Become the Agents of Change

Pay a Bill

Redefine Your Business and Thrive in the Age of Healthcare Reform

Medical Carrier

Be Afraid….. Be VERY AfraidThey're coming for your commissions!

Don’t Be Frightened by Obamacare.Protect and increase your commissionswith new payment strategies that empower individuals

Small Businesses Dropping Coverage

Seasonal/Temporary Workers

Retirees

Spouses

Unions

Contractors and Consultants

Individuals

Indv. Declining Group Coverage

Part‐Timers

COBRA

Municipalities and Government Agencies

Source: 2013: Health Partners America. 

Leading Experts – Game Changer

Source: 2013: Health Partners America. 

Leading Experts – Game Changer

Source: 2013: Health Partners America. 

Leading Experts – Game Changer

Exchanges May Draw 37 Million Already‐Covered WorkersMillions of workers who are covered at work could instead choose insurance through state exchanges. How many millions? Roughly 37 million, according to Dr. Jay Bhattacharya of Stanford School of Medicine.

“The reason is that these workers would qualify for substantial subsidies to buy exchange insurance,”

In other words, the subsidized Obamacare premium will be less than what they pay for employer based insurance.

Leading Experts – Game Changer

Source: 2013: Health Partners America. 

Leading Experts – Game Changer

Source: 2013: Health Partners America. 

Leading Experts – Game Changer

Payroll Deduction Premium Persistency

55% of employees feel that payroll deductions for voluntary benefits help them to be more disciplined about saving. This discipline – coupled with the financial safety net the benefits provide, and an integrated education campaign – can translate into increased enrollment. MetLife Survey – 2013

Payroll deduction participation ranges between 25% and 45% for most products but on direct pay, the rates tend to be in the single digits. Eastbridge Consulting Group – June 2013

The Average American bounces 12.7 checks a year and which generates $9.4 billion in bank fees Compilation American Banker 2012

The Average Pa. checking account balance is $3,100. This would be depleted in less than one year.The Average savings account in Pa. is ONLY $6,100. Pitney Bowes 2012

Payroll Deduction

Persistency Drives

Participation

“Every check a policyholder/customer has to write provides him or her another opportunity to reconsider the purchase decision.”

Joint Study Sponsored by LIMRA International and Society of Actuaries

The Shift……..

What We Know:• The Affordable Care Act (ACA) is here to stay

• Employers are becoming more aware of the potential subsidies

• Employers are asking their brokers for help transitioning their employees to the exchange

• Brokers are concerned about lower commissions (rightfully so) and their ability to enroll and engage individuals

• Brokers need to be able to drive new revenue from new business and from existing cases

The Future?

Overall, 30 percent of employers will definitely or probably stop offering ESI in the years after 2014.

Among employers with a high awareness of reform, this proportion increases to more than 50 percent, and upward of 60 percent will pursue some alternative to traditional ESI.

At least 30 percent of employers would gain economically from dropping coverage even if they completely compensated employees for the change through other benefit offerings or higher salaries.

Contrary to what many employers assume, more than 85 percent of employees would remain at their jobs even if their employer stopped offering ESI, although about 60 percent would expect increased compensation.

McKinsey and Company – Private sector employer study

The Shift……cont.

What We Know Continued…….

• Employers and employees may no longer pre‐tax individual policies on the public exchange (No HRA’s or PRA’s)

• Once employers send employees to the exchange, they may wash their hands of all administration – no more billing and administration which limits revenue (VB) opportunities

• Medical Insurance is becoming a “voluntary” program

Follow The Money

The Subsidy Calculator

The ACA Calculator

Illustrative Sample of a 60-Life Group Commission

Opportunity

$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$18,450 $4,613 $30,245

Broker Income Outlook under Obamacare

Group Broker Commissions Current Group ClientGroup Broker Commissions as Employees Peel OffBroker Commissions Indiviudal Process Existing Client or Another Group's Broker Account You Take Over

Income drops to this lower point as you lose commissions because employees leave the group.

Your income when you convert the group to individual coverages and you remain as the broker. You can also sell additional voluntary products

Money the government contributes to the employee instead of the employer

Total the employee pays for SILVER (not Bronze) Family Coverage –$172/month

By the way, the Bronze Plan would be FREE for this family!

You’ve taken the Plunge – Now What?? Either your client asks you to enroll their employees on

the exchange

Or

You proactively approached your client with these financial solutions and sold them on your strategy

Congratulations!

Now oh god you actually have to sell the individuals and enroll it!!

HOW�DO�YOU�DO�THIS?

What Do You Have To

Make Decisions About?

1. Pick the ProductsWhat other products other than the individual medicalCritical Illness, Gap, Life, Pet, Dental, Telemedicine, ID Theft, Disability, Vision, name your product

2. CHOOSE THE CARRIERS? How do you pick between them?Medical, Voluntary/Worksite, Ancillary, etc.

3. How you are going to enroll, administer, and get paid?

What Do You Have To Actually Do

To Enroll The Case?

What About The Money?

How�are�employeesgoing�to�pay?

New Solutions for Carriers, Brokers, Enrollment Companies

Payment system solutions and banking platform that: Bills, collects, and remits payments from individuals directly to carriers

Provides Direct Access to sell employees even when an employer doesn’t offer, sponsor, or assist in providing supplemental benefits

This is not the current payroll deduction process or any existing bill consolidation approach!

Financial Wellness Strategies

Current Employer ChallengesNew Payment Solutions

Current Challenges / Headaches Peace of Mind Solution with Premium Payment Aggregator Solutions

Premium reconciliation, escrow balance recordkeeping and balance sheet headaches No More Reconciliations

E.R.I.S.A. Plan Liabilities Same benefits transforms ERISA plans to non-ERISA plans NO ERISA LIABILITY!

Lose productivity because one third of my employees are dealing with financial issues

Provides employees with budgeting tools and visibility to manage their payments and finances

Administrative tasks with helping employees with 401(k) hardship loans – currently 40% of employees request loan withdraws

This can be reduced when employees budget their money correctly.

HIPAA – Privacy Laws YOU KNOW WHAT EMPLOYEES PURCHASE – SHOULD YOU?

Similar to PayPal™, their purchases can be shielded from the employer.

Employer Access Strategy in the New World?As Employees Turn Consumer

without Payroll Deduction Plans…

Fact – Traditional group insurance and ESI are on the decline

Question – How are you going to deal with this?

Answer – Provide group-like coverage to individualso Engage Voluntary!o Maintain the same accesso Maintain the same retention when they don’t have payroll deduction

How? Engage a Premium Payment Aggregator (PPA)o Exchange Payment Methodso Voluntary Marketplace Place payment methods

Keys To Success

Follow the Money

Engage Voluntary to enroll your new individuals

Find new prospects and replace their broker

Sell More to Existing Cases

Help make practical the transition from group to individual

Help maintain renewals of the individual product sales