With group risk providers increasing their focus on supplying services as much as insurance, the imperative for making the case for rehabilitation and absence management has never been greater. Edmund Tirbutt finds moves afoot to do more to prove ROI
Group income protection providers are attaching such importance to their ability to provide added-value services on top of their core insurance proposition that some players are starting to pitch themselves as service providers as much as insurers.
But concrete evidence for the effectiveness of these additional benefits has always been conspicuously lacking and this hurdle must clearly be overcome if finance directors, and indeed government, are to be persuaded they will enjoy their required return on investment (ROI).
Jelf Employee Benefits head of benefits strategy Steve Herbert says: “As an industry, we should try and squeeze every piece of juice out of this particular fruit to demonstrate ROI. There is an opportunity now that we didn’t have a year ago to drive home the added-value parts as Fit for Work should be fully introduced by the end of the year.
“Because people off work for four weeks should be referred to this service, it will give employers a minimum standard of what they should be doing for employees and should therefore help people focus on actually intervening earlier, establishing what tools they have and how they can use them better.”
But the task of obtaining any suitable industry-wide data has always been greatly complicated by the lack of recognised standard definitions of rehabilitation or absence management, and some of the terms used by insurers can have a multitude of meanings.
Risk management consultancy Healthcare RM chairperson Pamela Gellatly recently tried to compare the major GIP insurers’ offerings for rehabilitation and absence management but found few opportunities to compare apples with apples.
Some providers used the term ‘rehab’ just for physiotherapy services while others reserved it for multi-discipline cases.
Gellatly says: “If it’s being provided as a free service to keep claims down it’s often just a bog-standard, limited level of physio and cognitive behavioural therapy.
“But some will go beyond that and look at more chronic physical and psychosocial issues. A lot of
people present personal conditions as clinical issues.
“Seventy-two per cent of over 2,000 musculoskeletal and mental health cases we’ve looked at have an under-lying condition associated with excess weight and inactivity. These under-lying issues are often not recorded or addressed by the clinical fraternity.”
Industry body Group Risk Development (Grid) has made a start in the search for meaningful ROI data. Its most recent annual claims survey, published this April, shows that last year 1,529 people returned to work before submitting a claim, having been supported by some sort of active intervention from their insurer.
Industry opinion is broadly positive about the new Grid development although most commentators invariably express the view that they would like more detailed data.
PSHPC head of wellness consulting Beate O’Neil says: “What Grid doesn’t say is how many requests put in are declined. Knowing this as well would help train HR to avoid referring cases that aren’t appropriate. It would also help if they could break it down into manual or non-manual work and tell us which group of conditions had the most impact.”
Grid chairman Lee Lovett, who is also head of business development at Munich Re, sees no reason why in future the survey should not be extended to include those who have benefited from insurer intervention after a claim has begun.
He says: “We are keen to try and move it forward but key challenges remain. Can we collect consistent, like-for-like data that we can aggregate at industry level and is there an important message that goes with it?”
As a sign of what may be possible, Unum head of vocational rehabilitation services Joy Reymond points to the analysis of the Australian market in Swiss Re’s Rehabilitation Watch 2014 – Australia. This found that for every $1 spent on rehabilitation services, insurers saved between $24 and $39 on income protection claim costs.
Reymond says: “It would be great to do something similar in the UK but I would prefer it done by an independent body such as a university or possibly The Work Foundation, which has affiliations with a number of universities with strong research focuses. A university would get something
out of it too by building its own research credentials.
“To do it, Grid would have to build its own research structure, although it could possibly partner a university.
“Unum has internal figures to prove that clients who engage in the rehab process definitely have shorter absence durations but, at this stage, they are not for publication. We are first looking for a way of telling the story without over-egging it and we are aware of the danger of lesser competitors publishing their own figures comparing apples with pears.”
Useful internal data is also in evidence at some intermediaries. For example, Broadstone benchmarks GIP providers via a basic grid shared with its employee benefit consultants. Providers are marked out of five in four categories: what is in place, whether it will deliver what it says, turnaround times and service standards.
Broadstone risk and flexible benefits consultant Robin Watkins says: “No single insurer comes out top across the board but the three strongest scorers are Unum, Canada Life and – for larger clients with a real appetite to do something about absence management – Legal & General.
“Our approach suggests that Grid and others could probably take benchmarking to a different level.”
Watkins notes also that benchmarking data is just one part of the overall communications jigsaw. In addition to providing communications material and getting insurers to deliver seminars, Broadstone has its own in-house roundtables at which clients discuss how certain issues should be tackled. It also stresses the importance of multi-level communications programmes because some
people react best to paper-based material while others prefer notifications via mobile phone.
Nevertheless, most of the cutting-edge developments in this field revolve around smartphone apps. For example, in March Aviva extended its Babylon app-based product for all GIP payments. This enables customers to book video or phone consultations with GPs and clinicians without the need to visit a surgery. Health-related questions can be asked via text message, prescriptions can be posted or collected from local pharmacies and symptoms needing further investigation can be instantly referred to specialists and diagnostic tests.
Aon Employee Benefits head of broking and proposition for health and risk Matthew Lawrence says: “The real innovation will come from the technology world and the support it offers individuals to live healthier lives and manage medical conditions when appropriate.
“The technology will need to be intelligent enough so that the data coming out of it is meaningful and has the broadest appeal. It will be interesting to see how the health and risk providers use this information.”
PARLIAMENT ASKS FOR GIP ROI DATA
In February, the Association of British Insurers (ABI) invited several group risk experts to address the all-party parliamentary group on insurance and financial services on the benefits of GIP insurance.
Accompanying Helen White, outgoing ABI head of protection, were Nick Homer, GIP manager at Zurich; Andrew Potterton, head of proposition development at Unum; and Julie Higman, IP product manager at Aviva.
It did not take long for the subject of ROI on rehabilitation and absence management to rear its head in Q&A sessions.
Homer says: “The committee told us they needed evidence of the value of rehab and, although we had isolated case studies, our case would have been much stronger if we’d had robust aggregated data. [This is the] challenge at an industry level.”