(PRWEB) April 09, 2014
The first quarter of 2014 pushed health insurance brokers’ limits farther than they have ever been. Plan changes, carrier delays, employer education, employee confusion - saying they have been busy would be an understatement.
Not long ago, many brokers feared they wouldn’t even make it this far. It turns out…producers are adapting quickly to the post-reform world, though many challenges remain.
Carriers have put brokers on notice that the potential for bonuses and other incentives will soon be gone. Most have already prepared themselves for the decline in standard commissions, which are also sure to come. With compliance and performance targets that need to be met, health plans are putting the squeeze on producers in order to make room for these costs.
If that wasn’t enough, now more than ever, brokers are being asked to do more for less.
This is the largest change in our industry that most of us have ever seen. With change, there will be those that are prepared and will grow; there will also be those that wish these changes would all go away and be pushed out of their market space. One thing is for sure: many brokers will be acquired over the next few years — a clear sign of the pressure to achieve economies of scale while meeting the increasingly sophisticated demands of the market.
This year brings on a whole new set of challenges. Employers are educating themselves and asking tough questions, expecting their broker to help them make important health care delivery decisions. Double-digit increases are being seen nationwide, something employers cannot sustain.
Forty-five percent of employers have implemented, or plan to consider using, a private exchange for their full-time active employees before 2018, according to a new employer survey conducted by the Private Exchange Evaluation Collaborative.
Organizations that have the ability to invest in or develop their own private exchange will be few and far between. Trying to enter into the game this late puts many firms at risk with competitors who were quick to adopt a strategy early. The smart broker will align themselves with a strategic technology partner with the resources and experience to deliver systems that will ease the burden of administration and use technology to do more with less.
The Connecticut based technology provider ebenefit Marketplace provides firms nationwide with the tools and resources to run a private exchange branded for their organization and their clients.
“We don’t expect brokers and advisors to learn what we have entrenched ourselves in over the past years,” says Frank B. Mengert, Partner & Director of Exchange Technology at ebenefit Marketplace. “We provide one of the best private exchange technology solutions on the market…with no implementation fees…and we do all of the heavy lifting.”
The next few years will be challenging for producers as they attempt to retain their client base in an industry that is more competitive then ever. Rates are rates, and our business is now forged by the partnerships the smarter advisor brings to the table. Those that can play a strategic role in administration, as well as those who create craftier ways for employers to control costs through Defined Contributions, will be the ones that survive.
The producers left standing will not be the same brokers we see today. The days of spreadsheeting and once a year client visits are gone. Advisors of the future will leverage technology into their offerings to ensure compliance and remain competitive.