The role of employers in supporting mental health has evolved dramatically in recent years, and this shift has only accelerated since the pandemic. Alecia Henderson, senior vice president of Corporate Benefits at NFP, an Aon Company, highlights that while mental health was already a growing focus for plan sponsors before 2020, the events of recent years have deepened this conversation.
“Employees increasingly expect their employers to play an active role in supporting their mental health,” Henderson says. “It’s about creating a healthy work environment that’s not just reactive but proactive, addressing mental health holistically.”
Enhanced Coverage and Accessibility
One of the most significant trends in employee benefits is the enhancement of mental health coverage. Data from the Canadian Life and Health Insurance Association (CLHIA) shows that mental health benefits paid between 2019 and 2023 rose by an astonishing 120% — a higher increase than any other benefit category during that period.
While an uptick in claims might typically be seen as a concern, Henderson views it as a positive development.
“This growth shows that people are getting the support they need,” she explains. “The stigma around seeking mental healthcare has decreased across demographics, and employees are recognizing the value of accessing these resources.”
Plan sponsors are responding to this demand by reviewing their benefits programs, increasing coverage limits for mental health services and expanding the types of practitioners covered. Historically, coverage for psychology services often mirrored that of other paramedical benefits, with annual maximums of $300 to $500. With hourly rates for therapy typically between $100 to $200, these limits were insufficient for meaningful treatment plans.
“Many employers have recognized this gap and made adjustments,” Henderson notes. “They’re raising maximums and including more practitioner types to make care more accessible and affordable.”
Beyond Benefits: Policies that Promote Wellbeing
Beyond traditional coverage, employers are also exploring policies that promote work-life balance and holistic wellbeing.
“It’s not just about what’s on paper in the benefits plan,” Henderson says. “Time-off policies, flexible working arrangements and clear communication about available resources all play a critical role in supporting employees’ mental health.”
Employers are finding that effective communication is key. They may have robust benefits, but employees need to know about them and how to access them when they need help.
The Financial Case for Mental Health Investment
The financial implications of increased mental health claims are significant, but Henderson argues they’re a worthwhile investment.
“Mental health issues have long contributed to absenteeism and presenteeism,” she says. “By addressing these challenges proactively, employers can reduce hidden costs while fostering a more engaged and productive workforce.”
Mental health claims now account for approximately one-third of disability spending, with Canada Life reporting that 39% of short-term and 46% of long-term disability claims include a secondary mental health diagnosis.
The return on investment extends beyond cost management. Enhanced mental health benefits are a powerful tool for attracting and retaining talent, especially among younger employees. As plan sponsors navigate this evolving landscape, Henderson encourages ongoing dialogue with employees and benefits advisors.
“Mental health is interconnected with physical health, work-life balance and overall wellbeing,” she says. “Employers have an opportunity to make a meaningful impact by taking a comprehensive approach to benefits and workplace policies. It’s about meeting employees where they are and providing the resources they need to thrive.”
Ready to enhance your workplace mental health support? Contact us today to discuss how you can create a proactive, holistic environment that truly benefits your employees.