Where Do We Go From Here? Prospering in a Post-Health Care Reform World
Highlights
The convergence of the economic recovery and health care reform will dramatically reshape the benefits landscape, and require new navigational skills for those who depend on the industry to make their living. At the same time, the full implications and scope of health care reform are still evolving, making it extremely challenging for brokers and consultants — and the benefits industry itself — to prepare. Employee benefits brokers and consultants will be answering some defining questions about their role and how they demonstrate value to their clients in a post-health care reform era.
To help brokers and consultants as they re-examine their current strategies and explore new ones, MetLife conducted an extensive survey and face-to-face interviews with brokers and consultants who work with employers of all sizes. The results of this research reveal insights into the challenges and concerns brokers and consultants are facing, as well as the different strategies they are considering to sustain profitability and differentiate themselves in a post-health care reform world.
Although concerned about perceived hurdles ahead, brokers and consultants express confidence that they will find a variety of ways to prosper. In fact, brokers and consultants report that they are optimistic despite reporting low expectations for the growth potential of the benefits industry as a whole. Their optimism springs from their belief in the growth potential of their firm and its ability to be a winner in a tough environment.
As the market moves further from an employer-driven model, brokers and consultants have an opportunity to capitalize on this trend by placing greater emphasis on their consultative expertise in addition to plan design delivery. In parallel, the Patient Protection and Affordable Care Act’s (PPACA) minimum medical loss ratio-related provisions provides the motivation for significant changes to the commission-based compensation model for brokers.
In fact, interest in shifting from commission-based compensation to fee-based compenstiaon for medical insurance is considered a potential avenue to increase firm profitability for nearly a third of brokers.
Brokers and consultants have moved far beyond a “wait and see” attitude and are taking action. They are considering a wide variety of initiatives to help solve their clients’ evolving needs and, at the same time, increase the overall profitability and sustainability of their firms. While, for the most part, it’s clear that a new business model is a given, there is a wide range of strategies and tactics being evaluated in response to the perceived changes ahead.
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