're already at a $1,500 cost disadvantage to, let's say, a Chinese carmaker, or a Japanese carmaker that isn't using their income to pay for health care costs of their employees. The cost of health care per car is more than the cost of steel, in this case. This is this space and why there's a lot of focus on this area in the US. In Canada, we don't have as much of those dynamics, but let's step back and understand the history of how employers came to be involved in aspects of both well-being, but also health of employees and health care.
[00:09:42 Split screen: Zayna Khayat and slide, as described.]
Zayna Khayat: Let's just assume workers' comp and safety has always been there because that was your license to operate in the manufacturing world. I'm not going to include that. Our origins don't go back to 1933, the way they did in the US with big infrastructure and construction projects, rather post-World War II.
You imagine everybody was out working to fight in the war. Women entered the workforce to fill up a lot of job gaps. Everything was getting rebuilt. Now, to be really competitive, and attractive to all the new industry forming, this became more of a company perk. It was some health benefits, dental, because we didn't yet have – reminder – we didn't have Medicare. We didn't have publicly funded health care, so everything was private. So, that's the origins.
I would say that – let's call it business driver for the employer – got even more prominent in Canada as it got better and better because we started to get towards publicly funded insurance. Then what does become the role of the employer if the big reason to attract and retain people isn't as dominant as it was post-World War II?
Let's keep going. We get into the '70s. As our population evolved, we had a very young, healthy population post-World War II. Big corporations were mostly the ones doing insurance in this way, but now they needed more from these benefits, so we started to get into disability management. If you hurt yourself, whether that's on the job or not, your worker will cover you because they want to get you back to work because we really needed these workers. Life insurance schemes were added. Then unions started to become more prominent for large parts of the workplace. They started to have a role in what is the total compensation benefit program, including employee health benefits.
Now we get to this modern area. This is not just large employers, all company sizes, including small, medium enterprises, including offerings now that can be available if you're a staff of four. They might not be with a big health insurer, but they're there. Of course, the mix of the needs of the health population, the age of the population, and the medical tools available look nothing like the '40s, the '50s, the '60s or the '70s.
Biologics come on the scene. Think of Remicade, think of Ozempic and all these. Public insurance came on the scene in Canada in 1984, we're just at 40 years. Now the role is really to supplement the public plan because everybody had universal insurance. The offerings became much more comprehensive than just, we're going to pay for your dental, and pay for maybe some long-term disability, and your drugs.
Then in the last five years, I'd say, Canadians are demanding and expecting much more than, my employer basically pays for my claims, like a bank account. They want much more flexibility. Some corporations have things like health spending accounts. Instead of adjudicating a claim, you as an employee or your family gets, I don't know, a $2,500 budget, and you decide what benefits you want to purchase with that.
Then, of course, especially post-COVID, two new services have really become almost mainstream: telemedicine, so on-demand access to physician-based care virtually, and a whole range of mental health services. The federal government, just to show an example of that, was probably the leader in this country to offer $5,000 a year of coverage for mental health care. You set the example, and now it's becoming table stakes. Every other next employer, including Deloitte, where I work, has started to add that.
Just to anchor us on what we're talking about, employer-sponsored health care, whether that's for wellness or treatment, depending on the company, costs about $150 per employee per month, up to $800 per employee per month on average. It can be up to 25% of your total compensation package in total, if you're using it a lot and it covers a lot of things.
This is where we're at. What we're going to talk about is where is that going to go next, given all the vectors of change in the future of health, which I've already talked about at the policy school, but also in terms of other vectors.
[00:14:45 Split screen: Zayna Khayat and slide titled "Future-back: 6 shifts in the Future of Health", as described.]
Zayna Khayat: So, a one minute, Cole's notes of the future of health, and if you want details, you can find other recordings and several publications I have on this. I organize it into these six areas, or design features, that have been the dominant paradigm for 50, 75 years of how healthcare is done are all up for grabs in the next 5 to 10 years.
The first is the timing of when do we actually provide healthcare services? Because the Canada Health Act says anything that is medically necessary must be insured and paid for by the government, so it shouldn't matter your ability to pay, or where you are. Well, if it's medically necessary, then by default, it's sick care. It's medical care, which means you have symptoms, and we need to either fix them, reduce them, cure you.
We have a very medical reactive model, and that can't serve us going forward. We will never have enough doctors, hospitals, drugs to meet the growing demands of Canadians in the way they're organized today, because the demand for that sick care, unlike a fairly young, healthy population we had when we designed all this, it far, far exceeds supply. I would estimate 2.5 to 10X demand versus available supply. Supply is fixed; it's constrained; it's very labour dependant; and it's financed largely through taxation. 70% of medically necessary care is from our taxes, and we can't tax Canadians anymore. We know that's a big topic these days. So, it has got to be preventative, proactive, and even predictive in the era of AI.
The next is how tailored, how personalized, how individualized, medicine and health is an individual endeavour. You and I, we could have the same diagnosis, but the way we address that will be completely different for a bunch of reasons. But that's not how healthcare has been designed. In the industrial model, the industrial era, it's one size fits everybody. In the business we call it a segment of one: very analog; very human and building-based; quite crude. We have not really brought intelligence to medicine because everything is locked into paper, and the data around care exchanges is not really captured anywhere.
That all shifts in the digital information era to being precise; intelligent; very personalized; configurable; pick a word. I often say we move from evidence-based healthcare to intelligence-based healthcare. This is a very different paradigm. Some say, we don't even have evidence-based healthcare, we have reimbursement-based healthcare. The only care that's practiced today is what's paid for. But there's a lot of great evidence of incredible stuff that isn't paid for. This is a big shift. I'll go faster through the others.
The channel, so the location, the modality through which we access services. We've had to have it very facility based. You had to come to a place: a clinic; a pharmacy; a lab centre; a hospital; a nursing home. We concentrated the experts at that place, and we time-share the experts and the equipment. You get one MRI if you've got, whatever, brain cancer. You get one lab test every three months if you have diabetes. You get one doctor visit, whatever it is. That's time-sharing labour and capital in a facility and visit-based paradigm. Those constraints go away in the future of health. It's really care anywhere, highly decentralized, and what I call "digical", this seamless play between the physical and digital realm. We basically were mono channel before, we're now omnichannel. This is a big deal for access, of course, for Canadians, but it fundamentally affects business models that have been fairly entrenched in a facility-based model.
The fourth is a duration. How much of a window do clinicians see into what's going on? Very episodic; very siloed; very visit-based; transactional. Now we're much more continuous, much more seamless, and it'll be bad medical practice for everything to be resting on a one-to-one relationship between a clinician and a patient. It's all about the team.
The fifth shift is the power of who's making decisions. We've had one agent, the clinician, usually a doctor, with their human cognition. Now, you and I, as patients, have much more say. I always say we're going to have 38 million healthcare CEOs, maybe 42 million, depending on the growth of Canada. We will go to the crowd and to our peers, and we will all have an agent, an AI agent, helping us call the shots. This is a very crowded power grid, and we've had a very paternalistic model for 50, 75 years.
Then finally, when we do all these other shifts, we change the currency, the payment model, what we measure, what we track from paying for stuff, for visits, for pills, for tests, we call that fee for service. When we have all the data, we can actually now pay for results, pay for health.
This is a very big deal because [the] value pool shifts. At Deloitte, we've modelled about 85% of where money is spent today shifts to these very different payment models. This is a big deal.
[00:20:38 Split screen: Zayna Khayat and slide titled "Present Forward: A public health system in transition", as described.]
Zayna Khayat: That's one big set of change. As I said, we have a very labour-based way to meet people's needs. In the 1950s, '60s, when we built all our healthcare systems – demand and supply – we were pretty good. But demand is going up because we have more people, we're getting older, we're getting sicker, we're getting fatter, and we have a lot more say. We want a very different experience in healthcare, and that is challenging the design features of the old system and so we're starting to get this demand. That's one reason why the role of employers in the health of their employees is going to change significantly and already has, I'd say, in the last five years.
[00:21:22 Split screen: Zayna Khayat and second slide titled "Present Forward: A public health system in transition", as described.]
Zayna Khayat: Some of the biggest pain points, if you will, that our healthcare systems – which, again, reminder, that's about 70 of all healthcare – employer-sponsored healthcare is about 15% of all of our healthcare in Canada, $360 billion. But this is my top 10, top dozen, big, big issues that our health system is contending with. The first seven around the workforce, around primary care, pharma care, they've been there for a very long time. We continue to work on them. A couple of others were always there, but they got way more important post-COVID around mental health and around equity. Then since COVID and now newer things, there are some new top 10 issues.
So, our poor healthcare systems are going through a lot and so that has implications. Coming out of COVID, all Canadians have a very new awareness of our health and the implications of poor health. Who got impacted the worst from this pathogen? People who were obese, or had cardiovascular issues, polychronic illness, the elderly. We're now seeing more and more data about disproportionate impact of poor health today on Alzheimer's outcomes.
So, [we're] way more aware. We have way less confidence in the public system, yet our needs are more complex. There is a rush of solution providers coming into the Canadian market to help make things better for Canadians. Those solutions are being offered both in the public sector, but now more and more in the employer-sponsored space. There are options, and you don't have to figure it out on your own in a way we didn't have before.
Then finally, in this era of everything is in a collaboration or ecosystem, there are these new boundary-spanning roles for employer-sponsored health to work with the public system. And they were quite apart for the last 70 years. That's one driver.
[00:23:22 Split screen: Zayna Khayat and slide titled "Canadians consume health care in 4 ways", as described.]
Zayna Khayat: The other is that workers, as employees, their needs for health and wellness themselves are changing, agnostic from the pressures of the public system. If you think about any one of you on this call right now, if you need either wellness services to prevent you from getting sick, or health care services when you have symptoms, you're technically accessing them in one of four ways.
The first, like I said, is as patients, when you go to your doctor or whatever it is. The next is as employees, as we've talked about, through these employer-sponsored benefits and insurance and disability. But the last two are as a citizen in Canada. As a consumer on your own, independent of what your employer is offering, or the health system is, you can go buy services. You can pay for a massage. I'm currently paying out of pocket right now for menopause care because I'm not getting my needs met through my employer or through the healthcare system.
You could buy an app online and pay a subscription fee for a sleep thing, or I don't know what.
Then the last one has been interesting that exploded during COVID is when you're a customer of another business, let's say you're going to shop at Best Buy, or you're going to Tim Hortons to get a coffee, especially during COVID, businesses are starting to offer health services to their customers, which is really interesting.
Now you think of yourself as an employer. Remember Kaiser, that company that built aqueducts? They started by offering health care services and an insurance scheme to their employees and their families, but then they built it as a business for anybody. We're starting to see corporations, if they're going to take care of their own employees anyway, can they offer some benefits to help take the pressure off the public system? I'll get into that.
[00:25:44 Split screen: Zayna Khayat and slide titled "Future of Work is re-basing", as described.]
Zayna Khayat: The last why, of why it's a good time for the policy school to have a conversation about employers and health, is because work is changing. This is Deloitte's framework. Everyone in the world is figuring out what is the future of work because we're emancipating from an industrial era around jobs, around employers, et cetera. So, if work is changing and every worker is going through a thing, then, of course, the benefits and the health programs and services are going to have to evolve.
[00:26:15 Split screen: Zayna Khayat and a series of slides featuring releases from Deloitte, as described.]
Zayna Khayat: At Deloitte, we did a few papers reimagining what could it look like. We put some big, bold numbers of if the employer now became a major vector for the longevity, the well-being, and the health of employees, what could the world look like, instead of having this passive role, particularly in Canada that we've had?
Some papers, if you want to get into it, at Deloitte, we went quite deep in Canada with primary research. We talked to 1,500 Canadians about how are your needs being met or not in your employer-sponsored health care? Some of the things we heard: I'm sick of having all these lives across the public and the private; I don't know what is the right resource to trust; It is not enough that my employer gives me a website to access 100 articles about diabetes. What do I do with that; I'm struggling because I can't get access to specialists and care when I need it; I'm being bounced around like a pinball with all these different meetings, and specialists, and appointments, and tests. Help me with that; I need stuff that's relevant to me for where I'm at versus the same information that everybody gets to see; Hard to understand options, and I'm losing trust in the healthcare system.
[00:27:45 Split screen: Zayna Khayat and slide titled "Result: employee health benefits landscape in Canada is shifting", as described.]
Zayna Khayat: From that, what we've been guiding a lot of employers and health insurance plans that employers basically outsource their benefits management to, to these are the big changes that how are you adapting to? How are you adapting to very different needs and preferences of your mix of employees? Not only is it that if you're a company that maybe most of your workers are – I don't know – truck drivers or construction workers versus teachers, versus policymakers, that those are very different needs. Why would you give all of them the same benefits program if you're, let's say, working with an insurer?
But within the workplace, we now have six generations in the workplace. Six. We've never had that in the history of the country. There's no way a 20-year-old, what they want out of their health benefits plan is anywhere close to a retired, or post-retired, as you know, a lot of your health benefits from an employer continue into retirement.
The landscape of who can provide incredible solutions for employees is intensifying. And so, to be relevant, both as an employer in terms of what you offer so that you attract and keep talent, but also your insurance scheme, if you're using one, they need to stay on their toes in a way they haven't been before.
The business model is no longer working. Basically, you're going to, let's say, go do massage, bring your claim, and we're going to adjudicate and pay out your transactional claim? [That's] not working in terms of the goal of maintaining health and restoring health if you get unwell. The experience has been brutal for employees, so all the operating model is evolving.
Then finally, of course, the regulatory landscape that informs what an employer can or can't do, and how and what an insurance company does, are going through evolution, as they should. Particularly as we challenge some of the aspects of the Canada Health Act and privacy.
[00:29:56 Split screen: Zayna Khayat and slide titled "Employers asking for clear ROI from their benefits investments", as described.]
Zayna Khayat: Just some examples I'll share of how this is playing out, and then Caroline will get into some questions. One way this is playing out is more and more employers are saying, if I'm going to contract with so and so to offer mental health services for my employees, or whatever, one, I want to see the ROI. I don't want to just pay for a bunch of benefits and wonder. So, very different business models and very different expectation of employers of the value they create. I'll just give an example.
In Japan, they were worried about obesity growing and, actually, the Japanese government made a legislation, a regulation, that the employer has to help tackle obesity in the workplace. So, it wasn't the employer on their own saying, I'm going to do this because it's good for my employees. But if you had a certain proportion of your population below or above some kind of a BMI, you were going to pay some penalties to the government. So, really interesting.
And the same, we're starting to see in mental health in the workplace, given the impacts of burnout, stress, and leave, that it's not enough just to offer benefits. You got to go a little bit above. There's been incredible work in Canada done on this with the roundtable on mental health in the workplace and much more.
[00:31:20 Split screen: Zayna Khayat and slide titled "4 Evolving Roles for Employers/Health Benefits Providers", as described.]
Zayna Khayat: We're seeing employers, and this was in our Deloitte paper, start to really evolve their role, from just offering a suite of benefits to everybody, to going deeper on one of four roles, health navigation in the top right. Offering a service to help you navigate and fill all the gaps of all the pieces that you need to manage in the private and the public. Some are getting into actually delivering and building health products themselves, instead of outsourcing it to somebody else and then offering it.
Some are getting big on data. A lot of insurance companies that employers contract with, they are incredible at data. Can they bring that capability and help the health system with a much better view of the full data picture of employees? Then a few, like Greenshield in Canada as an insurer, and now Sun Life, that cover millions of Canadian workers through employer-sponsored insurance, are becoming what we call a "payvider". A provider of health care services and a payer, an insurer. That has been a pretty new thing on the scene in Canada, where they don't only support services, but they actually employ care workers and deliver some of those services.
[00:32:40 Split screen: Zayna Khayat and slide of home page for "transcarent", as described.]
Zayna Khayat: So, [an] example of a health navigator, if you want to look at more, look at "transcarent" in the US. It's literally a service for employers to offer to employees to navigate you through all the myriad issues you have in health care.
[00:32:54 Split screen: Zayna Khayat and a series of dispatches from "blue california", as described.]
Zayna Khayat: In this "payvider" space, the big areas are mental health; wellness and prevention; chronic conditions; physical mobility; pain; musculoskeletal health; tonnes going on in anything around sexual health; women's health; men's health; gender-affirming health; and a lot more focus on family caregiving. I'm a worker and I'm taking care of sick parents and their needs of seniors' care because the health system is struggling. The example here is a big announcement two weeks ago that Greenshield, an insurer, and a home care organization, SE Health, now have an offering for workers who are family caregivers. That's the first in Canada at this scale. Sun Life did another interesting one for Canadian workers around grieving. So, your parents are going to die, or someone you know, can we offer a much better benefit for that?
[00:33:56 Split screen: Zayna Khayat and slide, as described.]
Zayna Khayat: In terms of data convener, I like "hi". Again, I think this is in Sweden, but they've kind of tried to be, they call it one digital wallet. Whether you are paying for stuff yourself, getting stuff through your employer, doing stuff in the public system, how do you have one view of all that for the data and the money? I think that's going to have to come to Canada
[00:34:19 Split screen: Zayna Khayat and slide titled "New solutions for employees", as described.]
Zayna Khayat: And then lots of new solutions of employers and insurers around new products. So, rethinking risk managing around really, really expensive drugs. Some of you might be trying to get some of these new biologics for obesity management. The old way of doing a drug plan doesn't really work for the new class of drugs, so that's being looked at. Companies like in Canada, Equitable Life for Employees, partnering with remote monitoring and wearables, virtual reality being covered, et cetera.
[00:34:51 Split screen: Zayna Khayat and slide titled "Payment/pricing/incentives innovation", as described.]
Zayna Khayat: Then probably the one that is slightly here in Canada, but not nearly like the rest of the world, is Vitality, which is a way to incentivize workers that if you do the things that are consistent with health, around walking, around not smoking, and around not drinking, you can get points like a currency, and you can use those points to buy things that you care about. Whether that's a sofa at Wayfair, more coffee at Tim Hortons, or in the case of United Health care in the US, maybe if you do these things that are consistent with health, you actually get cash added to your health benefits plan. In this case, you can get $1,000 added to your health spending account to buy more things that you want to make yourself healthy if you do these five or six things that are measurable.
So, lots of neat things there. The one I get the most excited about, what we're starting to see back to ROI is, imagine as an employer, you want to maintain a healthy body weight of your workforce and help them avoid diabetes, or reverse diabetes, there are some solutions you can now contract with that only get paid when they reverse diabetes, in the case of Virta, or if they reduce weight. Instead of paying for the obesity management drug, as the insurer or the employer, you're paying for the result.
[00:36:18 Split screen: Zayna Khayat and slide titled "Business for Health", as described.]
Zayna Khayat: So, lots of cool stuff. I'll just end with there's a lot more movement of the role of workplace employers, and let's call it business on health. I think it's just a very timely conversation. But of course, they don't do that in a vacuum. If you're an employer, like say, the public service in Canada, federally, you don't just do all this work for your own workers. They are bleeding into, what does that then mean off that platform for consumer health, so all Canadians, and for community health.
[00:36:51 Split screen: Zayna Khayat and slide titled "New entrants developing compelling value propositions to employees and employers", as described.]
Zayna Khayat: More and more, we're seeing companies who touch a lot of people because of the services, like Walmart or Apple, starting to now bring services, solutions, and products to all their customers for their health, agnostic of whether or not they're employees, et cetera. Apple is one.
[00:37:09 Split screen: Zayna Khayat and slide, as described.]
Zayna Khayat: This is the founder of Walmart, Sam Walton, way back in the '90s, saying, "As Walmart, we've got to start nipping in the bud the high, high cost of American health care for our employees, yes, but also for our customers."
[00:37:25 Split screen: Zayna Khayat and a Forbes article that reads: Walmart Announces Ambitious Goal: "To Be The Number One Healthcare Provider In The Industry." ]
Zayna Khayat: And that's what they did. They moved their strategy from, we're not just here to save you money. We're here to help you live better with some pretty lofty ambitions.
[00:37:33 Split screen: Zayna Khayat and a large collection of the logos of major North American organizations.]
Zayna Khayat: I collect logos of all these organizations that you would have never thought they're in the health business, but they are. Here's just one collection of them that are producing solutions for people.
[00:37:47 Split screen: Zayna Khayat and slide titled "What is the future role of employers in Canadian healthcare, as previously described.]
Zayna Khayat: So, that's what I wanted to talk about. Let's get into, okay, where does this go next? So, Caroline, back to you.
[00:37:54 Split screen: Caroline Pitfield and Zayna Khayat.]
Caroline Pitfield: Thank you, Zayna. There's so much to think about there. Fascinating, fascinating. It's fascinating, particularly actually by the historical roots of all this. Throughout this sense that on one hand, these programs should be win-win, but on the other hand, it toggles between two different ways of seeing it.
On one hand, it's an employee perspective, in which case the employee has some influence over what maybe they get. On the other hand, it's capital maintenance. In this case, the capital is human capital, in which case maybe it's a little more tied to employer needs, or operational needs. Those different perspectives, I think, have an impact on what's offered, what the impact is, and how we measure effectiveness.
My first question, I was going to ask you to talk a little bit about that, maybe from the particular point of public service organizations. But how do you balance the employee well-being piece with operational demands, ensuring that you've got workplace health initiatives that are effective and sustainable in the long term, but also recognizing those two different perspectives, the employers and the employees?
Zayna Khayat: I think, as I mentioned, one of the big shifts has been that employers are demanding a better, let's call it ROI of these incredible investments. Like I said, it could be $200 to $800 per employee per month that you could be spending on a lot of other things to achieve your operating goals. I think that's it.
As an employer, especially in a public sector organization, you're not seeing – it's a line item, you see it every day – but you're not seeing the upside, then it behooves you to look at these trends of how others are rebasing their program that are getting those short term results for both the delivery of the operations, but also the workers' needs and setting up for the long term.
The other point I'll make is we know healthy people do amazing things. If you want to get the most amazing things out of your people and use that mindset, that's actually how you're going to deliver on your operational goals. It's a very different orientation from risk management, which is if an employee gets sick, I want to help them get better so they can come back to doing the job they used to do. No, that's like getting your baseline back. Now, it's like, how do I maximize the health of my people to do amazing things? That's a much better position of strength, instead of starting with a position of deficit.
Caroline Pitfield: Yes, I think that's especially the story we've seen with mental health benefits, recognizing that if we don't invest in mental health then we don't have the best workforce we could have. We've seen that shift, I think, quite strongly over the last couple of years.
Zayna Khayat: Yes. Actually, that's a perfect example of everything I just said.
Caroline Pitfield: It's been very real. I was really struck by that, too. The employers wanting a clear return on investment. I'm thinking sometimes in the public service, in some ways, our employer is the Canadian public, and they likewise want to feel that money that goes into our benefit packages or our salaries is a good return on investment.
I wonder, too, about that, indicators in public service organizations, what we should be using to measure effectiveness in our workplace health initiatives?
Zayna Khayat: I'll tell you what's used today, because I know one of the companies I work with, we provide solutions to many public sector organizations, either directly or indirectly through insurance. These are the typical ones today. You know, literally dollars spent on what? And a reminder, about 70% of the total budget spent on employer-sponsored health care is drugs, so you're literally adjudicating claims. About another 10-20% is dental care, and maybe those two, the distribution might change a little bit if the federal programs get to scale. Then the last 10 or 20% is everything else. Massage, telemedicine, mental health services, Health Spending Wallet. So, that's what they do today. To me, that's not a very good indicator. It's easy, but how do you know if it's working?
The next layer that some use is, we call it utilization. How many of your employees are actually using these benefits as a % of the total? Then if they're in and using them, what's the stickiness? We call that engagement. Let's say you offer $5,000 of mental health supports, and maybe 10% of your population took advantage, but most of them did something once. Are you going to really get the full benefit? That's another one, the next layer.
Then, of course, the last one that's very standard is if it's more of a long-term disability or short-term disability, we have a very clear metric called return to work outcomes, and you do want to get those back. But I'll tell you, I don't find much aggression in terms of making those return-to-work outcomes better than they are. I know people who are off on leave for months and months because the employer is waiting for the public system to make that person better, and it [isn't] going to happen. So, we're starting to see a lot more innovation on a stronger ROI expectation on disability management.
What's next, though, to me, is actually – like I showed some of those examples – actual outcomes. Imagine if I'm going to pay for a prescription drug program, how do I only pay if I get the results that the drug purportedly offers? If I'm going to offer a mental health program, let's say cognitive behavioral therapy or something like that, how do I only pay based on depression scores objectively going down?
Then some of our more pioneering employers are now starting to include a metric, in the business we call this NPS, Net Promoter Score. Which is, let's say you're an employee in the public service, you used one of the programs or services offered by your employer for your health and wellness. You survey them at every touch point of, would you recommend this service to another colleague? And if you're not getting the top two boxes of, I want to say 60, 70%, is it a good service? And Health care, anyone want to guess what the NPS of most health care services is? 34%. It is abysmal <inaudible>.
Those are some of the new indicators, I'd say that I would encourage some leadership of any public good, but especially a massive employer like the federal service.
Caroline Pitfield: Yes, really tricky, though, because when you're recommending a service, are you recommending it because it actually had a good health outcome? Or are you recommending it because, as you say, it was easy touch, it worked really effectively. I was able to put the claim in really easily. Sometimes it's not the therapeutic value, it's the ease of the thing. Then the other challenge, I think, is sometimes that overlap between, especially when we're looking at mental health, employer performance, good leadership, is it a nice place to work and return to office? There's that overlap, too, that can be very tricky to manage.
Zayna Khayat: To me, that parallel, again, going back to how we got workplace safety, workplace insurance compensation,
[00:45:32 Zayna Khayat appears full screen.]
Zayna Khayat: safety was a big version of health because we were building things and stepping on nails. Mental health is now the version of that. The lines start to be a little bit more grey.
[00:45:42 Split screen: Caroline Pitfield and Zayna Khayat.]
Caroline Pitfield: Absolutely. With the evolving work, the reality of work that you discussed as well, that makes it even blurrier, I think.
Zayna Khayat: Yes, I agree.
Caroline Pitfield: So much. All right. From your perspective, what are the biggest challenges for us in making these workplace programs effective? How can we address them?
[00:46:02 Zayna Khayat appears full screen.]
Zayna Khayat: Again, you as an employer, how are you maintaining health of your workforce and restoring health if it goes off the rails? Everything that I just talked about, all those examples of playing these evolving rules: data convener; payvider; health product developer; and navigation in those areas I talked about that are the gaps that is a perfect space for employers to fill. Women's health, and sexual health; chronic disease; musculoskeletal health; elder care; etc. So, is what you're offering reflective of these needs that are the current needs?
The next layer, though, to me, is how do you reinvent, let's call it the business model or the model of how you're doing employee benefits, in the context of the bigger health system? Can there be better partnerships to either fill the gaps of the public system, or bridge those two systems so that it's continuous for your employees?
Imagine if we just put everything into one wallet instead of these other wallets. Can there be some leadership from employers? Some are looking to do this if they're big enough and they have the scale. Again, what's beautiful about the public service, the federal, is you have scale and you're every part of Canada.
Then two other ideas. Another area we're seeing leadership of the employer is, let's get out of wellness and care, to much more upstream of what are the determinants of health. Some are starting to move into those root cause things around what you eat; your sleep; how much you move; stress; substance use, like smoking; and then even upper stream: poverty reduction; digital determinants and commercial determinants; health literacy. These are very new levers that are not adjudicating medical claims.
I'm just going to give you one example of an employer that does this. Has anyone ever heard of WHOOP? W-H-O-O-P? It's one of these sleep health companies that has a tracker that, again, would sell that service to an employer as a thing to offer their employees. It's one of these – I said there's a big flood of new solutions coming to the market. They're not yet in Canada. Well, as an employer themselves of a high-growth company, they put their money where their mouth is. As an employee – they have to make sure the stuff they're selling works on their own people – so, as an employee, if you have poor sleep health five days in a row, you get as many days as you need off fully paid, until you get your sleep health back to a good thing.You might say, oh, wow. What if my sleep health is great? Do I get a bonus? No. But they're not going to penalize you.
So, that's an example of really designing a benefit around an ROI, that we're going to guarantee an ROI of the sleep health program. In this case, it's because then they can use that to go sell it to other places. That accountability is very new in this landscape.
[00:49:17 Split screen: Caroline Pitfield and Zayna Khayat.]
Caroline Pitfield: At first pass, I was like, I would totally take that extra day off when I don't have a good sleep because it happens quite frequently. But then I also started to think, would I fear being judged on my bad sleep? Would I fear that down the road, they were looking at me and saying, Okay, not a great employee, she doesn't sleep well enough, and that that might be a risk.
Which, to me, relates to this question about data because I'm 100% with you in terms of collating data and making it easier for people to own their data and navigate the data, but there is also that fear, I think, on the employee side.
Zayna Khayat: I think everybody wants to say, oh, I don't want my employer to do a genetic test to have access to that data, which, by the way, because the public sector in Canada does not pay for whole genome sequencing, whereas leading health systems around the world, absolutely, they do a whole genome sequence on the whole population. It just makes good sense.
Anyway, so now more insurers and employers are paying for it for some cases, let's say, certain drugs, just literally. If me and you, Caroline, had the exact same disease, in my biology, certain drugs would never work in my body, but they would work in yours because of what you and I got from mom and dad. But then people are like, oh, no, they can't get my genetics. They're going to use it against me.
So, I think we want to go there. There is no evidence, I've never seen it, of an employer ever penalizing you for trying to work on your health. It's always incentives, but never disincentives, ever. Another big example, I showed you that vitality example and the United, where if you walk a certain amount a day and stop smoking, all it is, is upside. It's not the intention, that's not what we're seeing. I see how you'd be worried about it, but it has not played out anywhere that I've seen. Absolutely.
Caroline Pitfield: It goes back to that intersect between our health and well-being and our performance at work and how we're evaluated and what we fear we've offered and how we fear that will be judged or interpreted.
Zayna Khayat: I understand the fear.
Caroline Pitfield: We've talked about the public service as an employer, a big employer with big health care programs it manages, but we play the other role as well,
[00:51:25 Caroline Pitfield appears full screen. Text on screen: Caroline Pitfield, Executive Faculty Member, Canada School of Public Service / Caroline Pitfield, Membre-cadre du corps professoral, École de la fonction publique du Canada.]
Caroline Pitfield: which is lead for health policies and other policies in that federal space. Before we need to leave, I wanted to invite you to reflect on that. What can we do at the federal level to help all employers make this a better reality for all Canadians?
[00:51:45 Split screen: Caroline Pitfield and Zayna Khayat.]
Zayna Khayat: I think there's an agenda item that's literally live right now, which is around what is the grey zone of the Canada Health Act,
[00:51:53 Zayna Khayat appears full screen.]
Zayna Khayat: of what legally must be provided by the state versus what could be optional, whether it's employer-sponsored or not, but there are some grey zones that are not clear. I don't know that certain guidance that came out recently, I think it made it as clear as mud, to be honest.
I think just, again, making sure the policy agenda of what should be covered by the public is staying relevant for the times. I personally think the Canada Health Act needs to be opened up completely, but that's just a nonstarter of a conversation. I'd be looking for some courage of policymakers to be ahead of that.
I think, too, a few other areas, obviously, as dental care evolves, pharma care, which are the two biggest line items, remember, 80, 90% of employer-sponsored health care. How are we managing that transition? What does that look like?
Then one next policy area, I hope one day in an election will be the next version is Universal Seniors' Care. One in five Canadians are over 65 this year. This has never happened. We cannot account for a sick care system that's based on hospitals and doctors to keep our moms and dads and families healthy. What is the federal role in that? It's been talked about ad nauseum. I've not seen much action.
Two other areas: I'd love to see some federal leadership on policy. Deloitte has modelled about 40% of Canadians will be working in the gig economy. I'm a gig economy worker. I don't work full-time for anybody. Working full-time for 30 years at one job is an artifact of the industrial era. How do we evolve the landscape so that this mix of public/private works for everybody in a gig economy, I think needs a lot of policy work because it will be the dominant labour paradigm, not the minor one.
Then finally, there's some rumbling around an alternative benefits plan, which is a bit linked to the Canada Health Act, but we're the only country in the world that has universal, publicly funded insurance. Everywhere else, there's an option for me to buy out of that and buy into an alternative plan. What's that policy agenda, and how do we introduce that? I actually think that might at least future proof us to be able to absorb these shocks and dislocations that I just told you are coming in the future of health and the future of work.
I didn't even talk about AI and work. I just think we need to flex everything. Policy helps you take, I think, very static infrastructure that we have, whether that's policy infrastructure, and give it a bit more moldability to absorb these shocks, and I would look for that kind of leadership.
[00:54:33 Split screen: Caroline Pitfield and Zayna Khayat.]
Caroline Pitfield: Not a small to-do list you've given us. The overlap of old age care and gig economy alone is a big challenge. But yes, thank you for that. Definitely a lot of work to do. We're almost at time, but I wanted to give you an opportunity to reflect on all you said, to give us maybe the one key next step you'd like to see us do, either as employers for the federal government within that construct, or as leaders in the policy space. Either a key next step, or a key takeaway from you, an opportunity to share what you haven't shared yet.
Zayna Khayat: Yes, maybe just a call to action with the two lenses you just said.
[00:55:19 Zayna Khayat appears full screen. Text on screen: Zayna Khayat, University of Toronto.]
Zayna Khayat: I think as the biggest employer in Canada, launch a bunch of experiments. To me, you should be the petri dish in the lab of these next generation things that all the changes I just talked about. Pick one area and go for it. Kind of like how you did the $5,000 a person mental health, that broke a seal. I just listed 15 other areas you can do this in, so do more.
Then I think as a policy platform for the country that touches everything, every file, every province, like I said, pick a couple of those areas that are affected because of the future of work, and the future of health, and play around, again, like a lab with what could be the next policy regime to future proof us. I listed some ideas. I think those two would go a really long way to getting us ready.
[00:56:14 Split screen: Caroline Pitfield and Zayna Khayat.]
Caroline Pitfield: Well, thank you for that. I was going to say off the top, you work in two areas that are near and dear to me, strategic thinking or strategic foresight, and healthcare policy, two areas that I've loved throughout my career. This was a real pleasure for me to have this short conversation with you. I hope we have the opportunity for our paths to cross again. But I do want to thank you on behalf of everyone, federal public servants watching, the Canada School of Public Service, for a wonderful presentation today.
[00:56:47 Caroline Pitfield appears full screen.]
Caroline Pitfield: And I invite those watching us to check out the website or the platform for more offerings from the Canada School of Public Service. But thank you very much, Zayna. That was wonderful.
[00:56:54 The CSPS animated logo appears onscreen.]
[00:56:58 The Government of Canada wordmark appears.]
