During his three decades in the industry, Don Goldmann has made his mark in a number of ways.
He got his start in life insurance, then moved to Southern California in the early 1980s just as HMOs were gaining momentum. After years of working his way into the corporate side of the business, he eventually decided to get back to selling, and helped start an agency called Group Benefits Plus.
When his partner retired, Goldmann joined the Word & Brown general agency. Goldmann was named president of the National Association of Health Underwriters(NAHU) in July, and he continues to serve as a vice president at the Word & Brown in Orange, California.
Goldmann recently told Benefits Selling about NAHU’s plans for the coming year, his thoughts on outside forces affecting the insurance industry, and the ways he sees brokers and other insurance professionals reinventing themselves in order to adapt to the ever-changing benefits environment.
Paul Wilson: What are some of the biggest changes you’ve seen in the industry during the last 30 years?
Don Goldmann: Technology is the number one thing that’s changed. But we’re still a people business, and the technology is never going to replace that interpersonal side. It does allow us to improve our system of distribution and sales.
There’s now so much information in the marketplace, that it’s impossible for one salesman to wrap his hands around that and get it in a presentable manner to a client without the technology.
PW: How about changes on the regulatory side of things?
DG: In the last 15 years, every state, and then the federal government, started getting involved in the micromanagement of the delivery system. They weren’t so much micromanaging what the doctors did; they were micromanaging the insurance or distribution system.
The language of the Affordable Care Act is about affordable care, but when you go through it, the vast bulk of it changes how we buy and sell it. It’s much more aimed at that then it is to actually doing anything in terms of making care more affordable.
PW: Where does that leave brokers?
DG: We’ve got to make the best of it. And I think the younger folks coming into the industry may actually have an easier time of it than the oldest folks who are going ‘I don’t want another round of regulatory changes. I don’t want to deal with this. I’ve got enough in my pocket, so I think I’ll retire.’
Twenty years ago, I came in not knowing anything about HMOs. But I adapted. Now, there’s a whole generation of folks who never knew a world without an HMO. Going forward, we’re going to have a whole generation who will never know a world that didn’t have federal regulations. And the argument about repealing it or not repealing it is going to fade to trying to do what we can to make it better for everybody, even if we politically disagree with it. And then there will be some change 15 or 20 years from now that this generation will be dealing with.
PW: What have you seen brokers doing to adapt to a new selling environment?
Well, lots of folks are using social media as a prospecting tool, although I think those who use it as their only prospecting tool are probably selling themselves short.
But if I can use social media to engage with someone, start to talk to them, and once I get that relationship established and make that first sale, then I have tools that allow me to stay in touch with them. I think the people who can embrace technology to enhance the relationship, not to substitute for it, are going to be able to do what every successful salesperson in this business has always done: sell multiple products to the same prospect.
PW: Speaking about products specifically, what shifts and trends are you seeing now?
DG: Unfortunately, the strongest trend has been for carriers, both on an individual and on a group level, to find ways to reduce the cost of product by thinning out the medical provider network—what they call “skinny plans.”
What that means is the agent, on behalf of their client, needs to have some robust technology to help them sell the network; they’re no longer just selling the price. I can get you a real cheap price if I skinny myself down to only 10 percent of the doctors in any given community, but is that really what the client wants?
PW: What else is changing around products? How can brokers take advantage?
DG: We’re starting to become a seasonal selling industry. We’re getting blasted by an enormous amount of activity on individual and small group in the latter part of the year, which leaves us an enormous amount of time in the other parts of the year.
That provides a good opportunity to sell other products. It allows us to look into areas like ancillary products that perhaps we didn’t really pay as much attention to before. A smart agent out there could now spend some of his slower months developing programs for marketing these ancillary products. And I think you’re seeing the carriers recognize that, too. That’s a big change.
PW: As the newly elected president of NAHU, what are your top priorities for the coming year?
DG: First, compliance. We’re working with the regulatory bodies all the time, the IRS, HHS, the DOL. We’re constantly trying to help them understand the real world, because sometimes they don’t quite get it. They think an employer will do this or that in reaction to something that they’re proposing, and they’re quite surprised when they discover the employer can do and probably will do quite the opposite.
Another area we’re putting a lot of time, energy and education into is the medical loss ratio. We’ve got a number of bills in front of Congress to try to allow the commission side of the premium to be calculated outside of the 85 percent medical loss ratio. This really wouldn’t change anything except the recognition that we as brokers work for the client; we really don’t work for the carrier. We’ve got to get that out of the 85 percent calculation.
Probably the biggest risk we see on the horizon is the Cadillac tax. The rate at which the tax will start to affect is so low; we’ve got states where you’ve got a bronze level plan, the lowest level allowed under PPACA, and it is already perilously close to a Cadillac tax. How do you reduce the cost of that as an employer? If you reduce benefits, you go below PPACA requirements.
The heart of the problem is they really didn’t have adjustments for the medical cost inflation that was going to occur, particularly when you pull into the system all the people who needed health care.
PW: Does NAHU have any specific plans for the upcoming election year?
DG: We have a very robust political action group called HUPAC [Health Underwriters Political Action Committee]. We are intent on trying to discover candidates on both sides of the aisle—we’re not Democrat or Republican—who align with our thinking about the industry.
We will provide complete interview sheets on the candidates. We’re not going in thinking that every person from one party or the other is automatically going to be a friend or an enemy.
PW: You’ve been a member of NAHU since 1986. What is the value of industry organizations to brokers and other professionals?
DG: By becoming part of something bigger than yourself, you become bigger. You become more worthwhile. And not just in terms of your ability to make a living; you become more worthwhile to your family and your community. You discover talents and you grow. That alone would be worth becoming involved with the association.
But if it turns out that you also can wrap this new growth into success in your career, that’s even better. I can guarantee you that in 1986, I never thought I’d be standing in a convention in New Orleans giving a speech as the newly installed president of NAHU.
PW: You hear a lot of doom and gloom sometimes about the the industry. Why are you optimistic about the future?
DG: In this industry, there are always going to be changes. Big changes, little changes. Heartbreaking changes that will take more work.
I for one am very positive about the industry, because we have people who are incredibly bright.
They’re probably the most generous people I’ve ever met. Generous with their time; with other competitors; with their money. You just can’t have that many positive people with that much positive energy fail. It’s not gonna happen. Change? Yes? Failure? No.