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Employee Benefit Strategy Recommendation

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by

Wayne Barber

on 11 November 2013

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Transcript of Employee Benefit Strategy Recommendation

Employee Benefit Strategy 2014 and Forward

The objective - Win with Employee Benefits
Group Benefit Plans are still a rational choice
What if we do nothing?
1st Strategy
Association Plan - if available
2nd Strategy
BB&T Private Exchange
Describe the current situation
Health Care Reform has changed the game. In the small market (<50 FTE) Healthy, Higher income families will subsidize the cost of medical insurance for others when renewing in 2014.
The Desired State
Higher Margins - Engaged Employees - Tax Advantages - Competitive Advantages
3rd Strategy
Partially Self Funded Plans
Conclusion
Most small businesses where talent is key to their success should exit the community rated pool.
Retaining Employee Benefit Programs are an obvious choice for 75% of small business owners
Benefit Strategies
Funding
Private Exchange
Association Plans
Summarize your recommendation
Growing small businesses with moderately healthy, skilled employees must position themselves to take advantage of new funding options
Challenges and opportunities
Community Rating
Increased benefit costs
Lack of information with funding options
Reduced ability to help employees
Keeping healthy groups healthy
The Problem
Unmanaged Health Care Costs is a distraction for employees, consuming an ever-greater portion of individual income. Businesses lose control over their compensation strategies and face shrinking margins.


What success will bring...
Better Return on Investment with the same risk
Lower overhead/higher margins
Greater options for benefits.
Control
Productive, engaged employees.
Get your audience excited
Rather than accepting the community rated 30% - 100%+ increase, employers work towards Level Trend. The lower costs translate into more flexible benefit offerings or investments in core business strategies.
Potential Improvements
Employee Productivity - Chronic Conditions are avoided or if any, are managed
Eliminate or Reduce disability claims
Administration costs are reduced
Improved reporting
Profit margins increase, sales increase, Equity increases

How problems can be resolved
Implementation of BB&T Health Assessment/Program
Initial business strategy review at least 9 months in advance
Correlation between personal choices and personal finances

Pro
Elimination of benefit administration
Elimination of benefit cost
Con
Lose tax exempt benefits for employees and employers
Talent attraction and retention
Pay community rates
Employees may face economic and health related issues distracting to their role at the company
Pro
Escape community rates
Gain additional compliance services - ERISA wrap and Plan Document
Reduced administrative costs including commissions
Con
Must work within that particular industry
Group is experienced rated and rates could go up if poor claims year
Fully insured product - no upside potential of sharing in a good claims year

Pro
Defined contribution for easier budgeting
Single bill for easier administration
Employee choice to buy benefits that fit their needs
Multiple medical, dental, vision, etc. options
No participation requirements for ancillary coverage
No company size limit
Claims Reporting
Con
Fully Insured - no premium credit with good claim years
Pro
Experience Rated
Flexible Deductible limits
Cross State Lines
Segway to Self Funding for growing companies
Claims Reporting
Tailored benefits - no EHB
Lower administrative costs - line item bill
Con
Experience Rated
Longer term concept and strategy
Possible difference between Stop Loss Carrier and TPA
Review the pros and cons
Healthy, higher income groups should be Experience Rated
Average groups should consider a fully insured plan in the BB&T Private Exchanges
Explain how it will help
Competitive advantages don't last long in capital markets. Small businesses will have an advantage attracting talent and more time to focus on core business strategy, processes and operations.
Describe the next steps
Coordinate a meeting with BB&T Insurance to discuss your business profile and options. These strategies need time to evaluate and best reviewed without additional pressure to buy.
Based on Jim Harvey's speech structures
Full transcript