Is "ACA Compliance Test" Good Door-opener for Collapsing Groups?

[JustAMarketer]

Hey, guys

Relative newbie here. As a marketer I want to focus on the niche of
collapsing groups and setting businesses up with ACA and ancillary
plans using a TPA. There's a lot of work involved for an agent but
it can be pretty rich.

Have been doing leads generation for over 20 years in different
verticals. I want to build a lead gen system for this "collapsing groups"
niche and be able to set appointments for our agents who are engaged
in this side of ACA.

My question is: Do you think using a software based "ACA Compliance
Test" is a good enough opener? Benefit Next offers a pretty cool
full compliance audit for ACA, DOL, ERISA, etc.

Do you think businesses would be willing to pay for this audit?

Apparently in tests the software has yet to find 1 business that is
fully compliant.

Do you think the audit is a strong enough hook to open the door
to collapsing exiting group ins, creating a SEP event and coming
in and replacing with ind. ACA plans and ancillaries?

Contemplating calling the system "Insurance Review Specialists"
or IRS for short

Thanks in advance, and I plan to contribute ideas in turn

 

[mkd1204]

Hey, guys

Relative newbie here. As a marketer I want to focus on the niche of
collapsing groups and setting businesses up with ACA and ancillary
plans using a TPA. There's a lot of work involved for an agent but
it can be pretty rich.

Have been doing leads generation for over 20 years in different
verticals. I want to build a lead gen system for this "collapsing groups"
niche and be able to set appointments for our agents who are engaged
in this side of ACA.

My question is: Do you think using a software based "ACA Compliance
Test" is a good enough opener? Benefit Next offers a pretty cool
full compliance audit for ACA, DOL, ERISA, etc.

Do you think businesses would be willing to pay for this audit?

Apparently in tests the software has yet to find 1 business that is
fully compliant.

Do you think the audit is a strong enough hook to open the door
to collapsing exiting group ins, creating a SEP event and coming
in and replacing with ind. ACA plans and ancillaries?

Contemplating calling the system "Insurance Review Specialists"
or IRS for short

Thanks in advance, and I plan to contribute ideas in turn

What do you mean by collapsing groups?? Ones where a lot of the employees have gone onto the exchange and now they aren't able to keep group coverage for the business??

 

[JustAMarketer]

What do you mean by collapsing groups?? Ones where a lot of the employees have gone onto the exchange and now they aren't able to keep group coverage for the business??

It's where you go to an employer who has a group plan and show
them how "collapsing" the plan and getting their employees on
ACA plans saves both them AND the employees money. You
create a SEP when you do that.

Sometimes paying the penalty (if the group is over 50) will cost
less than the group insurance. And this way, you can get the whole
family an ACA plan, whereas before it would have been cost-prohibitive.

It's a simple concept but a somewhat complex process. That's why
we use a TPA for helping out with this, setting up ind. bank accounts
for each employee that they can't touch, etc.

 

[johntrice]

The ACA software compliance review is best for larger groups that will continue their Major Medical. Here's why: the larger groups have Major Med. and will continue under the mandate. This makes compliance an issue for them; therefore, it is at least on their minds. You can try to change their minds about offering no medical insurance to employees and paying the fine, but that is much easier said than done.

Smaller groups not covered under the mandate, feel that they are not under requirements of the new law. Yes, you can easily move them to the ACA saving them money due to the subsidy and sell the difference in cost in new supplemental insurance. This also assumes you are not working with a group of high end earners.

Remember, penalties for not offering health will get worse each year. One of the top IMOs working with smaller groups is in your city. They, like you, have a bank set up as a TPA. The problem you will have is taking agents who are used to working with small groups or indivuals and giving them the confidence to work with a larger group. That means not only does the agent need to understand the ACA but also your software.

Why not look at a different approach? Your objective is to sell insurance. The easiest route is the best most often. Use the software to offer an internal solution. Larger groups with compliance issues can be a wonderful target if you show them how to address the issues and lower costs. Just to let you know, we had an agent earn $560,000 in commission in a 500 man group by solving the compliance problem while still offering Major Med. Had he tried to move this group to the ACA, my feeling is his commission would have been zero.

 

[pcbinsurance]

Be careful how you use the letters IRS --- especially when the real IRS plays a major role in all this. I'm sure you have a lawyer to figure all that out though.

 

[tonyisme]

I would be super pissed if my employer took away my health insurance and it might wreck my confidence with the employer... I might start looking around and develop an attitude at my workplace especially if it upsets my wife....

 

[johntrice]

Remember under the program parameters given, the employee isn't moved into the ACA without a payroll deduction thus the need for the TPA. From the employees point of view, the agent enrolls them into the Exchange and then the payment is deducted from the employees pay. As long as there is a paper trail the the employee is paying the full amount less subsidy, the requirement for employee paid health is satisfied. All the employee knows is what is coming out of their pay is far less than was coming out before.

The agent offers a "package" to the employee for Major Medical (the Exchange Plan) plus supplemental insurance up to last year's employees out of pocket. Again, from the employees point of view, they are getting more coverage for the same or less out of pocket, so it is unlikely they will be unhappy if the deductions are addressed in the enrollment process.

The trick is to have a TPA that takes the deductions and places them in a bank account for EFTs. Often this is a new bank account opened just for this purpose. Many of the employees will actually be in better position than simply having a group Major Med. so most will be happy with the new plan.

Since the Major Medical coverage can not be paid for by the employer, the firm actually saves a ton of money assuming they were paying any part of the employee health plan. Owners are in fact, transferring the cost of Major Medical over to the taxpayer via the Exchange. I believe this will be the model in just a few years, particularly in small groups.

 

[Yagents]

I would be super pissed if my employer took away my health insurance and it might wreck my confidence with the employer... I might start looking around and develop an attitude at my workplace especially if it upsets my wife....

I couldn't imagine what would happen if they took away your car insurance too !

 

[tonyisme]

I like it when they switch plans or take away the medical insurance when somebody sick or has cancer that's a whole lot of fun especially when the new doc or new facility won't take new insurance. As an agent you have to go in there and call their Doctors and try to figure out which Insurance they will accept.. especially when there's bilingual people & really don't speak English well.
And then there's those out of network cases that's really really fun

 

[mkd1204]

I hate to poo poo your idea but there are far easier ways. This is a ton of work with some huge obstacles and the commission won't make it worth it. You'd be better off selling group health or just straight ancillary benefits.

What if the majority of the employees make too much money and they get no credit? If they make little enough to get a credit, how much disposable income will they have to purchase other insurance from you? What if the increased income that is now being reported to subsidize the individual health puts them over the limit with IRS and they get no or little credit? What if they don't want to create the account on healthcare.gov? What if they drag their feet? Anything that can and will go wrong, will be blamed on you and it only takes a few employees to poison the well and trash your name to everyone.

I tried helping a few people with the exchange and to me, it was a huge hassle and time suck. I still have no clue if I got paid and I really don't care because to try and figure it out would take up even more time and in the end I would get maybe $50-$100.. At least in NJ, the money for IHC does not make it a worthwile product unless you are good at packaging some other product like term life or something else.

Do the compliance test, quote their group health and sell them that! Anything but collapse the group. Save yourself the heartache.. Just my 2 cents.