The Flame – Reform Questions Answered, Employer Concerns, Paperless Perks

A Broker’s Role in a
Post-Reform World
The arrival of Patient Protection and Affordable Care Act (PPACA) brings with it many questions. One of those questions is what is
the role of brokers in a post-reform world? While we certainly do not have all of the answers, early indication is that brokers will continue to perform a key role in the delivery of health insurance for both groups and individuals.
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Bring value
Minimum loss ratios will be a big driver of how brokers are compensated in 2011 and beyond.
To best position your business for success,
you should begin to focus now on the value that you bring to the system. We expect to see a return to needs-based selling as opposed to spreadsheet selling. After all, if your primary value proposition is your ability to bring a
number of carriers to the table, it will be difficult to compete with the exchanges in 2014.
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Producers who focus on individual service
and helping clients meet their needs will be
able to differentiate themselves in a largely commoditized market. Keep in mind that if the PPACA works as it was designed to, there will be as many as 33.8 million additional insured people by 2019 (CMS Office of the Actuary). Many of these new customers will be overwhelmed by the choices they face and will need help navigating carrier customer service policies, understanding provider networks and maximizing their policy benefits.
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Bolster your reputation
Producers should begin to build their reputation
for being high-service by requesting that satisfied customers rate them on sites such as LinkedIn. In addition, you can build relationships within the customer service departments of your primary carriers. While these relationships have been important in the past, the ability to capitalize
on them in the future could be the key to your survival. Finally, you should begin to survey
your customers, either electronically or through phone calls to see how you can improve your service levels.
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Enhance your offerings
Another strategy that you might want to employ
is to round out your product portfolio with value-added products. Value adds, such as dental, critical illness, hospital indemnity and limited benefit medical can help you offset potential commission loss from major medical. Although the health products sold going forward may end up being richer than those in the market today, there will still be gaps in coverage that ancillary products can fill.
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Inform clients
For agents in the small group market, one overlooked opportunity is the small business
tax credit for qualifying businesses with fewer
than 25 full-time equivalent employees. This tax credit is available for employers who pay at least 50 percent of their group’s medical premium. To qualify the business must have an average wage of less than $50,000 per employee. Visit the Small Group section of The Flame, or read this news release from the IRS for more information.
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It certainly is not too early to begin planning
for the post-reform market. We have been experiencing incremental reform for several years, and although the PPACA will accelerate change, we are committed to remaining a
viable option for our customers and our producers amid the changes.
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Watch Jeff Smedsrud, IHC Health Solutions
CEO and co-president of the fully insured division, as he discusses the PPACA and IHC’s role in the years ahead with A.M. Best Company.
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