A good health insurance broker is worth its weight in gold. Many small and mid-sized organizations lack internal resources due to budget constraints. This is where the innovative companies win: by rethinking the way they deploy external resources to supplement their teams, keeping overhead low, and running lean. These organizations turn to their brokers.
There have been several factors in the last 10 years, led by the Affordable Care Act, that have changed who brokers work with and what they do. Many national firms have shifted their focus and moved upmarket and the void has been filled by “faceless” brokers who offer a self-service model. Business Insurance Magazine’s 2018 list of the Top 100 Brokers of U.S has Paychex, a payroll company, ranked #20 with over $226 million in annual revenue. ADP’s insurance agency trails Paychex but will likely be climbing the rankings as years go on. The challenge with working with these payroll companies for your insurance is that they treat service the same way they do payroll clients: through a call center and a passively managed email inbox.
Partnering with a large, faceless broker is wasting what could be an invaluable resource.
In addition to payroll companies, brokers (large or small) who refuse to take on responsibilities outside of insurance are also hurting your business. In the under-50 employee small group market, health insurance rates are fixed. Aside from changing funding options and strategically using voluntary products, there isn’t anything your broker can do to “save you money.” Understanding this fact is critically important. With insurance becoming a commodity in the SMB market segment the question must become, “what else is your current broker doing to support your organization?”
The right broker for a SMB organization is one who can help not only with insurance but also drive productivity. This missing layer of people support may be the answer to your organization’s productivity gap. According to a Deloitte study (graphic listed below): as technology advancements are increasing rapidly, human productivity is severely lagging. Technology is purchased and implemented to be the tool that frees employees to become more productive, but that isn’t translating to productivity.
With internal resources limited in the SMB market, money is being left on the table by not evaluating and maximizing strategic partnerships, starting with your health insurance broker. The right broker may be the key to unlocking the productivity growth you were looking for when you purchased your HCM technology.
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