This is a marathon: A Q&A with Erica Kasperkowiak
The senior vice president, private equity human capital risk at CAC Specialty says her clients aren't that different from other industries.
Erica Kasperkowiak is senior vice president, private equity human capital risk at CAC Specialty, where she specializes in advising private equity clients and ensuring they are aware of the holistic picture of insurable and non-insurable risk in their portfolios.
How did you get your start in the benefits industry/?
I started my career in HR and operations, where I was working full-time while pursuing a Finance degree. I’ve always been financially inclined, and the marriage of that with the people side of things is what always appealed to me about benefits consulting.
I was living in Connecticut, and after graduation, I wanted to move to a city and said “I’ll take the first job I get.” It happened to be in New York, which was terrifying. I was wondering, “Can I really do this? How will I survive?”
Within weeks of moving to NYC, the financial crisis happened. I was working for an insurance brokerage firm, so the panic was very evident. It was a very interesting time to enter the industry, but it was also an amazing opportunity. I ended up being part of a merger of multiple organizations that focused on private equity, so I have been a benefit consultant specializing in private equity from the very beginning of my career.
I almost left the industry at one point because I felt like all we were doing was delivering bad news. There were no real fixes for a very obvious problem: Costs kept going up, benefits were eroding, and I felt like there was nothing I could do. If I wasn’t going to be able to fix things and help people, then I didn’t want to be a part of it. So I did briefly leave, going into management consulting and more operational work in the HR consulting space. I tried to distance myself from benefits because I was worried it was a sinking ship. Health care reform had just passed and I was thinking, “I still have a lot of years left in my career; is this going to continue to be viable or not?”
My career took a little bit of a turn and I was blessed to have a son, so I took a year off. During that year, I gave a lot of thought to what I wanted to do with my career.
I came back to the benefits space after discovering that I wasn’t alone in some of my concerns; there were other people who also wanted to do better. I discovered the Health Rosetta organization and realized there were at least 100 other people out there who felt the way I did. As I started networking and connecting with many of those consultants across the country, I felt inspired to be part of the fix.
So now, I lead the private equity human capital risk practice, which is the benefits practice at CAC. We’re a specialty insurance brokerage and risk management advisory firm working toward fixing the broken employee benefits paradigm through transparency, authenticity, integrity and with the help of private equity, which I think typically gets a bad rap.
Private equity is very fast-paced, very logical and despite the reputation, they actually do want to help employees so the companies will grow. So it can be a faster way to create the fix that I’ve dreamed of being a part of.
Have you seen conversations with HR and the C-Suite evolve? How have those relationships changed?
I don’t think we’re having any conversations alone with HR anymore. HR has really transformed; 15 or 20 years ago, it was viewed as more of an administrative position, whereas now it is truly a strategic position. Our head of HR is probably the best HR person I’ve ever known; she is very well respected here and is a key part of every single conversation. That’s truly a beautiful thing to see, because there is just so much more credibility and they are more valued by organizations and finally viewed as a true partner. We’re seeing that with our clients, too, which is something I love.
As consultants, we talk with the CFO and HR, and the CEO is increasingly a part of those conversations, as well. There are a lot of different dynamics at play and we have a very challenging talent dynamic right now with the Great Resignation. We are dealing with economic uncertainty as well, so how do we manage finances and keep talent? It’s an interesting balance. We don’t come in consulting on benefits only. My background helps me have conversations that are more holistic. “What do you want to achieve? Let’s craft a holistic solution around that.” It could involve benefits, but it might not and that’s OK. That’s why we call it the human capital risk practice, because we’re coming in to help solve problems, no matter what they are, and to help optimize and achieve any strategic goals that our clients have.
What are the unique challenges and opportunities in working with these types of employers in your part of the country?
We work with clients across the country; it’s driven by where private equity is investing, so there are really no boundaries. There are also no limits on the client size or the industries we serve. We’re helping small, mid-sized and large employers. They all have their own challenges, but what’s interesting is that the solutions have come down market, which is great. Maybe 10 years ago, you would have to tell a smaller employer that there wasn’t a good solution for them, whereas now, we’re able to be more creative.
I still think there needs to be more done to help the smaller employers, though. We’re a country of many entrepreneurs and we often get to work with founder-led companies that grew something from nothing. Maybe benefits weren’t a very big spend or focus when they started with a handful of people, but as they transform and grow, it eventually becomes a pain point for all of them. The fun part is finding a solution and mitigating before it actually becomes a pain point.
What are some of the areas you’re watching when it comes to issues around innovation, cost and quality?
We are very focused on education. There’s an entire spectrum of solutions out there, all the way from fully insured to self-funding where we can break apart all the pieces and look at options like reference-based pricing. It’s a big transformation to go through; first you have to educate them about the problems, because not every stakeholder or client understands.
We all personally feel that benefits don’t feel like a benefit anymore, but I think it’s clouded a little bit by the business side of it. We have to offer benefits to our employees, but we’ve been desensitized to the whole thing over the years. The first step is educating clients about the problem and then letting them know that there is an entire spectrum of solutions. With some clients, it can take years to get them to a place where we’re starting to makes big changes and solve for the broken paradigm that exists.
We very much advocate self-funding; once you get them there, there’s a whole slew of things you can do. We try to go from easiest to hardest, based on our clients’ tolerance and what they’re trying to achieve.
How do you help guide them from where they are currently to where they need and want to be?
It’s kind of funny, because I equate it to being a parent. You know what they need to do, but sometimes you can’t tell them. They need to figure it out for themselves. It’s definitely a gentle approach that requires educating them about where things stand and then you can watch the transformation happening over time.
We have one client that was previously with a PEO, so they were accustomed to that model. We eventually took them into self-funding but we started by telling them, “Some people go all the way into RBP” and we started educating them about how that works. And at first, they were like, “That’s so much change; we would never do that.” But fast forward to a year later and they now understand more because they’re self-funded; they have more information, more knowledge–and knowledge is power. So now they’re starting to connect all the dots. It’s funny, because now you see them driving change, when a year ago they didn’t think they’d ever do something like this.
I think the client has to want to do it in order for it to be successful and that takes time.
How are those conversations about change and innovation going right now with clients and prospects? Are you getting more buy-in?
It really depends on the individual client’s personality, risk tolerance and preferences. I would say that there is definitely a move toward incorporating more technology into health plans. We’re seeing a lot more virtual care, because fully remote workforces have opened people’s eyes to think, “OK, if that works, then we can do remote health care, too.” Not every client believes that it would be a good fit for their employees, but I do see a growing amount of acceptance in that area.
I like where the industry is going with the TPAs and innovative solutions that are coming out. It’s more about efficiency, cost and creating a better experience for the employee.
Can you talk about the growing impact of transparency and data?
I think that number one, it’s about advisor compensation. When we step in to help clients, we’re still seeing that they often don’t know how much their broker makes, despite the fact that it is now required. For my entire career, my clients have always known what we make. I’ve always believed that’s the right thing. It’s interesting to me that it’s taken so long to become accepted practice, but our clients often still don’t realize that’s something they should know. We lead with that; we believe our clients should know what we’re making and what we’re doing for them. We want to be valued as much as anyone else does for the work they do. I don’t think that should be hidden.
On the data front, I think we are still having to help clients realize that the more data they have, the more power they have. When they have that power, they can then do something with all this information they have to make it better, not only financially for the company, but also better for their employees. I wish it wasn’t so difficult to get data, especially for smaller employers.
Are you optimistic people in our industry can create change and fix this without government intervention?
I’m optimistic that our industry can change it on our own. Maybe this is me being overly optimistic, but I believe it will evolve because of the talent that will continue to join this industry. People want to be part of social change and do the right thing. Part of our mission is to inspire a younger and more diverse workforce to take an interest in being part of the solution.
Speaking of, how can the industry do a better job of attracting new talent, while becoming more diverse and bringing in young people to keep its momentum going?
Our strategy includes recruiting candidates who are fresh out of college. We’re having conversations about how to approach these kids who often don’t even pay for their own benefits yet. They often don’t know anything about the industry. This industry was historically painted as stale, but we now operate as consultants and problem solvers, so that’s a big difference. You can inspire talent to join the industry if you can give them an opportunity to be part of changing something.
What advice would you give to someone who’s new to the industry?
I would tell them to learn constantly and to seek out different perspectives. I would also suggest connecting with employers and trying to understand where they’re coming from. In our industry, we frequently push things onto clients instead of truly seeking to understand their perspective and the things they’re trying to achieve and then educating them from that perspective. It’s about being empathetic. At the end of the day, you can’t serve until you understand.
What is one thing you know now that you wish you’d known when you started your career?
That the system was broken. I feel some guilt about how I consulted at the beginning of my career. I still feel guilty about what my perspective was when I started. I wish I had known it was broken, because I would have told my clients.
How do you stay motivated and positive?
I just know it’s not a quick fix, so it’s about setting expectations with myself as much as it is for my team and my clients. This is a marathon.
What are your favorite things about your job?
I’m part of an organization that is trying to do the right thing. It’s inspiring to work for leaders who are creating a company that wants to do the right thing for our clients and their employees. That helps me inspire my own team.
And also just the passion I feel about trying to fix the broken employee benefits paradigm with our clients. Being part of the solution is what gets me up every morning.
Can you talk about the environment of collaboration you’re seeing these days in the advisor community?
I can’t say enough about the Health Rosetta community We serve clients across the country, so we can look at the map, find a fellow advisor and tap into local knowledge. To have a shared passion on the other end of the line is so comforting and helpful. I don’t think I’ve ever experienced any kind of pushback or negativity. There’s an understanding and very nice feeling of collaboration.
It’s great to brainstorm with others, both seasoned veterans and newer advisors, about what they’re seeing. Because it’s always changing and there are always new solutions and new companies out there.
How do you keep up with the pace of change without getting overwhelmed?
Sometimes it feels like you can’t keep pace and I try to have grace with myself about that. But natural curiosity helps; I have a passion for learning and realize I don’t know everything, so I’m a sponge for anything that is emerging in our space. We work with MZQ Consulting and I rely on them, Health Rosetta and my network, which has been very powerful in presenting their own experiences. And then there’s LinkedIn and so many other communities where you can absorb information. But it can definitely be daunting! It’s very complex and there are so many layers and solutions.
Finish this sentence: The key to success in this industry going forward is…
Integrity and a passion for solutions.
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