Benefit Advisors, It's About to Get Real

Kevin Trokey on August 06, 2018

You don’t have to scroll very far in your social media timeline to see the posts of outrage and calls for transparency aimed at the players in today’s health care/insurance game.

And, rightfully so. The waste, fraud, and at times, seemingly criminal behavior of the BUCAHs, pharma, and healthcare providers is a travesty. It has to change. All of these guilty players need to be called out, held to a higher standard, and be forced to account for their contributions to this mess we struggle with every day.

Oh, it’s happening sweetheart

The Bezos-Buffett-Dimon (B-B-D) healthcare venture is heating up. While I have my serious doubts about their ability to solve the crisis (I believe that, as with most movements, will happen on a much smaller, much more local scale), there is one thing that this trio will certainly bring and that is visibility and outrage to the mess and do so at a level we can’t even yet begin to fathom.

With all due respect and reverence to the #MeToo movement, and others like it, I predict B-B-D will similarly open the floodgates of horror stories from victims of the travesty that has befallen our healthcare system at the hands of providers of care, insurance carriers, and big pharma.

We will see and hear, at the most publicly visible level, the telling of stories we are already sharing within our relatively small inner circle on a daily basis.

  • Stories of lost lives due to inaccessibility of care.
  • Stories of couples who choose to divorce so their child can get the care they need.
  • Stories of medications and medical treatment that cost multiples of what they should.
  • Stories of the artificially inflated health insurance premiums that have kept businesses from growing and achieving their profit potential at the expense of the profit of the insurance carriers.

I can feel you getting excited. I can hear you saying, “bring it on B-B-D!!”

Be careful what you wish for

The spotlight that will be the B-B-D venture will be shone in every perceived dark corner of the system with a particular intensity on anyone seen as a middleman. If you aren’t concerned yet, you should be.

Make no mistake benefits advisors, you will be next.

In addition to the stories above, there will also be stories of brokers being paid $50,000/$100,000/$250,000 on a single account for “simply selling a policy.” 

Get out in front of this tidal wave

I know most of you who read our posts work your asses off every single day with the best interests of your clients clearly in mind. I know the decisions you help your clients make are some of the most complex made in their business. I get it.

But, perception is reality. And you need to brace yourself for the picture B-B-D is about to paint of you. Be prepared to deal with the perception of being nothing more than the distribution channel of the carriers, a middleman.

You know the carriers, who many of you attack yourself on a daily basis, are going to be a very big, very sexy target of the B-B-D media machine. What you may not know is that you are going to be seen as a part of that same target.

When your compensation ties you directly to the carriers; when you are contractually tied to the carriers more closely than you are to your clients; it is going to be very difficult to separate yourself from the carriers.

Sorry, but it’s true.

You don’t even need tea leaves to predict this one

A recent article about this venture is titled, in part, “Eliminate the Middlemen” and specifically addresses both pharma and, hold on, brokers.

You are already being painted as an overpaid, taking-money-on-the-side, not-making-the-recommendations-in-the-best-interests-of-employers, middleman (go read the article). That sound you may be trying to not hear is one of the gauntlet being thrown down, hard.

No time to spare

Now is the time to be re-engineering your business to separate yourself from the carriers and to formally serve the clients you have always served altruistically. I get that there are significant changes you will have to make, many of which are not going to be easy. But there are a couple of things that are relatively easy that will take you in that direction.

  1. Sit down with each of your clients and have a stewardship meeting where you explain very clearly the various ways in which you bring them value. 
  2. During that meeting, have a transparent conversation about how much you are being paid by them (via commissions built into the premium) for delivering that value. If possible, let them know you will be asking the carriers to remove your commissions and ask them to pay you directly in a fee-based arrangement.
  3. Finally, educate them about what is broken about the system and the solutions we are starting to see in the industry. Let them know you will be there to help them take advantage of every innovative solution that makes sense for them.

I get that these may be difficult discussions to have but, I promise you, they are nowhere near as difficult as the defensive discussion you will have to have if you wait for B-B-D to tell a story on your behalf. 

Don’t believe me, just ask the carriers who have been on the receiving end of your daily attacks.

 

Photo by Kevin Carden 

Insurance Agency Sales | Q4i Growth Platform

Topics: Agency Development