Group Health
Match the Right Healthcare Program to Your Client
by Jim Greth, CLU

Employers and their employees have more choices than ever in today's health insurance market. The healthcare landscape is vastly different from a decade ago and many more changes are on the horizon. As the healthcare system continues to consolidate, carriers are searching for ways to increase revenue. Also, more costly plans are requiring employers to pass along more expense to employees.

Brokers have new programs to evaluate and additional factors to consider. There is also a greater need to educate the client about finding the best solution for their healthcare needs. As an expert consultant, the broker is a key to the employer's satisfaction with their program. The broker's knowledge of new benefit designs, plan updates, and reimbursement accounts enhances their value to the client. Top producers have all the facts at their fingertips, they are up-to-date on the latest benefit solutions, and they use the best resources to match the plan to the client.

Your initial consultation should be to determine the needs of the business owner and the employees. Avoid presenting a ready-made solution. Work with the employer to answer the following key questions:

¥ How much are you paying for health insurance?

¥ How much do you want to pay?

¥ What do you want to accomplish by changing your health plan?

¥ What is your current plan design?

¥ What do you like about your plan?

¥ What don't you like about your plan?

¥ Are there any other issues of concern or interest?

¥ Do you want to set a budget for your heath insurance costs?

Your recommendation should include several options that address four key areas: benefits, provider networks, service, and cost. What works for one group may not work for another. For example, high-deductible consumer directed plans that are compatible with health savings accounts (HSAs) are generally more suited to groups that want a low-cost insurance plan. Usually, someone in the group is willing to take on the extra risk inherent in this type of plan. These plans can be ideal for young, healthy employees who make infrequent visits to healthcare providers and have no children. However, an HSA-compatible plan doesn't usually meet the needs of employees who have families and older employees who visit physicians and specialists more often.

Health reimbursement accounts (HRAs) and flexible spending accounts (FSAs) offer even more options. However, they require more education for the employer and the employees to make them work to everyoneÕs advantage. There are also plenty of variables with traditional plan structures. Some carriers offer dozens of plans, varying from HMOs to PPOs to suit a wide variety of member needs and preferences.

Employee-choice programs are popular with many California brokers. A single program can provide a selection of benefits, vast provider networks, and excellent service, while controlling costs. With the defined contribution strategy, employers can save by establishing a monthly defined contribution amount regardless of what an insurer charges. Employees get their choice of multiple health plans and benefit designs. Employees who want a plan that costs more than their employer's contribution, simply buy up by paying the difference. The employer gets single-source administration and one monthly billing statement without the complexity of dealing with each carrier separately. Employees get a worksheet outlining their options.

Offering an employee-choice program can be an ideal way to match the plan to the client. Employee choice programs offer HMOs, PPOs, and high deductible HSA-compatible plans in one program. They allow employers to manage their health insurance costs while offering quality healthcare coverage with the choices that employees demand. It's the best of both worlds for many employers.

Brokers who work with a general agency have a team behind them to make sure they get the most up-to-date information and have access to powerful online quoting systems. Field sales support teams help with presentations, enrollment, and employer meetings and employee meetings. Dedicated experts have in-depth knowledge of the carriers, plans, and the latest industry news, so you can focus on running your own business without trying to stay on top of every new development. Administrative support, marketing support, and continuing education enable you to serve clients better, enhance your image with clients, and match the right plan to the client.

Since brokers are the heart and soul of our industry, it is vital that these respected professionals have access to the most up-to-date information about carriers to ensure that they always match the right healthcare solution to the right employer group, at the right moment.

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Jim Greth, CLU, is senior vice president of Word & Brown General Agency. Word & Brown develops and distributes health benefit plan models and solutions to licensed brokers statewide. Headquartered in Orange County, the company has five offices located throughout California. Word & Brown General Agency is one of The Word & Brown Companies. For more information, visit www.wordandbrown.com.