Why Business Owners Should Not Ignore Their Employee Benefit Plans

don't ignore healthcare benefits advice

The other day I was having a discussion with a business owner.

OK, that’s not exactly unusual in my line of work. Blue Ocean Benefits & Consulting has more than 250 businesses as clients, so barely a day goes by when I’m not talking with either existing clients, or future ones. It’s fair to assume I spend more than a little time across the table from decision makers as part of my working day.

On this occasion, however, things were a little different. This time, I was the customer.

I was talking to a building contractor. After recently moving home, my wife and I were looking to have some building work done. After selecting the contractor, we arranged for him to visit to explain the work we wanted him to do.

After having introduced ourselves, it wasn’t long before the contractor asked me what I did for a living. When I told him our company provides employee healthcare benefits for businesses his response – unfortunately – was the sort of answer I tend to see over and over again.

The business owner sorta rolled his eyes. “I hate dealing with our benefits,” he said. “I let someone else handle that. I just can’t stand it.”

After reading the above, I’m guessing you are not that surprised. You probably agree with him.

You probably hate shopping around for health and dental insurance, too. And if you do it for your employer or business, you know how confusing, expensive and time-consuming can be.

You Don’t Know What You Don’t Know

But the reason the contractor’s response struck me differently this time is that I have recently spent a lot of time with our Sales Development Team. Just as with any organization, every so often we all get together to share intel and feedback on prospecting, engaging and finding new clients – as well as to learn about any particular problems or difficulties they’re facing. It turns out that one of the biggest frustrations the team have today is finding prospects willing to talk.

These days, more and more people just don’t answer the phone if they don’t recognize the caller ID. And if they do, they say something like “We’re good there,” or “We’re all set.” “We have used the same broker for years.” And my favorite one, “We don’t talk to ‘sales people.”

Right after that, they often hang up the phone as fast as they can.

Now I know every business gets a lot of sales calls, so I can’t really blame them. But one thing I know for sure is that, contrary to what they may think, many of them are NOT “all set.” After 25 years in this industry I can take a look at a list of the prospects that give that excuse and can confidently predict that at least 40% of those businesses don’t even know what healthcare plan they have. Many of them probably haven’t actually SEEN a proposal in years.

They have been told by their agent “There is nothing else out there,” or “We’re all in the same boat.” OR they have seen one or two options from each carrier. But they haven’t dug deeper than the superficialities and actually been shown the goods. And many of them have not seriously considered (or been advised) on alternative strategies such as alternative funding or HRAs, that may offer increased benefit options, lower costs – or even a combination of the two!

So why is this? There are many reasons, but one is because many agents are what my friend calls “towel-snappers.”

Towel-snapping, a practice witnessed up and down the country in a thousand locker rooms, is when someone takes a towel – sometimes a wet one – and “snaps” it at your leg or arm or ‘back door’, like a bullwhip. If done correctly it makes a loud noise – and it hurts. It is all in the name of fun and is what happens with friends are goofing around. Maybe you did it as a kid. If you don’t know what I am talking about take a look here.

We use this analogy because we imagine many agents or brokers to be that way.

They are fun people. They’re easy to talk to – it’s their job, after all. Many have a joke or funny story to tell you. Sorta like a towel snapper in the country club locker room. Hahahaha. Did you hear the one about…

Trusting Your Broker

Busy business owners don’t want to spend an hour or two going over something they hate and often don’t understand (hmm, maybe those two things are related?). And if the person who handles this is a seen as being “good guy or gal,” it is easy to have a little small talk, ask the agent what his or her advice is and move on.

In other words, people trust their agent or broker. They trust them so implicitly that they often don’t take the time to actually understand the offerings presented to them. And since they like their agent AND hate the subject matter, they don’t want to talk to other agents who (they assume) will likely tell them the same thing their agent told them.

The problem, in my experience, is that it just doesn’t work that way.

If you own a business with more than a couple of employees, the odds are very good that you’re certainly smart enough to understand things like medical insurance deductibles, maximums, copays, and the rest. Don’t leave the decision about “what is right” for your firm to an outsider. No matter how much you may like that person.

The sheer cost of providing employee benefits means you have a duty to your business to give this subject MORE time than other items, such as photocopiers or car leases. I know you would rather talk about getting leather upholstery for your next SUV. But from a business perspective benefits can be a huge number, impacting the lives of your employees at a far more fundamental level. Whether you make that number “just another business expense” or an investment in your people is up to you.

Asking for the opinion of someone else is almost never a waste of time, even if you end up going with your current broker. At least you’ll know he or she withstood the scrutiny, which may make you like them even more.
Employees take their benefits seriously, and learning all the ways you can get more for your money in regards to employee satisfaction and peace of mind might be worth much more than the time you spend reviewing alternatives.

Lastly, allowing another vendor to review your plan will, at MINIMUM, keep your current vendor on their toes and force them to use a very sharp pencil.

So next time you friendly broker or agent offers you an increase from your medical carrier and you are tempted to just raise the deductible or pass the entire increase on to your employees, give a thorough market check a solid thought.

If you call us, we guarantee the time you spend will be worth your while. And we promise not to bring any towels.


For a no-obligation consultation on the benefits strategy options for your organization, get in touch with us at info@blueoceannj.com
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