Building A New Employee Benefits Agency
As a 34 year veteran of this industry it sure doesn’t feel like I am in the same business today.
In 2008 the insurance plans for the hundreds of small group clients we served (along with many larger groups) stopped paying our company a percentage of premiums. We suddenly received a per employee per month fee and with the layoffs happening at the time, revenues began to plummet.
The environment of increased annual commissions came to a sudden halt so growth only came by selling more clients.
At the same time, the competitive environment was heating up as advisers (some with knowledge and some without) started giving away free stuff like cobra administration, benefits enrollment technology, human resource services and wellness consultants to attract customers.
Even though we were no longer getting raises annually unless we sold new business…..the “rate shopping wars” continued with one broker after another touting their ability to get a better rate because of their status with the carriers.
It took me a while but I eventually found my way to a business coach and coaching group (notice I didn’t say a benefits advisory group even though that is important too) to help me understand what to do to grow again.
I discovered it isn’t what is going on outside that matters…it is mostly what is going on inside my company. Why do we exist? What is our purpose? What is it that I am trying to accomplish with my chosen work? Why does it matter? Does the team know our “why” and understand? Why do they work here? What is it we stand for and mostly…what is the client in desperate need of?
So I recognized my calling through this process….we know this business and we can provide plan design solutions that work and that our competitors often find too difficult to explain, implement or understand themselves.
We also have created great internal processes to deliver a consistent and efficient but effective experience for the client that we constantly strive to improve.
By participating in a coaching group with other non insurance companies I learned the single biggest differentiator of any successful business is orientation to process.
Also concern to meet the client’s needs with integrity is critical. This means always creating recommendations based on what is best for the client, even if it isn’t the most profitable solution for us. Integrity can often be hard to come by in the insurance world, but we have built our company on this behavior.
Integrity itself doesn’t work if not paired with dedication to be students of the industry. We must be constant learners who share a willingness to adapt and change quickly to adopt new ideas and proven solutions to bend the cost curve. This is what the client pays a benefits adviser to bring, along with electronic enrollment solutions, compliance solutions, data analytics, a strategic plan and a service experience that is second to none.
And then there is discipline to a sales process and constant sales activity…nothing happens without this.
So now our company looks more like a professional accounting firm or law firm or management consulting firm than an insurance brokerage.
We have great expertise in all welfare related employee benefits. It is a narrow focused area but we have mastery in our arena. We focus on providing value so we can be the one to be awarded the advising contract. And when we do our services don’t come at the lowest cost. We provide expertise and help our clients create a plan that works to attract and retain the best employees. They will pay us our consulting fees when they understand the value that comes with that. This is our purpose.
Glad to have my team around me to encourage and embrace the investments we are making to attract the customers we identify and want to work with. I am not waking up as often in the middle of the night as I get more comfortable with the decisions required to grow.
Suzy K. Johnson
We all know that the cost of Employee Benefit programs and especially health insurance has risen to the point where companies are now managing costs from the C suite in conjunction with HR.
Not only is it important to focus on providing great benefits but also management of costs. It is critical that value be maximized.
All CFO’s like to understand their Return on Investment whether it be the implementation of a new benefits technology/administration platform or implementation of a consumer driven health plan.
This is where a written strategic plan can be helpful. A knowledgeable broker can use historical data to project future cost increases and recommend strategies through plan design to level out the trajectory of these increases while being ever mindful of the need for the business to maintain a robust plan offering that attracts and retains good employees.
This allows the business over a specified period of time, to achieve a more cost effective plan that evolves the behavior of employees to a more consumer driven approach (“skin in the game”)while informing them of what is ahead and helping to educate them to be prepared for future plan changes.
Rome wasn’t built in a day and likewise, most employers find it difficult to make dramatic changes to the benefit programs without providing significant education and advance notice. A plan can serve as a roadmap that can be shared with employees so they can be engaged in helping the company achieve long term cost control goals with the assurance the company is not going to throw them under the bus or abandon them.
In short, the long term plan sets the stage for change implemented over a specified timeframe based on employee involvement and trust between all parties. A “Win/win” for all.
Suzy K. Johnson
President and Owner EB-Advisors of the Carolinas, LLC
Why High Deductible Health Plans with Employer and Employee HSA Funding Can Drive Change in Employee Behavior.
Why High Deductible Health plans with employer and employee HSA funding can drive change in employee behavior and why it is our (brokers/advisors) responsibility to education, position, recommend and implement these types of plans with our employer clients.
December 2003 was a great day for health plans in America. This was the date that High Deductible Health plans and the underlying Health Savings Accounts were enacted into law by the federal government.
With this law we were provided the ability to engage employees more directly in the cost of their care with the elimination of copays and RX cards under these plans.
What many brokers don’t realize is that the law allows anyone to fund the underlying Health Savings Accounts. This means that employers (can and should) be shown how to use the savings in premiums created by moving to these types of plans to “fund” employee’s Health Savings Accounts. This can result in a “win/win” for all.
When employers fund the employee’s HSA they provide the employee the ability to direct additional money into a Flex spending type of plan (HSA) that has much higher limits for funding, and allows the same expenses to be reimbursed along with long term care premiums, Cobra premiums and Medicare B expenses. These accounts don’t have the “use it lose it” risk that Flex medical reimbursement plans have always included.
Now what we need is transparency data from the hospitals and providers. It is my belief that if every American was required to have a High Deductible Health Plan paired with a Health Savings Account only, the demand for transparency data would be palpable and the pressure forced on providers and hospitals to comply would amplify.
Right now the transparency data is not available and this needs to change. If the only plan employers could offer were HDHP plans with HSA accounts and if employers provided funding to help their employees be able to afford the additional exposure shifted to them, the demand for transparency data would suddenly become top priority and the government would demand it of providers.
Yes they are more complicated to understand and yes the programs require more employee education and hand holding…..Nothing good happens when we sit on the sidelines…Let’s commit to become part of the solution!
We all know that health insurance is expensive because healthcare is expensive.
Direct Primary Care may be an answer our society should explore.
It is a version of concierge medicine but priced for the average American ($65 to $90 month) on average.
Providing a relationship with a Direct Primary Care physician can be a dramatic step any self funded employer can take to impact and bend the healthcare cost curve and improve the healthcare employees receive.
Doctors collect a monthly subscription fee from the patient (or employer) which can be tax deducted or paid from a tax preferred Health Savings Account (preventive care is allowed as an expense). Because the Dr’s are not billing insurance they can prescribe most drugs in their office at a fraction of the cost.
We Americans and Employee Benefit Advisors must come up with workable solutions to the increased cost and decrease in quality we find ourselves in with our American health care system. We cannot let the status quo remain. Our country needs a good healthcare system based on free market principles.
Direct Primary Care is a good start in the right direction because healthcare is expensive.