Obamacare: What is the future for brokers?Article added by Philip Eide on April 30, 2013
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Philip Eide

Shaker Heights, OH

Joined: December 12, 2010

These business strategies should be in place by October 1, 2013. It's do or die time now.

With health insurance changing the employer-sponsored models under PPACA/Obamacare, what tools can brokers offer employers to help them compete for and retain talented employees while making a living as in years past?

With PPACA due to fully engage by January 1, 2014, brokers who earn their living primarily from the commissions generated from health coverage are facing a steep decline in income. It is more than time for brokers to re-gear their skill set so that they will continue to be a trusted advisor to their current employer base, attract new clients and earn a living more commensurate or better than in previous years.

Employers, employees and individuals have been inundated with media about PPACA/Obamacare. Much of what they have heard or read has been politically motivated, but with little substance. Brokers will gain market share by providing all parties in the benefits decision-making process with valuable information based on facts, not proposals. As the timelines for PPACA kick in, the broker's input will become more and more valued. It's time to reach out as a professional to provide sound advice. Where to start?

A. Shift your income generation tools.
  • Fee for service: Brokers need to advise current clients and prospects that they will help sort through the most effective employer choices under PPACA, company by company. This consulting requires your time for needs assessment, research, analysis, reports and presentation which are no longer covered by medical insurance commissions.
  • Commissions: There may be gaps in coverage given an employer's choices under PPACA. To help employees structure their own portfolio of risk protection requires brokers to assemble a menu of voluntary/ancillary benefits that pay commissions.
B. Research and offer employers tools to help attract and retain employee talent. Look for tools that promote employee motivation, communication, wellness programs, appreciation and loyalty.

C. Integrate your marketing strategies.
  • Outbound marketing: Referrals, centers of influence, cold calling, mailers, etc. may represent current marketing efforts for brokers. How many of these have a traceable ROI? It's time for brokers to add a new marketing skill set.
  • Inbound marketing: A well-designed Internet inbound marketing campaign delivers self-qualified target market prospects to the door of brokers. Prospects ask for your program, product or service. Does it get better than that?
D. Develop strategies and benefit designs for clients that are integrated and provide flexible choices.
  • Private exchange (marketplace): Brokers assist employers in offering a platform for offering core, voluntary and ancillary plan choices to employees.
  • Defined contribution: Brokers help their employer clients determine a fixed benefit dollar/credit amount available to all employees within a classification without discrimination.
  • Menu of benefits: Brokers work with the employer and employees to determine the best kinds of voluntary/ancillary coverage to offer in the menu.
  • Enrollment: Brokers ascertain the best way to educate, communicate and enroll the menu of benefits within each client's culture.
  • Technology: Brokers offer an enrollment and data management solution to each client that is flexible and user-friendly to best meet each client's needs.
The time to get started is now. These business strategies should be in place by October 1, 2013 — this year, when the state and federal exchanges will be operational (for individuals and small groups). This will be in preparation for a January 1, 2014 effective date. If you are not ready, your competitors may swoop in to solve your clients' challenges in your place. It's do or die time now. Are you going to step up and play the game?
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