With the arrival of the Affordable Care Act, some predicted that health insurance brokers serving the industry and small group employers would become obsolete. Despite predictions of demise, licensed agents are arguably more essential than ever.

This is particularly true for the small employer market. In fact, the need for these skilled professionals is actually accelerating. A main driver of this is the critical function brokers play in making emerging marketplaces and platforms such as government-run and private exchanges work in the first place.

On the flip side is the growth and proliferation of private exchange concepts, many of which use a defined contribution model. Current evidence suggests that these programs have the potential to be bigger — and better — options for many American businesses and their workers.

The report estimated that six million members enrolled in their benefits plan on a private exchange in 2015, nearly doubling numbers from the previous year. Forecasts call for enrollment to reach as high as 22 million before 2018.

It turns out that brokers, particularly those serving small businesses, are crucial to many successful public and private exchanges. That's because they serve on the front line providing quotes for coverage, explaining benefits to employees, problem solving for owners or management and, most importantly, servicing the business during the coverage year by providing ongoing support.

The market now offers a vast selection of options that people generally find difficult to understand and differentiate. The complicated changes in health care are actually doing more to drive small business groups toward brokers who are best equipped to meet these challenging demands.

The evolving broker relationship

Brokers succeeding in today's environment of exchanges have a broader and more important role than ever. They no longer simply enroll people in coverage. They help small employers and workers understand the intricacies of public and private exchanges entities as well as small business carrier options and how clients can navigate them. Moreover, savvy agents now play an even larger role in providing invaluable services after enrollment.

To address market demands, successful agents have everything to gain by placing a renewed focus on six key roles defining the relationship between brokers and small businesses:

Consumerism gurus: Some believed the increase of many new exchanges, technology platforms and online services signaled the beginning of the end for the broker role. But more than ever, small businesses need a guide, a specialist, an advocate and a problem solver to navigate the changing health exchange and marketplace options that are becoming increasing similar to 401(k) offerings. In essence, employers need a consumerism guru. In the midst of this change, the expert broker shines today, and will continue to do so within the small group market.
Advisors to small groups: Small businesses rely on health benefits to attract and retain the best workers. Restauranteurs, hair stylists, and machinists are skilled in their respective industries, not health and employee benefits. They are faced with the daunting task of finding the right coverage options at the right price to effectively meet the wide range of needs and requirements for their diverse group of workers. Without the steady hand of a professional advisor, the ability to zero in on optimal coverage options can be a difficult journey.
Service providers: The ACA has been a catalyst for automating a variety of traditional broker functions, such as plan comparisons, enrollment, physician selection, and more. But again, this trend is actually deepening the value of skilled agents. There are a number of reasons why, but they all track back to one vital factor: service. Brokers who assist businesses in navigating health care reform offer tremendous value. They can help manage health care costs, keep up to date on regulatory requirements and changes, and assist with benefits administration and employee benefits education. They listen to the needs of each business, match those needs to the best marketplace options, provide quotes for coverage, and place the business with the program that offer the best options.
Human interface: When it comes to identifying and selecting the best health insurance coverage, the devil really is in the details. Several years ago, an IBM-commissioned poll of 1,000 U.S. consumers found an overwhelming preference for personalized service and human interaction from their insurance providers. While technology has enabled the seemingly overnight explosion of online insurance marketplaces, brokers who can deliver service support to their customers will win out in the long term. When it comes to customer service, nothing beats face-to-face interaction that is timely, personalized and valuable to clients. A broker offering to provide a human element to their business is the leading preference of small company owners and their employees.
Single point expert: Benefit specialists who provide a single-point of contact to handle a multitude of needs and issues will win every time. Be the go-to expert for solving problems or needs, vetting and recommending coverage options, and guiding workers through benefit claims processes. The value of a single-source expert cannot be overstated. A good broker is the point of contact for satisfying all of a small business’ needs, whether it's health, life, dental, payroll or other benefit services. Not having to deal with multiple vendors and contacts saves time, money and employer and worker sanity.
Entrusted problem solver: Brokers are also entrusted problem solvers. Few benefits are as important to employers and their workers as health coverage. Small businesses are perhaps more acutely attuned to this, as they must try to compete with their larger counterparts for talent in a cost-effective manner. Putting one of the most important benefit decisions into the hands of a professional who can be trusted to make well-thought-out decisions on behalf of their clients is crucial.

Moreover, brokers today are tasked with unscrambling some of the most tricky benefit coverage puzzles. Since they do not directly represent a carrier, exchange, or marketplace, they are focused on serving client needs rather than selling to a specific (and oftentimes narrower) selection of plans. They sift through options and present the best, unbiased choices that match their client's employer-worker needs. Their primary motivation is to serve, not sell.

A relevant future

Without a doubt, health care reform and government-sponsored exchanges have accelerated consumer appetite around the idea of choosing the best coverage that works for them. But actually making the best decision without professional counsel or a well-designed provider platform supported by strong broker and customer service is another thing altogether.

In the end, business owners want and need professionals who offer health care coverage expertise and know-how, and in turn deliver service with personal touch. This is where smart, knowledgeable and service-oriented brokers and employee benefits specialists will thrive, both today and in the future.

Instant Insights /

Adding value to the relationship between brokers, small business groups

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