Benefits brokers, Agents or TPAs who focus solely on the health plan needs of an employer's executive team are missing a huge opportunity to openly serve their clients.
This focus should not exclusively be on your customers, but actually their customers. To be more specific; their employees. We see it all too often where decision makers that have genuine impact on health plan offerings don’t recognize who their employees are, what they truly want and need in health plan options, and how better understanding the real needs of their employees as a whole can reduce healthcare costs for the entire organization.
There is an opportunity for forward thinking benefits brokers to progress and be true stewards of their clients needs. In better understanding a client's employees needs, brokers have the ability to design plan options that will move their clients closer to what they are truly needing; affordable quality healthcare for their entire workforce.
Learning = More Customers
Your customer’s employees are anything but rigid in their viewpoint relating to health care coverage. Wants and needs vary depending on specific demographics. To get a better understanding, here are the three main areas of plan selection that employees take into consideration – choice, cost, and brand.
CHOICE
Available Benefits: What benefits are available to the employee through plan selection? Not all benefit offerings are created equal and employees know that. On one end of the spectrum is the employee looking for a comprehensive platinum plan and nothing else, while on the other side of the spectrum we have the hourly employee that is barely skating by looking for something to handle the “just in case.” When providing alternatives, look for a plan that offers care options that support both ends by recommending plans that facilitate preventative, outpatient and inpatient benefits, and telemedicine visits while still maintaining cost saving strategies (we will get to that next).
Flexibility: Paying attention to the degree of restrictions, or the lack thereof, built into a given offering can speak volumes. The spectrum here ranges from 1) no trouble with restrictions, 2) Some concern but is willing to forgo some restrictions in place if the accommodation is right, 3) to requiring no restrictions.
COST
Richness of benefits and cost-sharing: The level of health benefits and the degree to which this translates to the amount of cost-sharing between the employee and the plan is the first part of the Cost Decision in selecting a plan. This is where deductibles, coinsurance and out-of-pocket maximums become a deciding factor. Enter the employee spectrum again: At one end, employees are vying for the lowest total cost, and have zero interest in features. And on the opposite end, the priority remains in the abundance of the plan, with no regard to cost. Let’s not forget the majority of those floating in the middle of the spectrum as they are the majority. While usually price sensitive, they meticulously consider what is truly needed from their health plan versus what they can afford.
Contributions (paycheck deductions): The Premium Paycheck deduction is the component that is dialed directly into the fixed cost element of all health plans. This is where employees really begin to polarize. On one end, employees select the plan they want in spite of costs associated, then people (the smallest portion) who attempt to navigate a doable paycheck deduction and perhaps a “compromised” deductible, to those who need the out-in-out lowest premium attainable, even with the risks associated with constantly raising deductibles and/or coinsurances.
While some of your clients' employees will grasp almost always on one of these cost factors, we find that most are forced to amalgamate the two to come up with some sort of “I think I can afford this” calculation that is clearly and infinitely tied to their salary and funds available to live.
BRAND
This space occupies one thing alone – the logo on their ID card. For most of your clients’ employees, a benefit plan’s brand name doesn’t make a bit of difference, they just want coverage that they can afford and actually use. This does not mean there aren’t outliers in the organization that will consider plans offered by well-known brands but will be more than open to switching among this subset if their wants and needs are addressed. And then of course there are the few that will lock on to their preferred brand and balk at the consideration of other benefit options.
Successful brokers, agents and TPAs need to recognize the dynamics associated with this and begin to understand what the clients’ employees value most. What are they not willing to sacrifice? What are they willing to trade-off? The better you pair options to employees’ top priorities, the more solutions you recommend become more effective. This trade-off is the key for brokers if they truly value helping their clients. What concessions will employees be willing to make and still feel their health plan benefit is valuable?
For a good example of varying inclinations among employees, look at breaking these groups down by age. As Forbes.com highlights, you’ll find that Gen X and Baby Boomers embody a more traditional perspective when it relates to health care plans and benefits. A majority of decision makers that you as a broker or administrator advise likely belong to one of these segments.
Next up, Millennials. Born between 1981-1996 and the Gen Z’s born from1997- to the mid 2000s. Focus on targeting your efforts towards Millennials. According to the US Bureau of Labor Statistics, they currently make up approximately 35% of the US workforce, and are anticipated to increase in numbers by 4.4 million by 2029. As noted in the Forbes article above, nearly 55% of Millennials shop solely based on cost when selecting health benefits. Based on this information alone, it could be concluded that most Millennials would switch plans if the plan is more cost effective to them.
This analysis can and should be applied to into consideration other key healthcare factors such as socioeconomic status, household income and location.
What most employees are expecting with their health plan may differ greatly from what the older, better paid decision makers may think. To put it into layman's terms, your buyer, while intentions may be pure, more than likely doesn’t directly reflect the majority of their plan users.
Understanding and anticipating these dynamics is invaluable for the fact that at any given time, approximately 10% of your client business is in play. Brokers, Agents, and TPAs who won’t adapt to this changing and now very diverse landscape will lose business to those who do.
Offer actual choices, fundamental solutions, actual action
With all of the information provided above, please remember It’s more than just comprehending what’s entailed in an employee-centric approach to building a benefit plan for healthcare coverage. It’s just as important to recognize what a shift in this approach is not. It is absolutely not a take-it-or-leave-it proposal. And it’s not nearly as disruptive as some may think.
Great Brokers, Agents, and TPAs position themselves alongside industry experts that have the data, modeling and decision support to help traverse the shifting terrain to reach their clients (and their employees) goals. This equates to plan options that employees truly want, can afford, and will actually use. The best Benefit Plan Builders share and recommend these choices to decision makers, who in turn give their employees a significant choice of quality, affordability based health plans.
The message employers and decision makers are needing to receive is quite simple: Employees will recognize and appreciate a range of choices. Some will want a broad selection of benefits and be willing to pay for that. Others will highly value affordability above flexibility. Offering all these things will ultimately make your client’s employees truly appreciate the value of their health plan benefit.
Coterie Advisory Group’s Fundamental Care® programs are Affordability-Based Medical Plans which are designed for various niche-markets, including: small business and their employees, part-time, hourly, seasonal employees at enterprise-level companies, independent contractors, gig-economy workers, and association members. Fundamental Care is designed to meet the needs of the underserved, by providing access to unique and affordable health insurance benefits on a guaranteed issue basis. Limited-Day and Limited-Benefit Indemnity plans can be customized and structured with affordable premiums and no deductibles. Coterie Advisor's can also provide Minimum Essential Coverage (MEC) and bronze-level Minimum Value Plan (MVP) options for client's needing a solution for their full-time equivalent employees. The combined offering of the Fundamental Care plans is unique to the marketplace. Through Coterie's Affordability Based Medical Plan Strategy, the plans not only provide needed healthcare to the insured employees but also offer companies a strategy to improve recruiting and reduce turnover by rewarding a carve-out class or more-tenured employees.
Fundamental Care offers two Affordability-Based Medical insurance options which can assist:
An employer-sponsored, level-funded, Limited-Day Health Plan for small to midsize employers and carve-out classes of large employers. Plans cost 30-40% less than HDHPs with no deductibles. A near-comprehensive plan that both employers and employees can afford.
THREE LEVELS OF PLAN
An affordable Bronze MVP plan – with no deductible
An affordable mid-range MEC plan with limited days of hospitalization– with no deductible
A Value priced outpatient expense MEC plan- with no deductible
A Limited-Benefit Indemnity Plan for large employers with part-time, hourly, and seasonal employees; and for associations and affinity groups. An affordable option for the uninsured that provides coverage for basic medical expenses.
Available with or without Minimum Essential Coverage (MEC) and Minimum Value Plans (MVP)
Both can be customized and structured with affordable premiums and no deductibles. The plans are high in potential coverage, guaranteed issue, and include upfront, day-one benefits.
Coterie Advisory Group, Inc. is a National insurance program manager and consultative advisor who delivers Affordability Based Medical Plan Strategies to help benefit brokers, consultants, employers, and associations in the benefits industry.