We’re going to take care of this: A Q&A with Alex Dampf
Alex Dampf, president of Oakmont Benefits Group, believes in constant communication and collaboration with his peers.
Alex Dampf is president of Oakmont Benefits Group, where he helps businesses transition wasted benefits dollars into working capital to grow their business and maximize profitability.
Paul Wilson: How did you get your start in the benefits industry?
I have a degree in finance and economics, but I graduated from college in 2010, which was not a great time to look for a job in that field. My mom worked for a broker and is now the director of HR for a large company, so I was pretty familiar with those industries.
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While in college, I had done an internship for a guy who did some work in the benefits world with his wife, so when I was looking for a job, I knew some people in the industry and ended up at a small, family-owned firm in Nashville, where I worked for almost nine years.
PW: How has your background shaped your mindset and the way you do your job today?
I think my background helped me not have health care blinders. I remember very early in my career asking, “Why can’t every group be self-funded? Why does size matter?” No matter who I asked, I’d hear: “The claims are the claims. You can’t really do anything about it. You have to find the groups that aren’t sick.” At the time, I didn’t have the knowledge to push back. When you hear it over and over from people who have been doing this for a long time, it’s like “I guess that’s just the way it is.”
After a while, I started to think, “Well, maybe we can do it a different way.” So I started trying different things and finding groups that would be a guinea pig in different situations. It was becoming evident that we couldn’t keep doing things the same way. I had a gut feeling that there had to be people out there doing it in different ways, so I started searching for phrases like “how to make health insurance costs go down.” That led to a lot of weird rabbit trails, but I would find articles and read them and then just reach out to the people in the articles.
When I reached out to people across the country, I can’t remember a single one telling me, “No, I’m not going to tell you what I’m doing.” Most people were very gracious with their time for a guy who was just calling out of the blue. They would explain what they were doing and some of the details behind the article or case study they were involved with. And then they’d often connect me to two or three other people. It honestly kind of blew my mind.
PW: How has the pandemic affected your business and your life? How are you adapting?
When I started my business, I knew I was going to have to leverage technology pretty heavily. In some ways, COVID actually made things a little easier. We had technology already in place, so we were set up and ready to go. We’d invested in technology to manage so many of these processes, so it became a differentiator.
PW: Can you talk about competing as a small shop? What are the challenges and advantages?
At my prior agency, I had always been a part of the conversations around vetting new technologies and partners. They’d say, “If you want all this technology, you need to do the vetting and show us why we should have it.” So I had gone through the process many times. I have great relationships with a small group of advisors through Health Rosetta, and we have a group chat and Slack channels where we’re constantly communicating. I have no problem taking advice from people who have done it before. So a lot of it is relying on people I respect and using the knowledge I gained in the past.
PW: How have you adapted your communication and enrollment strategies in recent months?
We’ve had to adjust to try to stay in touch with them and keep them abreast of a lot of the one-off regulatory changes that are hard to keep track of. I spent a good month during the early stages of COVID trying to make sure that the processes we had in place all made sense, so we knew what we’d do in certain situations.
We’ve written business throughout the pandemic, so I knew that the fourth quarter was coming and we needed to be ready. It’s just been making sure we follow what we put in place six months ago.
Like everyone else, we’ve been doing a lot of Zoom meetings, but we’ve also been making educational videos for clients that employees can watch. We’ve been recording voiceover PowerPoints to replicate a normal open enrollment meeting where someone can watch it without us there. We’ve done focus groups with clients to try to figure out which things we need to better communicate. We’ve even started doing meetings with managers of frontline workers, because so many employees come first to their managers with a question or they overhear questions or concerns while they’re on the floor. We’ve had to retrain them on things they can do to help employees.
Most employees don’t use insurance very often. When they hear about unbundling or reference-based pricing, it’s a whole new world. To expect employees to remember what you told them eight months ago during a 30-minute conversation that they didn’t want to have in the first place is always a challenge.
PW: Are you starting to see more employers that are open to innovative ideas and strategies? What about the employees?
In a lot of these blue-collar industries, you typically have lower-paid employees who are often living paycheck to paycheck. And the benefits just aren’t that great; they’ve really eroded over the past decade. When we show up for most of our clients or engage with a new company, we’re often looking at $5,000 and $6,000 deductibles, they’re butting up against the ACA limits on how much employees can pay, and there’s nowhere for them to turn. When they don’t have anywhere to go, they’re more open to listen to alternative ideas.
When you can’t make employees pay any more, can’t raise their deductibles any higher and you’re looking at a 20% increase, you have to find somewhere to go. We try to be very strategic. At the beginning of my career, I thought, “Let’s go as fast as we can,” so we’d go in and just blow it up. But I’ve learned that it’s much easier and far more beneficial for everyone if we’re strategic.
In our area, there’s still a lot of fully insured business, even in the mid-market space, so a lot of it is explaining how self-funding works and transitioning them to that model or getting them comfortable with it. You can slowly work with them over two or three years to get where we can have options and can pull more levers.
PW: In which areas and strategies are you seeing the most success?
The area we usually approach first is pharmacy, because there’s just so much fat. Often, you can make small tweaks, employees never see any change or disruption, and you can make some pretty significant impacts.
When we’re looking to move a group to self-funded, independent TPAs and independent PBMs are the two cornerstones we address in year one. The other areas we focus on are steering members and building dynamic health plans where if you visit a high-quality provider or go to an ambulatory surgery center versus an in-patient facility, we can design the plan so you get to benefit as well as the employer. In many cases, it’s free for employees and we completely waive their out-of-pocket cost-sharing.
PW: Key in all this is transparency and data. How is that going?
Employers are starting to demand more from carriers and expecting to see more data points, even if they’re fully insured. I’m amazed by the things that many groups have never seen before.
So we’re seeing some momentum there, and I think the market is starting to react. The carriers still don’t share a lot, but we’re seeing more and more that are sharing data.
The first step in our world is moving from fully insured, where we don’t have a lot of data. Maybe it’s a carrier-owned level-funded program where at least we can get some data to see what’s going on. And then we can take that data to the reinsurance market and see what options are out there. I think more groups are open to that type of approach.
Early in my career, there were lots of groups that were adamant that they’d never do self-funding because they had been told they weren’t large enough or they had had a poor experience with it. But I think with the technology and analytics today, it’s really advantageous for an employer, once they see that data, to treat it like they would anything else in their business.
PW: What are the hardest/most rewarding parts of being an innovator?
Employees tend to be inherently skeptical of the things that are being told to them by our industry. Earlier in my career, we were speaking at a manufacturer where the employees were paid minimum wage and we were going through the normal talk about HSAs and tax advantages. I was in the conference room with 50 employees, the room was set up in an O, and I was right in the middle.
A guy interrupted me and said, “None of that matters to us. Every month, I’m deciding which bills to pay and when to pay them. All I heard you say was my premiums are up compared to the last three or four years, my deductible is higher than it’s ever been and now I don’t have copays to get medication filled and for my kid to go to the doctor.” That was the moment in my career where I was like, “I can’t do this anymore. I can’t have these same conversations with people.”
On the other hand, I remember a client that had an employee who took a medication that was $250,000 a year. It sustained his life, but every year, he’d hit his out of pocket as soon as he went and filled his medication. This was a small group, so that one medication was equal to 80% of the premium they paid. We figured out a way to get that medication for free for the plan and for him.
Those are the ones we all like to talk about and they’re great for case studies, but my dad’s a diabetic, so when people can’t afford their insulin, I know how much that means. Those are the things that get me excited; when someone has been skipping dosages or splitting pills and you can tell them, “You don’t have to do that anymore; we’re going to take care of this.”
PW: How do you stay motivated to fix things?
It’s hard sometimes not to get overwhelmed. Having a group of friends who are all insurance nerds like me helps. We chat every day and I’m sure sometimes, our wives are thinking “Who do they keep texting?” That keeps me going along with knowing that the system is so big and individuals are so small. The system will just run you over.
I have a guy right now who’s in the middle of cancer treatments. He met his out-of-pocket January 2 and the hospital sent him a bill for more than his out-of-pocket. He paid it, and then they took 60 days to process his payment and file the claim with the insurance company. Then, he got all the other bills, so he’s getting collection notices from these other entities because the claim hasn’t been processed yet. It took most of the year to get his money back from the hospital. He’d call and say, “I have a stack of 20 bills and I know I don’t owe them, but I can’t find claims or EOBs that show they’ve been processed. I don’t know what to do.”
I get why people just give up. Imagine having to fight with someone for eight months for two or three thousand dollars when you’re living paycheck to paycheck. You bear all the burden to prove you don’t owe that. It’s really hard.
PW: How can the industry do a better job of innovating, adapting and bringing in younger and more diverse talent?
I think we need to look to outside industries. Look what happened with Zenefits and their technology. Regardless of their faults and some of the things they did, some of the ideas and processes they built were game-changing. I think as more and more innovation comes in and more people see the opportunities that exist for improvement, it will help. The industry is ripe for disruption.
When my peers and I discuss ways to expand our businesses, we talk about finding people from outside the industry. If they have no preconceived notions, it’s pretty simple. Unlearning and untraining is the hard part.
PW: Finish this sentence: The key to success in this industry going forward is…
Sincerity. If everyone’s agenda was to do what’s right for the end-users and their families, we’d all make enough money, we’d all be successful and things would be a lot better.
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