One of the largest expenditures a business owner is going to make is the premium they pay towards the medical plan in their company. That is of course assuming that the business owner has a company sponsored medical plan.
There are few owners who understand what the options are and where to find good brokers. A good broker helps the business owner make informed decisions about their medical plan. Having a good referral source for a quality medical insurance broker can improve your value to your business owner clients.
Understand what the general options are. There are three general forms of medical plans.
- A fully insured plan. This is where individuals will typically have co-pays and the insurance company picks up the lions share of any serious medical problems. I believe this plan is best for companies that have higher turnover rates and the owner doesn’t want to work very hard at explaining their medical program.
- An insurance plan with a health savings account. These plans have a high deductible attached to them. Participants in the plan have the option to put money in a tax-deductible account (similar to an IRA) that can be used for payment of the deductible or used for retirement or medical costs in the future. I believe this plan is best for companies that have a stable workforce and owners who are willing to work a little to explain how this plan works.
- A partially self-funded plan. This plan typically has a company deductible of $50,000 or more. The cost of the insurance is greatly decreased because of the large upfront deductible. This plan can be presented as a fully insured plan or a health savings plan. This plan should only be used if you have at least 100 employees.
Find a partner who is an expert at medical plans. I find that many health insurance advisors are well versed in one or two of the options. Finding an advisor who understands the entire waterfront of medical options is an important resource for you to have. In addition, this advisor should be well versed on the changing landscape of laws for medical plans and companies that provide them.
You want to make sure your medical insurance partner understands how to work in a collaborative manner with both you and your business owner client. It’s important that your medical insurance specialists understands what the owner’s goals are and doesn’t confuse everyone with too many options.
Medical insurance is often a disliked part of running a business. It’s expensive, confusing, and not well appreciated. You can help your clients identify good suppliers by spending time yourself on learning who are a good suppliers as well as good educators. You want them to be able to educate both you and your client well.
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