Due to rapidly rising costs, benefits brokers are more important than ever. So how can CFOs be sure they have the right broker for their unique needs?
Like anything in the Finance world, it all comes down to doing some research on your company’s specific needs and checking to make sure the broker you select has the tools to take care of those things.
Whether you’re reviewing your current broker’s performance or looking to enlist the services of a new one, here’s a checklist on what your company deserves to receive from a benefits broker:
Does the broker have solid references? Obviously, you want a broker with some industry experience. And that experience should translate directly into lots of strong references from satisfied customers. When asked, reliable benefits brokers should have no trouble providing an array of references from similar businesses in your industry and local area.
Does the broker have a comprehensive understanding of all plan designs? When it comes to health insurance, there are plenty of options for employers to choose from. And a skilled broker should have expert knowledge of all of them. From traditional plans to CDHPs to various self-funding options and everything in between, your broker should be able to tell you the pros and cons of all of these plan options for your company. You’ll also want to find out what methods the broker uses when recommending benefits options.
In addition to general plan design info, brokers should have a wealth of info on all of the health care carriers in your area, as well as apples-to-apples comparisons of their different price points and answer questions like: What are the differences between the costs and plan designs among the major carriers in our area?
Is there a good variety of different plan choices? On top of standard health-care coverage, a benefits broker should be able to assist you with an array of benefits options like life insurance, dental and vision coverage, long-term disability and wellness options, among others.
Can the broker answer questions about federal and state regs? In the end, employers are on the hook for noncompliance with federal and state regulations. But that doesn’t mean your broker can’t provide you with guidance in this area. So when meeting with a potential broker, prepare a list compliance questions to gauge his or her expertise on federal and state regs.
Can the broker provide practical, real-world info on Obamacare’s impact on your workforce? This is a big one. These days, any reliable benefits broker should be able to go beyond just explaining what’s included in the Affordable Care Act. Your broker should be able to tell you how each major provision is likely to impact your company, with real-life examples you can pass along to employees and upper management.
Level of commitment
Once you’ve determined that the broker has a handle on all of the basics, you’ll want to make sure he or she is the right fit for your company. To that end, you’ll want to get answers to the following questions:
How dedicated will the broker be to your company’s specific needs? Benefits brokers should always be willing to put in the time that’s necessary to understand the specific needs of a company, so it’s important to ask what he or she is willing to do for your company.
This usually entails a broker looking at job descriptions, income levels, languages spoken and other employee demographics when it comes to determining the best benefits options for your company. You’ll also want to find out what strategies the broker has in place to determine your company’s top health risks, as well as tactics to limit your exposure to those risks?
Is the broker willing to participate? If your HR or benefits department handles the brunt of the benefits administration you may only want a broker who comes in for annual open enrollment — or even someone who can offer advice and suggestions remotely.
However, some firms prefer a broker who takes part in regular (quarterly or monthly) education sessions and handles data-management processes, so early on you’ll want to find out how willing a broker is to participate and take on various tasks.
How often does the broker check-in/what are his or her preferred communication methods? It doesn’t matter how qualified a broker is, if he or she can’t put in the time your firm requires, the relationship just isn’t going to work. So you’ll really want to do their homework here. Find out what the broker’s preferred communication method is, as well as how often (weekly, monthly, etc.) he or she normally checks in with clients.
What type of cost-sharing and administrative help does the broker provide? Reliable brokers should be willing to help share in some of the cost of companies’ employee-education efforts and be willing to assist in claim administration efforts.