Bridging the gap between plan sponsors and plan members
Wellness Spending Accounts (WSA) are the ideal solution to bridge the gap between what plan sponsors are interested in covering and what plan would use if they were added to their group health benefits plan.
2021 Benefits Canada Healthcare Survey
According to the 2021 Benefits Canada Healthcare Survey plan sponsors and plan members differ significantly on what they would like to cover compared to what members would use if provided. For plan sponsors they would like to cover 24-hour virtual care, followed by immunizations for infectious diseases and health risk screenings. Plan members would choose fitness classes, personal trainers and 24-hour virtual care as their top three choices of products and services they would like covered by their group benefits plan.
Health or fitness products?
Plan sponsors appear to be more interested in covering health-related expenses while plan members would use products more focused on physical fitness. Many of the products and services listed in the survey are not covered under any traditional group benefits plan and others would not even be covered under a non-taxable health spending account (HSA). An HSA covers substantially more healthcare related expenses than traditional group benefits plans, however even they have limitations and that is where the wellness spending account can fill the gap.
Wellness spending accounts – taxable benefit is worth it
Even though wellness spending accounts are taxable and will appear on their T4 or T4A there is still tremendous benefit to them. Clearly from the survey plan members would use wellness products if they were provided by their plan sponsors. The additional benefit to wellness spending accounts is that the plan sponsor can determine what they are willing and not willing to cover as an eligible expense. Thus, they can cover the health-related expenses that they want to provide as well as the fitness related benefits that plan members are looking for.
Wellness spending accounts can be the ideal solution for both plan sponsors and plan members when covering certain benefit expenses.