What to Expect from your Health Insurance Broker
By Brenda Gilchrist, Principal of The HR Matrix, llc
Top 10 things to expect from your company health insurance broker. Yes, it is important to have a broker of record if you offer group health insurance to your employees. A great broker understands all the plan options and various ways to design a plan that fits your needs. Plus, you can refer your employees directly to the broker – you don’t want to get involved (or even know) about the claims due to privacy regulations and the Health Insurance Portability and Accountability Act (HIPAA) of 1996. Also, the broker can be an advocate for your employees when the insurance companies fail to pay claims or refuse to pay claims. Here are my TOP 10 things to expect from a great broker:
1. In Depth understanding of Benefit Solutions; anyone can sell insurance – you need to select a broker that can do more than just get insurance quotes! An exceptional broker has an in-depth understanding of the various products available and can have a strategic-level discussion to understand how to align benefit plan options with your operational, philosophical and financial needs. If you only get quotes for insurance products and your broker doesn’t discuss “out of the box, creative solutions,” then you need to find a new broker. Your broker should be able to discuss options such as, self-funded plans, HSA’s, HRA’s, direct reimbursement plans, reimbursement plans for individuals, executive benefit options (carved out plans for key employees), voluntary supplemental options, FSA, etc. Your broker should also seek to understand your unique needs and craft a plan design to make sure your healthcare coverage meets your needs (i.e. an HSA may not be the best option for everyone).
2. Availability; you should see and hear from your broker throughout the year. If you only hear from them one (1) month before open enrollment, you should be looking for a new broker. Exceptional brokers will meet with you mid-plan year to discuss your business needs, usage, evaluate your current plan design to determine possible changes for the new plan year (including, designing a good communication plan to tell employees about potential changes well in advance, such as cost-sharing changes, rate increases, etc.)
3. Direct Access to an assigned benefits representative for employees; your broker should provide your employees with a direct contact person (name/phone#/email) at their office to call or email for claims questions, benefit coverage levels, claim problems, etc. I expect the brokers to create and pass out a wallet size card (or at least a flyer) with their contact information, along with names and numbers of each carrier. If you have an online benefits portal, this can be posted online on the “contacts page”. The assigned representative should be responsive and return calls within the same day or no later than the next day. Note: due to the new HIPAA and privacy laws, you want to make sure your employees are only revealing their medical conditions, claims, etc. to the broker – you don’t want to know (nor are you suppose to ask) about an employee medical diagnosis or condition. In some cases, the broker may need to get a release signed by the employee to help them with HIPAA related matters (in some cases, the insurance carriers may require employees to call them directly).
4. Side by Side Comparison; prior to and during open enrollment, the broker should prepare a side by side comparison table for you to easily view each insurance option against each other. For example, for medical insurance, your broker should prepare a table, listing each insurance benefit next to the other, so you can easily compare the benefit plan design to the other. If you don’t get this, you should be looking for a new broker. If you only have one medical plan option, you don’t need this.
5. Education and Communication Materials for Employees; your broker should be preparing professional marketing materials to communicate your overall health and wellness package to employees. Brokers should plan and coordinate your annual open enrollment benefit meetings, design the open enrollment kits and enrollment forms, benefits summary and plan documents, and personally present the new plan design during employee meetings. For mid-to-large size companies, this includes the broker making arrangements for representatives from each insurance carrier to be present at the meetings.
6. Health Fairs; for mid to large companies, your broker should be coordinating your annual health fair for employees to attend. The broker should invite representatives from each carrier, help you develop a theme to encourage health and wellness and to help you market the value of the program and show that your company cares about health and wellness. At health fairs, brokers should help companies coordinate a fun event, such as, including healthy food, massage therapist, giveaways, games to test their knowledge of health, etc. This should be a fun and memorable event for employees. At one healthfair, I had the President of the company dress up as an apple and pass out invitations to the upcoming health fair – it was a big hit with staff, plus it showed that the President really cared about his staff (MBWA).
7. Administration; exceptional brokers provide outsourced benefits administration, including processing your new hires, terminations, Cobra, HSA and FSA, and bill reconciliation. Plus, your broker should be offering you online enrollment and employee self-service options. If your employees are still going to a person in your office to get their enrollment forms or to get their plan coverage options, then you need a new broker. The exceptional broker will offer you (sometimes, at their cost) online systems like Benetrac, Wage works, Cobra serve, and others that will streamline and automate your benefit program. (note: for small groups, insurance companies still require, in most cases, that employees fill out a paper enrollment form, in addition to your online enrollment process). Small groups can request their broker to vet vendors and costs for them.
8. Annual Benefit Statement; exceptional brokers will help you to educate your employees on the value of their “total cash compensation” by creating and providing your employees with a printed (or online version) of their individual benefit statement. These are usually rolled out to all employees during performance review or merit increase time to show employees the total value of their compensation and benefits package. The statements are usually professionally designed by your broker. You provide the data and the broker develops each statement. The statements usually have a pie chart depicting the value of each benefits; base salary, retirement, taxes, insurance premiums, bonuses, etc.
9. Legal; your benefits broker understands and ensures your plans are in compliance with the federal and state laws. For example, if you allow employee to take “pre-tax deductions” for their insurance premiums or you have an FSA, you need to have a section 125 plan document. Your broker should provide you with a customized section125 document. Your broker should understand all the new laws, including the ins/outs of cobra, benefit compliance, etc. If your broker refers you to an attorney – you need to shop for a new broker!
10. Benefit Surveys (internal and external); exceptional brokers understand that benefits (medical, dental, vision, life, disability, FSA’s, key man insurance, etc.) are a tool to Attract and Retain employees; a great broker understands the value of conducting a market scan to evaluate your company against the market to determine if your plan design is competitive (or not). If not, your broker can help you evaluate solutions to compete in the market place and ensure your plan design is competitive, valued and affordable. In addition to external market surveys, your broker can help you conduct an internal employee survey (ask your employee’s their opinion regarding the perceived value of existing plans and what they would like added to the plan). Exceptional brokers will provide you with a survey template and (in some cases) collect and analyze the data for you!
About the Author: Brenda Gilchrist, Principal/Cofounder of The HR Matrix, llc, a full-spectrum Human Resources, Organization Development and Search firm. Brenda specializes in helping companies design effective HR strategies and programs. For comments or to contact the author, email Brenda at Brenda@thehrmatrix.comor call 707-526-0877 x11. www.TheHRMatrix.com