STARTUP DISRUPTING HEALTH BENEFITS PLANS
League Inc.’s wellness spending accounts create flexible support
Obamacare just might help Toronto-based digital health and wellness benefits startup League Inc. deliver on its founder’s goal to become a $1-billion company in 2018. League is already piloting its end-to-end benefits platform in Seattle with plans for a larger U.S. rollout this year.
League began here in 2014 as a mobile health and wellness marketplace where consumers could access accredited health practitioners. In January 2016, it pivoted to the underserved small and midsize business space, offering wellness spending accounts, before adding health insurance to the mix in October 2016.
The business expanded from Ontario to across Canada (Quebec will come onstream later this year), growing from 50 to 90 employees. The company will not disclose hard sales figures but does say it experienced tripledigit growth over the course of 2016. Plus, there’s CEO Michael Serbinis’s solid track record. A serial entrepreneur, he founded and sold DocSpace and Kobo for $568 million and US$315 million respectively. League raised $33 million in 2016 and partnered with RBC. Another round of financing is planned for this year.
The U.S.’s Affordable Care Act (Obamacare) gives businesses tax incentives to fund employee wellness programs.
Companies with fewer than 100 employees can also tap into a wellness grant to create a wellness plan — at least until and if President Trump repeals the Act. League believes tax incentives here would help employers provide usable benefits for workers.
The company is on trend in its focus on wellness and accessibility. According to The New England Journal of Medicine and the World Health Organization, up to 70 per cent of costs and 80 per cent of the incidence of chronic disease are preventable. Research also shows that upward of 80 per cent of employees want and expect their employers to help them manage their health. And 77 per cent expect their employers to offer a benefits plan that supports their overall needs.
“We believe there is tremendous opportunity to identify risk and proactively manage health and prevent chronic diseases and its cost,” says Lori Casselman, League’s chief health officer. “The workplace is a great vehicle to promote health and employees are looking for that support more and more.”
While health and lifestyle spending accounts are not new, Casselman says League’s platform is unique because of the amount of flexibility and customization it offers employers and employees, its comprehensiveness and the fact it is completely digital.
Increasingly, the health programs employees want go beyond traditional medical coverage such as eyewear or dental checkups to include personal trainers, physiotherapy and visits to osteopaths and naturopaths.
That’s been the case at Torontobased Powered by Search, one of Canada’s fastest growing full-service digital marketing agencies. Founded in 2010, it went through two health benefits providers before signing on with League in June 2016.
“We started with a traditional health benefits package. It was fine for people who had families but that represented only half of our team. The other half are people under the age of 30 and they weren’t using it,” says Matthew Hunt, chief marketing officer and vice-president of sales. “When we analyzed what we were paying as a company and what was being used, there was a big gap.”
Powered by Search surveyed its employees to find out what was important to them in terms of health and wellness. The findings led them to flexible health spending accounts, which afforded coverage for fitness programs and massages, among other wellness options.
“That was great but it was still old-school in that our tech-savvy employees had to do all this paperwork and submit it and wait until they were reimbursed,” says Hunt. That’s when the company found League, which offered even more flexibility and a completely digital platform.
“There is an online portal for the plan sponsor and the employee can use the web or a mobile app to do all their transactions with their plan,” says Casselman.
“It’s similar to the Starbucks app where you know how much you have left in your account. Users have a digital wallet and know exactly how much their employer has subsidized for each of the health and lifestyle spending accounts. It’s there at a glance in your pocket and easy to use.”
Another differentiator, Casselman says, is that League also offers health and wellness programs. These can take the form of virtual services such as educational webinars, online health-risk information and health-risk assessment tools, or on-site fitness, education and health-screening classes delivered by practitioners League has vetted. Employees also get regular tips, articles and push notifications reminding them to take care of themselves.
Like Powered by Search, Casselman says many of League’s early adopters are in the tech, professional services or advertising space. Employers can choose from a suite of products and pay a monthly subscription fee.
“The costs are comparable to traditional health benefits packages but because of the focus on the spending account component, which means the employer decides how much they will allocate into each employee’s account over the course of the year, there is less uncertainty around premium increases,” says Casselman.
“Today, everybody at Powered by Search is using the benefits and they are using them more than they ever have,” says Hunt. “They are healthier because of it, which is a good thing for us.”
The workplace is a great vehicle to promote health and employees are looking for that support more and more.