Under promising and not even delivering – What Should Employers Expectations Be of Their Broker in 2016?
The simple phrase “you don’t know what you don’t know” truly speaks to the world of Human Resources and Finance today. Juggling various business functions, service providers and responsibilities, employers aren’t always aware of what they should be anticipating from their brokers.
For most companies in the US, we are now a few months removed from the open enrollment season and renewals with insurance carriers have been completed. As it relates to health insurance and employee benefits, what should your expectations be for your broker in 2016? With the rise of the Affordable Care Act, as well as the release of various innovative software and creative cost reduction strategies, the expectation for greater involvement and better service from health insurance brokers has increased. Because employers aren’t always aware of what these new innovations or creative strategies might look like, below is a quick list highlighting a more holistic approach to benefits strategy:
- Employer Communications
a. A recap meeting to discuss 2015 open enrollment and renewal – How did it go, what could have been improved, etc.
b. A Dashboard/timeline highlighting important dates throughout the year regarding ACA/IRS compliance, special project rollouts, and ongoing strategy meetings to evaluate and adjust goals and expectations.
c. Monthly underwriting reports illustrating employee utilization of healthcare and experience.
d. Monthly webinars and email updates regarding Affordable Care Act, Department of Labor, IRS and other compliance-related issues.
e. Benchmarking data to compare and contrast where/how you rank with competitors in your industry, state or nationwide.
i. Are you paying/offering too little or too much? How does this fit into your overall business plan presently and in the future?
- Employee Communications
a. Is your broker providing you with an online benefit administration platform for employee’s to access in a convenient way? Do you have technological constraints, or is English as a second language something to consider? There are creative ideas for both.
b. Employee Benefit statements showing the monetary value they are receiving and highlighting the generous contributions you as an employer are providing.
c. Monthly employee communication materials raising awareness of various benefits you provide highlighting their value and encouraging further utilization and appreciation. Studies have shown that even when employers offer less than rich benefits, increased and effective communications actually result in a greater perception of benefit offerings and employee appreciation.
d. Monthly employee communications on wellness, nutrition or other holistic health topics to educate your employees.
e. If a wellness plan is in place (and it should be in some form), weekly or monthly communication pieces highlighting the wellness plan, incentives or education materials to increase excitement and utilization.
- Additional services
a. Does your broker provide and pay for in-house COBRA administration?
b. Does your broker provide additional software platforms that help HR functions like time and attendance, onboarding, or FMLA administration?
c. Is your company considering an acquisition and can your broker perform an exhaustive benefit and compliance audit of the target company to identify potential cost savings or traps that could influence your bargaining?
d. Does your broker provide 24/7 support for employees having claims issues or needing assistance with their health insurance?
e. Does your broker provide additional HR support by providing services like ThinkHR designed to answer any and all HR-related questions, as well as provide services like sexual harassment training videos for managers required in some states?
- Cost Reduction Strategies
a. Exposure to the best insurance carriers and vendors? When was the last time you went to market and compared costs? Some brokerage firms enable consultants to bring the most innovative and capable partners to clients.
b. Are your company contribution amounts in line with your business plan, culture and competition (benchmarking data is needed)?
c. Are your health plans in need of tweaking? Are you offering high deductible plans alongside an HSA/FSA/HRA to reward employees for maintaining good health?
d. Have you done a spousal surcharge audit (generally at least 10-20% of employee’s have spouses on their company plan who also have their own employer plans that they declined)?
e. Tobacco Surcharge (conservatively, at least 10% of employee’s in CA are smokers)?
f. Have you considered and has your broker ran an analysis for you to see what it would cost/save to offer employee’s an incentive to go onto their spouse’s employer plan rather than yours?
g. Has your broker started a discussion around alternate funding options such self-funding, level-funding or graded-funding options as part of a long-term strategy to reduce costs and offer greater employer control over their benefit offerings?
The list of services you should be expecting from your broker is not always the case from what you are actually receiving. With so many innovations and changes happening at a rapid pace, you as an executive cannot expect to know them all and instead must rely on outside counsel from various service providers and vendors. As it relates to employee benefits, these services above and the consultation you should be receiving, should all be seen through three intertwined lenses: lowering costs, saving time on overall benefit administration, and increasing employee awareness and appreciation. With insurance premiums and broker commissions steadily increasing each year to an all-time high, ask yourself the question: is my broker earning it?
By John Meister, Consultant, Digital Benefit Advisors Southern California
John Meister is a Benefits Consultant at Digital Benefit Advisors – Southern California is part of the nation’s largest independent employee benefits-only agency for mid-market employers. John’s passion for finding creative ways to bring value to clients has led to not only hundreds of thousands of dollars in savings, but a significant decrease in the time employers spend administrating a robust employee benefits program through value added technology platforms.
Digital Benefit Advisors delivers holistic employee benefits solutions that focus on enhancing an organization’s return on investment via innovative plan designs, progressive negotiation strategies, risk management solutions, and human resources and benefits technology options. Their national footprint enables us the firm to offer unique services and highly competitive rates for clients, including access to their Private Exchange known as their Benefits Marketplace. To learn more, visit digitalbenefitadvisors.com.