Crains Brokers’ Commissions Face Uncertain Future. A quick comment on our quote in Crains “Crains Brokers’ Commissions Face Uncertain Future” today. Insurers are indeed cutting back on services resulting in cost containement measures such as layoffs, outsourcing and significant broker commissions cuts.
A significant negative development is the NYS decision to not allow licensed Agents/Brokers in the Individual Exchange. Many States such as Massachusettes, the inspiration for Health Care Reform, use a Connector which is an Exchange or an independent state agency that helps Massachusetts residents find health insurance coverage and avoid tax penalties. Instead NYS will allow Agents/Brokers to only work in the Commercial Exchange known as SHOP. HealthPass is a good pre-cursor of the SHOP Exchange offering Small Businesses a Defined Contribution Health Plan of full options form Health Insurance, Dental, Vision to Term Life Insurance and Disability.
The Individual Exchange will work with an “Assitor” or “Navigator”. In NYS Government and Non-Profit Agencies will comprise the “Navigator” which will only be allowed to operate in the Individual Exchange. By design an income subsidy will only pass through this Individual Exchange an not on the SHOP Exchange. Example: a $50,000 Family Household of 4 can get approximately 80% credited.
The Federal Gov has already spent $2.2 Billion on State Exchanges. And this figures does not include remaining States as there are only 19 States working on an Exchange for 2014. The Exchanges will be built up for 2 years and then must be fully independent by 2016. If 88% of small groups coverage purchased by Brokers acc. to Bostons Wakely Report in research study- Role of Producers and Other Third Party Assisters in New York’s Individual and SHOP Exchanges the distribution infrastructure is already there. Access to care is not the difficulty in finding a plan its the very cost of the plan! Why then does NYS decide to spend on building up new infrastructures? AgentsBrokers can easily outreach and council to uninsured as well. In fact many small businesses such as construction, consulting services and dining have many uninsured that an Agent/Broker already has a relationship with.
Despite all this and the rapid changes in reshaping health care we remain optimistic and look forward to taking on a greater role in health care reform.
With more choice, our groups and their employees will need more direction, allowing brokers to take on more of a consultative role. Healthcare plans are not a simple purchase and one plan doesn’t fit all. By delivering the latest cutting-edge benefits technologies, continued consumer focus approach and leveraging our long time relationships with Benefits/HR/Payroll partners our role will be pivotal in being part of the solution.
Pulse Nov 2012 Quote MMS
We are pleased to announce our 10th year anniversary this past March. Back in 1998, the average HMO was only $325/month with office copays at only $10. Then again, gas prices were $2.50, there was Monicagate saga, Google was just a neophyte startup, the Y2K looming as the world’s demise, Seinfeld was still funny, and the US dollar dominated.
At the time, I was working out of my home office wondering will I get a client before my unemployment checks run out? I was short on time and money for creating a web presence, organizing a marketing plan and seeking outside lending. I was way in over my head as they say.
Healthcare was volatile at the time with carriers shifting the costs burden onto businesses. I suppose nothing has changed in 10 years with the exception of less companies vying for our business as consolidation was abound. Since that time, Aetna bought U.S. healthcare which bought NYL Care and PruCare. Oxford almost went out of business, their stock dropping from $86 to $6 in a matter of weeks. Five years later United Healthcare bought out Oxford. Empire survived 9/11 but was bought by WellPoint 2 years later. The Blue Crosses stopped competing against each other with Horizon Blue Cross dropping out of NY and Empire leaving NJ.
At the same time, new players have entered the industry. Healthpass has become a great way for small businesses to offer multiple plan options and carriers and compete with larger corporations. Atlantis Health Plans has become a medical inflation controller with rates still below $300/month. There was no Healthy NY to offer state supplemented corporate plans. The online functionalities has also evened the playing field for small businesses by keeping costs down, reaching the end users quickly and carving market niches.
By being a small business ourselves, this experience has made us more in tune and sensitive to our client needs. We are batting virtually 100% with claim and billing disputes and help employers maximize their benefits while discovering market inefficiencies. Borrowing from Google’s creed, “don’t be evil”, has helped us grow to over 300 employer groups and over 3500 members strong.
We are proud of our achievements and have been awarded the industry’s 2008 NAHU Golden Eagle Award for outstanding sales & achievement. Last summer’s move to Armonk, NY has allowed us to merge with a long time Property & Casualty brokerage firm, Avanti Associates. This will give our clients competitive markets for building, auto, malpractice insurance, professional liability and workman’s comp that they may not have had.
What’s next? We are ramping up an HR Kiosk service from the existing “physician locator” and “forms warehouse” links on our website. Many of you have already been using these tools when shopping for the annual plan renewals. But what about offering an intranet like kiosk where your employees can view, for example, their Aetna medical and Oxford dental plans from on one site? Or having the ability to post HR policies on vacation days, COBRA information or 401k documents?
We’ve enjoyed our experience and learned a lot from challenges faced but we really learn the most from our clients at the end of the day. You are the reason we have been fortunate to be in business and we depend on your suggestions and referrals to sustain our business model. We offer many extra’s and help you stretch your healthcare dollars as a way of thanking you and hope to continue to grow as a valuable part of your business.
Finally, I want to congratulate my brother Jonathan on his recent marriage this past Valentine’s Day. Also, he has dedicated 5 years at MMS, Inc. and I owe him a world of gratitude for realizing many of the goals of the firm. He has distinguished himself from a young college grad to a marketing and accounts manager who runs everything from renewal proposals to managing the day to day nuts and bolts that makes the agency work.