Benefits brokers and consultants outline the numerous tacticsthey're taking to overcome objections due to the state of the economy and the uncertainty over how the provisions of the Affordable Care Actwill be implemented—including the possibility that some or all ofthe provisions of the law might not be implemented at all if theindividual mandate is deemed unconstitutional by the U.S. SupremeCourt.

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Benefits professionals also explain how they combat standardroadblocks such as reticence to leave existing brokers or the “ifit ain't broke, don't fix it” mentality. If prospects object to newservices or existing clients want to cut services because theirbudgets are constrained in the tough economy, the most unethicalthing a benefits professional can do is to give bad advice and tryto convince them that more services would be better without firstanalyzing what actually might be best, says John Kelly, director ofstrategic partnerships for Ceridian's human resource and payrollbusinesses.

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“It is fundamental not to give bad advice just to generaterevenue,” Kelly says. “We should help our clients prioritize theirspending appropriately, for both today and for the future, becausethe lack of current investment can jeopardize future growth.”

Suggesting Cost Cutting

One way to overcome the objection of constrained budgets is torecommend services that can actually reduce costs—which the clientcan then reinvest into benefits services that ultimately help thebottom line by reducing absenteeism and increasing employee engagement, hesays.

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For example, Kelly recommends clients and prospects considerimplementing dependent eligibility audits to determine if all ofthe people listed as dependents on employees' health care plans areactually eligible. For the average employer, if 30 people are foundto be ineligible, a company can save $90,000 a year in health carecosts.

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Kelly recommends giving half of that potential savings back tothe company's bottom line, and investing the other half intotechnology upgrades or new wellness initiatives, such as smokingcessation and weight control programs to combat obesity.

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“Don't cut back on things that are going to reduce absenteeism,”Kelly says. “What are the areas where you can tightenup and what are the areas that you cannot afford to?Although it may be trite, sometimes companies have to spend moneyto save money.”

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Kelly also counters objections over budget constraints with theidea that prospects can save money by choosing a benefitsconsultant who offers a bundling of services. Consolidation ofnegotiating power with few vendors could be a very good way toreduce overall costs.

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Julie Daly, an area senior vice president in San Francisco, saysthe first obstacle to getting new business these days is actuallygetting through to HR professionals who're struggling with fewerstaff and greater workloads.

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“HR departments are so lean now,” Daly says. “They've beendownsizing HR departments 30 percent to 40 percent, so where theremight have been 10 people, there are now seven doing the work of10, with 2,000 employees. So the first challenge is just gettingthrough voicemail.”

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To combat this, Daly calls during nonpeak hours—lunchtimes andon Fridays, when HR professionals are more relaxed. If she's ableto reach someone who still tells her they don't have time to talk,Daly suggests a later meeting to discuss how their current benefitschoices or the latest issues might be impacting their bottom lineor whether they might have fallen out of compliance withever-changing regulations.

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“They have a 'if it ain't broke, don't fix it' mentality,” shesays. “What I generally try to do is give them something— everybodyis looking for guidance about what to do about escalating costs,retaining and attracting employees, and understanding latestcompliance requirements around health care reform.”

Talk Enrollment

Alternatively, many prospects tell Daly there's no need to talknow because open enrollment time is nearly a year away. That's whenshe tells them there are changes in compliance or legislative areasthey should be aware of now, so they can be compliant by thattime.

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Most times, the actual wording of a prospect's objection is notrelevant, Daly says.

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“The biggest objection overall is just not wanting any kind ofreview or discussion,” she says. “The solution to that is to givethem a reason to want to meet with us, by providing informationthat might be helpful for planning and cost containmentstrategies.”

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To overcome the objection that health insurance premiums are toohigh, the brokers at Benefit Services in Wellesley Hills, Mass.,offer certain employers with 100 or more employee alternativefunding arrangements for medical and dental. In particular, the firm specializes in arrangingpartially self-funded plans, which are comprised of a third-partyadministrator that adjudicates the claims; a stop-loss carrier whooffers two levels of insurance that includes both a specificdeductible (so the employer will not be responsible for any claimson any individual over a pre-determined maximum); an aggregatemaximum that the employer's claims cannot exceed during a planyear; and a network of providers.

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Massachusettshas the most expensive health care in part because we have themost state mandates built into our fully insured plans—the mostexpensive mandate is for unlimited infertility treatments,” saysMaureen Baker, vice president of sales. “But a self-funded plan isan ERISA plan, which does not have to include the state mandates,so there's a lot of cost savings.”

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Partially self-funded plans offer the employer greaterflexibility in plan design than traditional fully insured plans,says Benefit Services President Bruce Coughlin. The employer canswitch re-insurers while keeping the same network of doctors andhospitals, thus gaining the most competitive stop-loss rateswithout disturbing the employees. The employees will not notice ifthe reinsurer is changed because the same third-party administratorwill pay the claims and the employees will be using the samenetwork. The transition is seamless, Coughlin says.

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“We can look into doing this for a company, but it's not rightfor everybody,” he says. “For some companies, partial self-fundingcan be less expensive and thus more palatable way to purchase groupmedical insurance.”

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For companies that have much fewer employees, insurance ratestend to be the same. If a prospect says they already have a broker,Coughlin says his firm tries to distinguish itself by touting itsindustry experience, plan design and additional services.

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“We tell smaller groups that we're more than just a broker—we'rea partner who will work with them,” Coughlin says. “We tell themthat we want them to be in touch with us on an ongoingbasis. We'll send them newsletters and informationalemails.”

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Benefit Services is currently letting both prospects and clientsknow about a current initiative by Massachusetts carriers ofimplementing tiered networks to encourage participants to selectthe least expensive hospital for surgery, Baker says. For example,participants can choose a Tier 1 hospital and not pay a deductible;or a Tier 2 hospital and pay a $1,000 deductible; or a Tier 3hospital and pay a $2,000 deductible plus co-pay.

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“Groups are going to need more assistance in determining what isthe best plan design for them,” Baker says. “The key is listeningto the client and fitting the benefit program to the company.”

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M. Dennis Guappone, a principal at United Benefit Services inNewton, Mass., a unit of Brown & Brown Co., says the mostcommon objective from a prospect is loyalty to their existingadvisers.

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“We suggest they put out an RFP—start fresh, line brokers upside by side, and find out who provides the most value to thecompany and bottom line, to their employees.”

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To ensure United is among the top candidates for such an RFPprocess, Guappone says his team focuses on recommending ways toachieve indirect savings, such as streamlining operations of the HRdepartment, or implementing Web-based services into a prospect'sorganization to eliminate redundancy of tasks.

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“HR technology is coming downstream in the marketplace,”Guappone says. “It used to be affordable for 10,000 and abovecompanies, but now 100 employee companies can afford it, but manydon't know they can.”

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United also belongs to a national purchasing group that enablesthe firm to obtain these types of services for less, he says.

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Objecting Voluntary Benefits

J.J. Summerell, the managing director of Worksite Insight, inGreensboro, N.C., is a wholesale broker of voluntary benefits, andhence, has to overcome objections from three differentconstituencies—a client's primary broker, that client's HRprofessional  and the client's employees.

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Brokers often object by saying they are not interested in thesetypes of benefits, but Summerell counters that by telling themreceiving a commission from the sale of voluntary benefits might offset diminishing commissions fromhealth care plan sales due to the advent of minimum medical lossratios in the new health care law. Insurance companies are nowrequired to spend 80 to 85 percent of premium dollars on medicalcare and health care quality improvement, leaving just 15 to 20percent for overhead—including broker commissions.

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“Commissions are getting squeezed, but selling my types ofbenefits directly to employees could offset that squeeze for thoseagents,” Summerell says.

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If brokers tell him they already use the services of one of hiscompetitors, Summerall shows them spreadsheets of productscompetitors offer, commission levels and how the broker iscontracted, to determine who actually owns the business they areselling.

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“Most important is owner renewals, stream of income,” Summerallsays. “If the agent ever wants to sell their agency to someoneelse, those renewals go with it. A lot of insurance companiesactually own that business, and they just pick another agent to putin there.”

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Once Summerall is able to accompany a broker to a client'soffice, Summerall often overcomes a current client objection thatemployees would likely not buy any voluntary benefits becausethey've just had a pay cut or they haven't had a pay increase inyears.

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Summerall counters that by showing spreadsheets of recentenrollment ratios of voluntary benefits by other local companies.Not only do clients see that employees are, indeed, selectingbenefits such as gap health insurance or life insurance, they alsorealize they may need to offer these things to remain competitivein the labor market.

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'I Don't Have Money'

Once Summerall can get access to employees, the most commonobjection he gets is that they don't have any money.

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“I tell them, if you don't think you have any money now, what doyou think would happen if you become disabled or died and then yourfamily would be really suffering financially?”

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“Generally you can avoid objections by first describing theproblem, getting the broker or the company or the employee to agreethat there is a problem, and then you propose the solution,” hesays. “If you don't describe and get them to agree that there's aproblem, it's much easier for them to come up with objections.”

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Elizabeth Halkos, chief marketing officer of Purchasing Power,an Atlanta firm that offers employee purchasing programs throughpayroll deductions, says brokers should take more of a consultativeapproach, strategizing with their clients about benefits, helpingclients understand their employee base and how to segment thatbase.

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“Instead of hard-selling benefits and getting an immediate pushthat gets the objection, 'I've got other priorities in this economyand there's a lot ofpressure on me for cost cutting,' brokersshould have more of a consultative approach, working with employersto identify types of benefits different segments of the employeebase may need, based on the identity of the segment,” Halkossays.

Long-term focus

Brokers must get their clients' to focus on long-term goals fortheir program, because impacts to cuts in services on employeeengagement and retention may not be seen in the short term, shesays.

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Michael Lovas, who authors books on professional credibility andthe psychology of marketing and selling in the financial industry,says benefits professionals should not initiate their conversationswith prospects by asking open-ended questions, because HRprofessionals don't have the time—and often the comfort level—todelve into long-winded discussions with someone they've justmet.

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Moreover, asking relevant follow-up questions will be the key todemonstrating that the benefits professional is actually listeningand responding in ways that could meet their specific needs, Lovassays.

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If prospects still say no or 'not at this time,' Lovas suggestsleaving them with ideas to ponder about opportunities they mightnot be seeing.

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“You might not get their business right away, but you never walkaway without having some kind of forward movement—you might justget another meeting,” he says.

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