Group Health Producers

[warrenins]

Couldn't agree more with you MelMunch in the advise you've given for this topic. Large Group is another animal altogether, and if you don't treat that animal right the teeth get bigger and bigger waiting for your butt

 

[bcbroker]

dandan, I say this with respect but if "you don't do group" and you're talking about helping a group as large as 125+ employees you'll be doing your friend a huge disservice if you try to wing it or get a couple ideas off a message board.

If this guy's really your friend suck it up and contact a group expert and arrange a commission split.

I agree, Show the same consideration for your client as he has shown to you.
He obviously trusts you, so don't disrespect that by doing a huge disservice by trying to wing it on your own. Your client will probably figure out very quickly if you know what you are doing because he will talk to other agents and soon discover your shortcomings. I've seen guys like you before who have been in this situation, only to lose the client and the friendship forever.

 

[NewHealthStrategies]

I have a question for the group producers.

I have a good friend who has a company with 125-130 employess, he knows I don't do group but he wants me to be his agent and quote the group anyway. He said he would give me a agent of record letter, but wants me to get creative with his coverage. He has a traditional ppo 1500 ded, $30 co pay 70/30. Any suggestions?

Okay... can't beleive I'm spending my Monday night doing this.... but I'm a sucker for helping people understand this business. By the way, my credentials.... Golden Eagle Top Producer (only 1 in 5 in the Atlanta market) from NAHU for the last 2 years. Built the largest PPO in the State and was President of three Georgia HMO's..... past clients have been;;;;;; State of Georgia, Vanderbilt and PROMINA Health Systems (11 hospitals)....so just step out on a limb and go with what I tell ya......

Forget the claims data... a group of 125 doesn't have a prayer of influencing rates/claims... although I'd at least review it so I can see any really large claims that hit them the last few years (which would prove my point very vividly).

God, I pray they are FULLY INSURED... if not.... all bets are off and it's a different discussion.

Assuming they are FULLY INSURED.... do the math on an HRA... Health Reimbursement Account. NO HSA's... they don't work for an employer.... but the employees really like 'em.... get my drift here? Work on behalf of SAVING THE ER MONEY..... let the ER decide whether the savings you can generate will go to lower EE costs or not.... THIS WILL GET YOU BIG KUDO's FROM THE ER.

Raise the deductible on the plan from $1500 to $2500 and fund the HRA with a portion of the savings at only $500... be sure to compare the OOP max's so that it's not out of line.... try to keep the OOP max the same if possible.

The savings will be calculated through a decrement in the premium (a lower cost for those not from Rio Linde)...... Let's say you say $75 a month per employee.... times 125 employees... that's (oh for heaven sake...where does Windows put that calculator thing.....hold on) that is a $9,375 savings PER MONTH. Times 12 months is an annual savings of $112,500.......

NEXT STEP: Put an HRA document together that reimburses EE's ONLY after they spend their $2,000 (the original $1,500 and then the bumped up $500) and only for hospital or out patient prodedures..... in other words, keep the co-pays coming out the EE's pocket.

Trust me when I tell you that there isn't an HRA TPA in the country that will tell you that no more than 30% of that money will ever get touched.....

Do back to that danged calculator....this means that the ER will reimburse employees $33,750 for the expenses... this lowers the financial exposure from $2,500 to $2,000 for all the employees... in all but rare circumstances and the employer can pocket the difference of $78,750

There is a lot of work you'll need to do make sure this works, but just take the decrement page from the renewal they got and it'll do the math for you most of the way.

Email me if you want more help..... I won't split commissions.... you can just buy me a dinner or lunch or something......

Let me know if this helps.

 

[Sam]

Some good info.

Trust me when I tell you that there isn't an HRA TPA in the country that will tell you that no more than 30% of that money will ever get touched.....

We have seen utilization above 50% for a few of our clients. 30% or below is an average, but it is hard to sell on averages.

Anyway, your numbers still work at 50%.

 

[NewHealthStrategies]

I am moving my practice to solely beating up employers and individuals on the 10 STUPID THINGS EMPLOYERS DO WITH THEIR EMPLOYEE BENEFIT MONEY.... they complain that costs are out of control and then buy $20 copay plans for their employees..... unless they get EE's into a "skin-in-the-game" arena, they will NEVER get a handle on costs....

Why do I feel this effort will be the same as when I tried to convince people there was a difference between health CARE and health INSURANCE.... no one listens to me....... can I interest you in some Melaluca-Noni-Juice?

 

[somarco]

Built the largest PPO in the State and was President of three Georgia HMO's

Which ones?

Care to put a face on your identity or do you prefer to be anonymous? Only reason I ask is, I have lived & worked in Atlanta since '78. Chances are we crossed paths at some point.

I am moving my practice to solely beating up employers and individuals on the 10 STUPID THINGS EMPLOYERS DO WITH THEIR EMPLOYEE BENEFIT MONEY.... they complain that costs are out of control and then buy $20 copay plans for their employees..... unless they get EE's into a "skin-in-the-game" arena, they will NEVER get a handle on costs....

No argument here.

I will say very few are willing to return to the "old ways" (before copays). Over 90% of my clients have jettisoned copays & low deductibles, but I shifted to smaller groups and individuals a few years ago. They are more receptive to change than employers.

Just my observation.

a difference between health CARE and health INSURANCE.... no one listens to me.......

That's because they watch CNN and put their brain on autopilot.

 

[Chkndinner14]

Good information here, thanks!

How small of a group can an HRA plan work? Any rules of thumb?

Thanks.

 

[Delta76]

How small of a group can an HRA plan work? Any rules of thumb?

I've used them down to a two person group. If the plan is designed to reimburse medical expenses, many times a group that small will decide to pay for the document (around $300 with the administrator I use) and administer the plan themselves. Others see the value in paying a small monthly fee to not have to deal with it.

 

[NewHealthStrategies]

You can do this with a two man group like Delta76 states, but the numbers aren't as impressive...but the percentages work well. I used to sell AGAINST HSA's all day long for business owners, but the HOPE raised the contribution ceiling to basically double the floor deductible and it's a no-brainer for any cash-rich business owner to now own an HSA.... I mean a really, doesn't come around very often no-brainer......

So, look at offering an HSA for highly paid and HRA.... but boy that gets messy...... hell...... just give a check and let 'em get their own individual coverage..... DAMN.... that won't work either because it'll violate one of the sacred 3 legs.... ERISA, DOI or HIPAA......

Good luck with that...........



What exactly is the purpose of the last nail in a coffin?

 

[Delta76]

One thing that can work well if the conditions are right is to offer an HRA plan for the employees and have the owner buy a individual policy for his needs. Doesn't always work, but if the owners family is healthy and in a small group, doesn't affect participation requirements, it can work well.