With the passage of the Senate bill, there is a lot of confusion about the future of the entire health insurance industry. We can all agree there are many things we just don't know yet and there are two national elections between now and 2014.
But based on market response - evidenced by the increasing number of employees enrolling in limited medical plans - it is obvious that the need for limited medical plans has never been more pressing. It appears that limited medical plans will be available for coverage until 2014, but answers are still to come regarding grandfathering and limits on benefits. And while we wait for further clarification on what the law will and won't allow, now is the time to place your clients in a limited medical product that is rate and administratively stable, and that allows them to focus on the myriad of changes they will be forced to make in the face of reform.
While some people are taking the gloom and doom perspective about the likelihood that limited medical plans will be outlawed, there is a huge opportunity for brokers who seize the day and continue working with customers on solutions. There are several renewal seasons between now and 2014 - so start thinking about ways to offer value to your clients as they wrestle with understanding what the future holds.
While the entire country had their collective eyes glued on the potential impact of health care reform, there were savvy brokers who let the drama play out in Washington and focused on their business. They hit the ground running, rolled up their sleeves and continued selling solutions to clients. Our message to brokers is this: Do your job and stop whining about health care reform and the rising cost of health care. Step up to the plate and sell solutions, not just products.
Engage your client in discussions and don't be afraid to tell them the truth. Whether you prefer to market them as limited medical, mini-meds, or limited benefit plans, they are a product that should be part of the solution you're offering to your customers and there are many creative ways to recommend limited medical solutions to your existing customer base as well as prospects. We don't know what the future holds for limited medical products - but we know they can help a lot of people right now.
The discovery process is still the most artful part of the sales cycle and it is also the most important. Talk to your client about their pain points and problem areas. What is working? What is not working? Listen to your client and understand what they are looking for, then you can set yourself up to sell solutions that never show up on a spreadsheet and thereby create the most value possible for the client. When this kind of process happens, solid and trusting relationships are built that enable brokers to keep clients for years. And, if a broker does not get complacent, they will engage in this process regularly with the client.
Let's look at a few areas where solutions are being successfully applied and embraced in the limited medical space. First, the traditional limited medical marketplace continues to be fertile ground. Some obvious targets are the large, voluntary limited medical cases that were originally served by limited medical programs created in the 1990s, such as big box retail stores, national restaurant chains, staffing firms and convenience stores. These industries continue to need limited medical plans for their hourly workforce and many of them would do well by taking a fresh look at the limited medical plans available today.
A great way to start a discussion about their current plan in hopes of moving them is to ask about the company's goals in offering limited medical with regard to rate stability, employee and employer contributions, and participation.
For example, does their current plan offer:
- Updated technology, such as taking credit card payments for missed premium online (restaurant workers are prime candidates for this) and Web portals where participants can enroll and manage their account?
- An enrollment process check to analyze how information is distributed to employees combined with multiple enrollment options to increase participation levels?
- Finally, what process improvements are possible in the payroll deduction and eligibility file transfer that make life easier for the HR, IT and payroll departments of employers?
Brokers and clients sometimes have trouble discussing plan participation and how it impacts all employees. This is another area where a proactive broker can present themselves as a solution provider today and for the future. Taking a closer look at the client who struggles to maintain participation in a major medical plan because of cost will position good brokers as a resource to their clients. So it's important to have this conversation before they either get dropped by their carrier or meet another broker who brings an alternate solution to them. It is your job as their trusted adviser to present the full spectrum of health insurance options. It is not necessary to force one class of employees to go without coverage while some employees can and will pay for major medical. Encourage these kinds of clients to make the tough decision to create classes of employees for major medical coverage and limited medical coverage. After doing so, they will see better employee participation, a happier major medical carrier and more employees who feel taken care of by the benefits available.
Another opportunity for marketing limited medical plans is the one presented by the Service Contract Act. The McNamara O'Hara Service Contract Act of 1965 (SCA) requires general contractors and subcontractors performing service contracts in excess of $2,500 to pay service employees (such as janitorial service providers and security guards in federal buildings) no less than the wage rates and fringe benefits found prevailing. These contracts include specific amounts of money to be spent on benefit programs. Companies that employ service workers employed on military bases, the nurses staffing the hospitals, and other government bid contracts are great targets for limited medical plans. In slower economies, government work is a popular place for employers to look for work. And limited medical plans can be a great fit for many of these firms.
Some employers may be reluctant to switch plans in the face of health care reform, but the reality is that there's never been a better time to make a change. Look for plans that offer great service and administration, online tools for enrollment and missed premium, and rate guarantees until Dec. 31, 2013. Putting eligible employees in a robust, well-administered limited medical plan will enable HR staff to focus on the bigger picture of the future of health care delivery inside their organization.
Limited medical products continue to be a great tool to help brokers solve problems and create long-lasting client relationships. Especially today, when so much of the future of health insurance is unclear - we, their insurance advisers, need to ask the right questions and work alongside our clients to deliver the solutions they need.
