Benefit Brokers and Employer Providers Face Challenges and Opportunities
2013 delivered more than a New Year to the Insurance and Benefits Industries.
PPACA/Obamacare started to kick in and HHS began rolling-out guidelines and regulations almost on a daily basis.
Disruptive Changes Creating Issues - Brokers, as well as Carriers and Service Providers, face a slew of disruptive changes and new issues, these include:
In addition, Brokers face increased demands for their time and expertise with reduced support from Carriers/Providers.
Let's take a look at these changes and the issues: 1) Timelines for Implementation - While a number of groups have created timelines for the implementation of PPACA/Obamacare, we recommend starting with the Federal Government's Timeline.
2) A New Vocabulary of Terms - We have isolated the following terms that are either reasonably new or that Brokers should review - There are probably many more! (Searching Google will provide multiple definitions and descriptions).
Adjusted Community Ratings - PPACA Administrative Simplification Regulations Cadillac Plans CDHPs CHIP Plans Co-Ops - PPACA Related Deductible Limits - PPACA Related Dental Insurance Maximums under PPACA Early Retiree Reinsurance Program EHBs - Essential Health Benefits Enrollment Waiting Period - Under PPACA Excise Taxes - For Cadillac Plans Federal Exchanges - Health Insurance FFE - Federally Facilitated Exchanges Free Choice Vouchers - Under PPACA FSA Limits - Under PPACA Grandfathered Plans - uunder PPACA Guaranteed Issue - Under PPACA HDHPs - High Deductible Health Plans HHS - Health and Human Services HRAs - Health Reimbursement Accounts HSAs - Health Savings Accounts Individual Mandates - Under PPACA Interstate Insurance Compacts Life Time Limits - PPACA Related MLR - Medical Loss Ratios Multi-State Plans - PPACA Related NAIC - National Association of Insurance Commissioners Navigators - Exchange Related OPM - Office of Personnel Management Out-of-Pocket Expenses - Rescissions Penalties - Under PPACA PPACA/ACA/Obamacare Pre-Existing Conditions - Under PPACA Preventive Care (A&B) - Under PPACA Private Exchanges - Health Insurance QHPs - Qualified Health Plans QHIPs - Qualified Individual Health Plans Risk Corridors - Related to PPACA SBC - Summary of Benefits and Coverage Section 125 of the IRSC Section 105 of the IRSC Shared Responsibility - PPACA Related Section 105(b) of the IRSC SHOP Plans SPDs - Summary Plan Descriptions State Exchanges - Health Insurance Subsidies Tax Credits - For Providing Health Insurance Tax Subsidies - For Health Insurance Uniform Glossary of Coverage Variable Hour and Seasonal Employees Waiver Process - Under PPACA 3) The Need for Strategies and Solutions for Assisting Clients and Potential Clients with their Concerns, Questions and Demands- We suggest there are 5 Profitable Strategies and Solutions that Brokers can implement with existing Clients and utilize to attract New Clients.
It is important to emphasize that this is the time for Brokers to reach out to Employers, Employees, and Individuals as a Trusted Advisor.
It is essential to meet with decision-makers who are confused and need help.
Schedule meetings - to inform not to sell -using a combination of traditional Outbound and New Inbound Strategies.
This is the time to be pro-active! 4) Brokers face Reduced or Disappearing Commissions from Health Plans due to MLRs and Market Forces -While Carriers of the Health Plans have slashed the commissions, this is only one revenue stream for Brokers offering Benefits and Insurance.
Brokers should continue to be, or become, the Trusted Advisor for the Employer's, Employee's and Individual's health insurance coverage.
At the same time, the Broker should begin introducing the concept of Fee Based compensation for their advising services.
Most Employers are not aware that Brokers are no longer being adequately compensated by the Carriers for their services.
Employers are accustomed to paying for advice, ie.
accounting, legal, risk management, etc.
Brokers should also be the Menu Builder for theVoluntary/Worksite and Ancillary Benefit Plans.
As Employees and Individuals participate in these plans and services (penetration), the commissions can be extremely profitable and an important piece to the Broker's Strategies for Success.
The renewals generated from Employees and Individuals remaining on the Voluntary/Worksite Plans - year-after-year (persistency) - provides the Broker income required for maintaining ongoing Service.
Conclusion - In many ways 2013 and Beyond will be a great time to be a Broker - as well as to be a Carrier or Service Provider! Brokers should embrace the disruptive changes and capitalize on the opportunities.
PPACA/Obamacare is not going away! There is a great deal to learn and adjust to as guidelines and regulations roll-out.
The massive changes to the traditional marketplaces have leveled the playing fields.
There are no experts at dealing with PPACA/Obamacare.
No one has years of experience.
There are Individuals and Organizations who are keeping up with the guidelines and regulations as they roll-out and that are creating profitable strategies and solutions.
This is a great time to Partner and Affiliate with other Organizations to both gain expertise and to diversification.
PPACA/Obamacare started to kick in and HHS began rolling-out guidelines and regulations almost on a daily basis.
Disruptive Changes Creating Issues - Brokers, as well as Carriers and Service Providers, face a slew of disruptive changes and new issues, these include:
- Timelines for Implementation
- A New Vocabulary of Terms
- The Need for Strategies and Solutions for Assisting Clients and Potential Clients with their Concerns, Questions, and Demands
- Reduced or Disappearing Commissions from Health Plans due to MLRs and Market Forces Creates the Need for New Revenue Streams
In addition, Brokers face increased demands for their time and expertise with reduced support from Carriers/Providers.
Let's take a look at these changes and the issues: 1) Timelines for Implementation - While a number of groups have created timelines for the implementation of PPACA/Obamacare, we recommend starting with the Federal Government's Timeline.
2) A New Vocabulary of Terms - We have isolated the following terms that are either reasonably new or that Brokers should review - There are probably many more! (Searching Google will provide multiple definitions and descriptions).
Adjusted Community Ratings - PPACA Administrative Simplification Regulations Cadillac Plans CDHPs CHIP Plans Co-Ops - PPACA Related Deductible Limits - PPACA Related Dental Insurance Maximums under PPACA Early Retiree Reinsurance Program EHBs - Essential Health Benefits Enrollment Waiting Period - Under PPACA Excise Taxes - For Cadillac Plans Federal Exchanges - Health Insurance FFE - Federally Facilitated Exchanges Free Choice Vouchers - Under PPACA FSA Limits - Under PPACA Grandfathered Plans - uunder PPACA Guaranteed Issue - Under PPACA HDHPs - High Deductible Health Plans HHS - Health and Human Services HRAs - Health Reimbursement Accounts HSAs - Health Savings Accounts Individual Mandates - Under PPACA Interstate Insurance Compacts Life Time Limits - PPACA Related MLR - Medical Loss Ratios Multi-State Plans - PPACA Related NAIC - National Association of Insurance Commissioners Navigators - Exchange Related OPM - Office of Personnel Management Out-of-Pocket Expenses - Rescissions Penalties - Under PPACA PPACA/ACA/Obamacare Pre-Existing Conditions - Under PPACA Preventive Care (A&B) - Under PPACA Private Exchanges - Health Insurance QHPs - Qualified Health Plans QHIPs - Qualified Individual Health Plans Risk Corridors - Related to PPACA SBC - Summary of Benefits and Coverage Section 125 of the IRSC Section 105 of the IRSC Shared Responsibility - PPACA Related Section 105(b) of the IRSC SHOP Plans SPDs - Summary Plan Descriptions State Exchanges - Health Insurance Subsidies Tax Credits - For Providing Health Insurance Tax Subsidies - For Health Insurance Uniform Glossary of Coverage Variable Hour and Seasonal Employees Waiver Process - Under PPACA 3) The Need for Strategies and Solutions for Assisting Clients and Potential Clients with their Concerns, Questions and Demands- We suggest there are 5 Profitable Strategies and Solutions that Brokers can implement with existing Clients and utilize to attract New Clients.
It is important to emphasize that this is the time for Brokers to reach out to Employers, Employees, and Individuals as a Trusted Advisor.
It is essential to meet with decision-makers who are confused and need help.
Schedule meetings - to inform not to sell -using a combination of traditional Outbound and New Inbound Strategies.
This is the time to be pro-active! 4) Brokers face Reduced or Disappearing Commissions from Health Plans due to MLRs and Market Forces -While Carriers of the Health Plans have slashed the commissions, this is only one revenue stream for Brokers offering Benefits and Insurance.
Brokers should continue to be, or become, the Trusted Advisor for the Employer's, Employee's and Individual's health insurance coverage.
At the same time, the Broker should begin introducing the concept of Fee Based compensation for their advising services.
Most Employers are not aware that Brokers are no longer being adequately compensated by the Carriers for their services.
Employers are accustomed to paying for advice, ie.
accounting, legal, risk management, etc.
Brokers should also be the Menu Builder for theVoluntary/Worksite and Ancillary Benefit Plans.
As Employees and Individuals participate in these plans and services (penetration), the commissions can be extremely profitable and an important piece to the Broker's Strategies for Success.
The renewals generated from Employees and Individuals remaining on the Voluntary/Worksite Plans - year-after-year (persistency) - provides the Broker income required for maintaining ongoing Service.
Conclusion - In many ways 2013 and Beyond will be a great time to be a Broker - as well as to be a Carrier or Service Provider! Brokers should embrace the disruptive changes and capitalize on the opportunities.
PPACA/Obamacare is not going away! There is a great deal to learn and adjust to as guidelines and regulations roll-out.
The massive changes to the traditional marketplaces have leveled the playing fields.
There are no experts at dealing with PPACA/Obamacare.
No one has years of experience.
There are Individuals and Organizations who are keeping up with the guidelines and regulations as they roll-out and that are creating profitable strategies and solutions.
This is a great time to Partner and Affiliate with other Organizations to both gain expertise and to diversification.
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