April 2   4 15pm - william short
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  • 1. + The Obamacare Opportunity Surviving & Thriving in a Post-ACA World William C. Short President & CEO, AmeriFlex Business Solutions
  • 2. + Agenda  The Affordable Care Act: A Brief Background  The Key Players & the Great Incentives Problem  Looking into the Crystal Ball: What Lies Ahead for Health Care?  The Opportunity  You are no longer a broker!  Build-a-plan exercise  Gateway questions every broker should be asking their clients  Q&A
  • 3. + The Affordable Care Act: A Brief Background  Signed into law March 23, 2010; represents most significant regulatory overhaul of U.S. healthcare system since Medicare/Medicaid of 1965  ACA goals: make health care more affordable, reduce uninsured, reduce costs for individuals and government  To achieve its goals, the ACA introduced a number of mechanisms, including mandates, subsidies, and insurance exchanges
  • 4. + The Affordable Care Act: A Brief Background The rising cost trend within the U.S. healthcare system was used as the political rationale for the ACA. But has the law addressed this issue?
  • 5. + The $64,000 $2 Trillion Question: Will the ACA address the problem of rising healthcare costs? Let’s start by asking: What drove costs up in the first place?
  • 6. + The Key Players and the Great Incentives Problem  Rising costs in health care are due to a fundamental misalignment of incentives between the “key players”: the Patient, the Provider, and the Insurance Company  Let’s look at each of these players a little more closely…
  • 7. + The Patient  Pays premiums each month  Service associated with co-pays and coinsurance  Insulated from true cost of care  What are costs/incentives for the patient?
  • 8. + Health Care and the All-You-Can-Eat Buffet
  • 9. + The Provider  Medicine not an exact science  Who is the “customer”?  Who pays the provider, and what is the cost of a provider getting “paid”?  Factors leading to hyper increase in costs since inception of managed care  What are costs/incentives for the provider?
  • 10. + The Insurance Company  What are health insurance companies? Or, more importantly, what are they not?  How do insurance companies make money?  Which brings us back to…  What are costs/incentives for the health insurance company?
  • 11. + The ACA “Fix”? Did the ACA fix the misalignment of incentives between the patient, the provider, and the insurance company?
  • 12. + Looking into the Crystal Ball: What Lies Ahead for Health Care?  The ACA will keep changing  Medicaid/Medicare for all  Deductibles for these plans will be BIG  Coverage will be bad  Network coverage will be bad  Long waits for providers that actually accept these plans  Looking to other countries and the Medicare supplement market in the U.S.  You can’t beat the market
  • 13. Who is depressed?..... But…Don’t give up yet!
  • 14. + To Attract and Retain  Prior to the ACA, why did employers offer benefits?  The opportunity is starting to present itself…  Employer and employee taxes going up  Deductibles and cost sharing increasing  Health spending accounts (FSA, HSA, HRA) looking better than ever  Don’t forget, indemnity and voluntary benefits exist outside of the ACA and can help “bridge the gap”
  • 15. +  The Scenarios:  Employer offers major medical plan that is ACA-compliant  High deductibles, unaffordable, poor network  Employer offers health spending account (FSA, HSA, HRA), voluntary benefits, wellness  The Outcome (Either Way):  Need for greater employee education = Opportunity  Reconciliation of premium collection = Opportunity  Need for a TPA = Opportunity  Individual worries about ability to pay for care, or desires higher standard of care = Opportunity
  • 16. The Goal is to take the Employer and their Employees from here… A non-complaint benefit plan that is too expensive for all parties …to here… A compliant and affordable benefit plan that delivers value required to attract and retain talent
  • 17. + Tailor the Benefit to the Individual  Using health spending accounts to save individual money on taxes  Educate individual on his/her benefit package  Present voluntary benefit product that is specific to his/her needs  Access to pre-tax (cheaper) funds and voluntary benefit products will help individual access the growing second-tier private market
  • 18. + The Power of Pre-Tax  Pre-tax dollars are cheaper than post-tax dollars  Health spending accounts are the vehicle to free up cash to pay for voluntary benefits
  • 19. + Additional Benefits to Employer  Offering employees numerous benefit plan options can quickly turn into an administrative nightmare for employers  Solutions:  Consolidated billing  Partnership with payroll provider that can manage all deductions at no additional cost  Partnership with TPA to reduce costs and maximize efficiencies
  • 20. + The Post-ACA Broker Consultant  Where brokers/agents become “consultants”  Enhanced brand  “Stickiness” factor  Block out competition from payroll vendors entering benefits space
  • 21. + Educate Yourself  Get to know the ACA  Huge law with more regulations being created every day  Opportunities “lurk” within the law and its regulations  Become a trusted source for your clients  Partner with organizations that can deliver information to your door  Get certified  ECFC (ecfc.org)
  • 22. + Build-a-Plan Exercise  Scenario One:  John: The 27-35 “Invincible”  In good health  Single  $45,000 take home pay  Major Medical Coverage is not affordable but offered by his employer  FSA plan is offered
  • 23. + Build-a-Plan Exercise  Scenario One:  While John thinks he is invincible, a strong case can be made that setting up an FSA to free up dollars to buy a critical illness policy is worthwhile  John can put $1,000 in his FSA and, by leveraging the power of pre- tax vs. post tax dollars, not only afford a $40,000 critical illness policy, but also have more available funds left over
  • 24. + Build-a-Plan Exercise  Scenario Two:  Susan: 30-45  Married  2 Kids under the age of 10  Family is healthy but has a lot of routine doctor visits and day care expenses  Husband also works but it is not offered health benefits through his employer  $55,000 base for Susan/ combined income $110,000 annual  Major Medical Plan is offered by Employer, in which she is enrolled, but the deductible is $10,000 for her family and she has access to an HSA with facilitated pretax contributions via payroll
  • 25. + Build-a-Plan Exercise  Scenario Two:  Susan is trying to figure out how to manage the below deductible exposure (or ‘cost sharing’)  She likes the idea of contributing pre-tax into an HSA and is considering a qualifying hospital rider
  • 26. + Build-a-Plan Exercise  Scenario Three:  Steve is a 60 year married man, income is $75,000, only he and his wife need coverage  His employer offers a $5,000 HDHP and is funding $2,500 into an HRA, but only after the first $2,500 has been spent  The HDHP pays 100% after the deductible Health Plan $2,500 HRA $2,500 Gap
  • 27. + Build-a-Plan Exercise  Scenario Three:  Steve is looking to find ways to mitigate the first $2,500 in exposure  Below is a possible solution:
  • 28. + Gateway Questions To Ask Clients & Prospects Now  How are you handling ACA compliance?  Do you have a POP on file?  How are you managing the growing ‘cost-sharing’ that is being placed on your employers?  What percentage of your employee base is hourly/part-time?  How are you ensuring they do not work more than 30 hours?  Are you offering any sort of benefits to help attract and retain the right talent?
  • 29. + Conclusion  What can history teach us?  Understand stakeholder incentives  Craft a strategy to help individual achieve success  Find your value proposition  Become a “total solutions expert”  Block out the competition and get your clients to “stick”  Become an ACA expert  Ask the right questions now to reframe your value, get ahead of your competition, and drive new business to your door
  • 30. Questions?