Selling Group Health In This Market

[njinsuranceguy]

Why would an owner pay a portion of the employees premium when the Fed. Gov. will pay it? That is the question that small group owners have to answer.

I agree with this. I think the employer leaves a lot on the table if they do. I've been saying for about a year that group policies will probably go away in a year or two tops. Only thing that will keep them going are bad brokers that keep employers in it.

With that said, I think there is a real opportunity in working fee based with employers by helping them in developing individual plan arrangements that still allow the employers to provide money for coverage but not group coverage.

So, by saying I believe in group... I mean in by working with employers. The policies will most likely be individual policies but I still consider the employer a group for fee purposes.

 

[leevena]

I agree with this. I think the employer leaves a lot on the table if they do. I've been saying for about a year that group policies will probably go away in a year or two tops. Only thing that will keep them going are bad brokers that keep employers in it.

With that said, I think there is a real opportunity in working fee based with employers by helping them in developing individual plan arrangements that still allow the employers to provide money for coverage but not group coverage.

So, by saying I believe in group... I mean in by working with employers. The policies will most likely be individual policies but I still consider the employer a group for fee purposes.

For some employees they will have a subsidy. What do you tell the employer when they have employees who will not qualify for any subsidy and are now looking at an individual cost of $20k per year?

 

[njinsuranceguy]

For some employees they will have a subsidy. What do you tell the employer when they have employees who will not qualify for any subsidy and are now looking at an individual cost of $20k per year?

Good question.. thats where as brokers we need to do our homework. I spent about 20 hours last week crunches all the numbers for a client with about 30 employees. Running 30 different quotes, determining potential subsidies, spread sheeting everything I could etc and I believe it works very well as long as you have a company with enough employees receiving a good amount of subsidies. Obviously, if you have a small firm with no one qualifying for subsidies, then whats the difference. Group and Individual is basically the same now.

So, it can be done with some creative thinking.

 

[leevena]

Good question.. thats where as brokers we need to do our homework. I spent about 20 hours last week crunches all the numbers for a client with about 30 employees. Running 30 different quotes, determining potential subsidies, spread sheeting everything I could etc and I believe it works very well as long as you have a company with enough employees receiving a good amount of subsidies. Obviously, if you have a small firm with no one qualifying for subsidies, then whats the difference. Group and Individual is basically the same now.

So, it can be done with some creative thinking.

But your statement was that "group plans go away in a year or two" contradicts this.

 

[njinsuranceguy]

But your statement was that "group plans go away in a year or two" contradicts this.

Your right but reread what I was saying... I am considering the employer to be a "group" and my fees to be based on the "group"... the policies and recommendations will most likely take a big shift towards individual policies and away from the traditional group policy but I still consider this "group" business.

As opposed to calling individuals at home and selling policies one by one, I will still be calling on employers or groups. But yes... I do believe that group insurance policies will most likely go away in a few years. At least in my market.

 

[leevena]

Your right but reread what I was saying... I am considering the employer to be a "group" and my fees to be based on the "group"... the policies and recommendations will most likely take a big shift towards individual policies and away from the traditional group policy but I still consider this "group" business.

As opposed to calling individuals at home and selling policies one by one, I will still be calling on employers or groups. But yes... I do believe that group insurance policies will most likely go away in a few years. At least in my market.

k, thanks appreciate the insight.

 

[CABenefits]

I'm in the Central Valley in California and what I'm seeing is groups under 10 lives are unsustainable with 20-30% rate increases unless the business is paying 100% of premiums and can shift some of that to the employees. Or if the business has high income positions such as doctors, engineers, CPAs, etc. Your typical service business, restaurant, mom and pop shop won't keep the group plan. I have a handful that have already moved to individual for January 1st. So far 15 groups that are dropping. I am enrolling and BORing a record number right now. If I had more time I could reach more but I have a large book of individual business I'm sifting through and rewriting off exchange and in. I'm also seeing more interest in dental and vision where the employer feels the need to provide it after sending his group to buy individual plans.

 

[SamIam]

But if the employer pays for dental vision or accident plan doesn't that count against the employee for a subsidy.

 

[Ann H]

But if the employer pays for dental vision or accident plan doesn't that count against the employee for a subsidy.

No, that does not impede a subsidy. Only employer-sponsored major medical insurance would cause a block to a subsidy, and only if it is meets the ACA tests of adequate and affordable.

 

[Happy Texan]

I agree that this could be an excellent time for companies who think out of the box.
I am the President of National Prosperity Life and Health. We have a patented health insurance product, which provides a paid-up benefits rider as an "excepted benefit." Doing so allows us to design this first piece of coverage as we like, as long as all the pieces combined are ACA compliant.
For a nominal charge for the rider, premiums can be reduced 60-80% over 36 to 60 months.
This plan will be available to select large employers of 200 or more employees in 2014, who self insure.
It will be in the fully insured market in Texas in 2015.
Don Levit,CLU,ChFC