As the benefits industry looks ahead to the coming year, the biggest question is – yet again – what’s in store for the Affordable Care Act?
With the individual mandate repealed through the Tax Cuts and Jobs Act, effective 2019, the benefits industry could go in two different directions. Is the ACA here to stay, or are other regulatory rollbacks right around the corner?
Though health care was a major conversation throughout 2017, arguably, there was little appetite to dramatically change the employer segment, which insures more than half of the U.S. population. Most of the political focus was, and remains, on the law’s provisions affecting individuals.
From this, we can predict that while health care has lately been an “anything-can-happen” environment, it’s safe to assume there will be little in the way of change for employers in 2018.
This is not a bad thing for brokers. In fact, despite its challenges, the ACA has created some big opportunities for this industry, especially for brokers working with small and mid-sized employers.
The opportunity to go strategic
The ACA has allowed brokers to differentiate themselves on their strategic capabilities. While brokers were certainly executing for small groups prior to the ACA, it was arguably a simpler time. This created a status quo in benefits that still affects our clients today.
Here’s an example to illustrate what I mean. Here in Tennessee, employers with five or more employees are required to have workers’ compensation insurance. As you can expect, the process for brokers insuring these small groups of five, six, even 10 employees is fairly standardized. There just aren’t that many differences in the premiums or plan designs.
This is how it used to be for brokers providing small group health insurance. A basic health plan for 10 employees was bound to follow the same script.
Now, there is so much more to think about. The ever-changing regulatory environment means that the right strategy for a particular group can change year after year. It takes a fast-moving broker to keep up, but this is an exciting time to help employers find options that work for their employees.
At the agency that BerniePortal came out of, there is an employer who used to offer coverage to her small group, later dropped it because of big premium increases, and is now interested in revisiting group coverage for her employees. She has plenty of questions about her options, and there are multiple strategies available for her to find the best plan design for her team.
This is where today’s brokers can make the biggest difference in their clients’ organizations. With the rise of self-insurance for small groups and reference-based pricing, brokers can also help lead the industry toward a more cost-effective, rational framework.
The ACA has been a painful transition, but as long as employer coverage remains the bedrock of U.S. health insurance, it isn’t likely to see too many more dramatic changes in the coming years. This creates a clear opportunity for brokers to stand out from the competition by staying ahead of the curve and developing modern, individualized strategies for each of their clients.
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