B2B

[Colorado Newbie]

In Colorado as a health insurance agent you cannot walk into a business that has more than 1 employee and solicit business other than group. So no walk and talk here for indies just groupies.

DOI takes this very seriously here. Whenever a potential client wants to discuss individual health insurance at their place I business I always refuse. A few times I've had people say "hey they last insurance guy I talked to did not care about that" My reply is always "who do you want to work with, the guy that knows and abides by the laws or the guy that does not?

 

[somarco]

The DOL & IRS are bigger threats to marketing individual policies via employers. Especially if you use PRD for premium payments.

If you are not careful the plan can be deemed to be an ERISA plan, subject to non-discrimination rules and tax liabilities.

I can't speak for CO, or other states, but I do know how carriers, the DOL and the IRS interact when it comes to employee benefit plans.

 

[Crabcake Johnny]

That would have a potential impact on these list bill deals.

 

[LGilmore]

In Wa group is far, far better than individual bells and whistles wise. Groups start at 2. We can't list bill individual anymore for business. I guess it would depend on states but there are several erisa type issues about going individual and the er paying the freight. I would tread lightly in this area, but I can understand it if group is really an inferior product than individual in your states...

 

[somarco]

I wouldn't call group inferior, just pricey and a limited range of deductible choices.

Great if you have insurability issues, but otherwise, it really bites. Typically at least 50% more than comparable individual coverage. Higher if you have health issues.

I use small group when I can't get someone covered in an individual plan.

 

[Delta76]

I wish I knew the answer to how this actually works in my state. I have yet to get a clear answer. The head sales coordinator at one of my main carriers supports breaking up small groups, but warns that you should consult legal councel (gee, thanks). I have found many situations where it's a better fit for individual coverage, but I'm weary each time I do it. The biggest producer friend of mine is doing big numbers with this strategy, but I can't get myself to do what he's doing:

1. We can't list bill in our state for individual health. He has the employees pay for their coverage out of their pocket and runs it through a Sect. 125 Premium Only Plan. I can't see how that would be legal. The employer has no idea whether the employee dropped the coverage or not and still writes the premiums off as pre-taxed. I've used Sect. 125 plans, but the employee has to prove they paid each month (much more burdensom to administer)

2. The employer gives the employee a reimbursement for the exact amount of their coverage cost. We have a state law that bonuses can't be tied to health coverage. Difficult to prove otherwise in this case.

This producer is doing this with 100 employee companies and making a killing. I use the concept in the right situations, but use an equal bonus for each employee (or an equal pay raise %) and use a Sect. 125 plan, however, the options are limited when employees are in totally different age brackets. The administartion of the plans becomes a burden also with birthdays and rate increases throughout the year.

 

[J.R.]

I wish I knew the answer to how this actually works in my state. I have yet to get a clear answer. The head sales coordinator at one of my main carriers supports breaking up small groups, but warns that you should consult legal councel (gee, thanks). I have found many situations where it's a better fit for individual coverage, but I'm weary each time I do it. The biggest producer friend of mine is doing big numbers with this strategy, but I can't get myself to do what he's doing:

1. We can't list bill in our state for individual health. He has the employees pay for their coverage out of their pocket and runs it through a Sect. 125 Premium Only Plan. I can't see how that would be legal. The employer has no idea whether the employee dropped the coverage or not and still writes the premiums off as pre-taxed. I've used Sect. 125 plans, but the employee has to prove they paid each month (much more burdensom to administer)

2. The employer gives the employee a reimbursement for the exact amount of their coverage cost. We have a state law that bonuses can't be tied to health coverage. Difficult to prove otherwise in this case.

This producer is doing this with 100 employee companies and making a killing. I use the concept in the right situations, but use an equal bonus for each employee (or an equal pay raise %) and use a Sect. 125 plan, however, the options are limited when employees are in totally different age brackets. The administartion of the plans becomes a burden also with birthdays and rate increases throughout the year.

What does he do with the insurables? I thought about doing the same thing in MD with smaller employers, but list bill is not allowed for small groups.

 

[Delta76]

What does he do with the insurables? I thought about doing the same thing in MD with smaller employers, but list bill is not allowed for small groups.

Assuming you meant "uninsurables", we have a guaranteed risk pool that is reasonably priced (capped at 25% above the private market). We also can't list bill, but you can still get a pre-tax deduction using a Sect. 125 individual premium reimbursement plan. That being said, unless you have a small business (under 5 employees), it can be a pain in the ass to administer. I've taken some of my small groups this direction when we have one person in a small group creating a substantial rate increase for the rest.

 

[moonlightandmargaritas]

What does he do with the insurables? I thought about doing the same thing in MD with smaller employers, but list bill is not allowed for small groups.

Assuming you meant "uninsurables", we have a guaranteed risk pool that is reasonably priced (capped at 25% above the private market). We also can't list bill, but you can still get a pre-tax deduction using a Sect. 125 individual premium reimbursement plan. That being said, unless you have a small business (under 5 employees), it can be a pain in the ass to administer. I've taken some of my small groups this direction when we have one person in a small group creating a substantial rate increase for the rest.

This is a dream scenario for the defined contribution employee health plan using IFP and a Section 105 HRA.

You don't need or want list bill - it's archaic anyway.

With Section 125 you're missing the forest for the trees.

If it wasn't so damn cold in the winter, I might move to Minnesota!

 

[somarco]

If it wasn't so damn cold in the winter, I might move to Minnesota!

Become a reverse snowbird.