On the heels of healthcare reform, 2016 be-gan with the expansion of the small-group employer category—the bedrock of the U.S. economy. Now defined as companies with one to 100 employees, the market that once consisted of independent grocers, auto-repair garages, restaurants, dry cleaners and beauty salons has grown to encompass larger companies such as financial services firms, car dealerships and more. In this era of healthcare reform, the small-group market stands to benefit from the abundance of options and flexibility evolving in the marketplace. As employers seek to identify, select and manage health benefits for a diverse workforce, this ultimately creates new opportunities for brokers as the expert curators of insurance options, while streamlining and simplifying the process along the way.
THE NEW SMALL GROUP
Each company that has been formed in the U.S. was once a small business. For example, Apple started in Steve Job’s garage with two workers and now employs thousands. This makes the U.S. economy the small-employer economy, where growth and the need for health insurance and additional benefits begin. The data varies between sources such as the Census Bureau and the Small Business Administration, but the number of private-sector businesses nationwide that fit the new small-group criteria is estimated to be between 5.5 million and 6.6 million small businesses. All told, these firms employ some 60 million people. The newly added companies to the small-group category now must navigate an unfamiliar set of regulations. This, combined with a multitude of compliance issues, has firms turning to industry experts to simplify and make the best choices possible. Health insurance questions remain too complex for most small employers and their workers to navigate and manage alone. It is among the reasons why state and federal government exchanges nationwide continue to target this market sector. However, brokers open the door to a full spectrum of industry-wide programs and customer-driven tools found in private exchanges that cater to small businesses.
For example, many brokers are empowering potential enrollees and members to search and customize plan options for their specific needs using a variety of resources such as budget-planning tools, online provider directories and prescription search tools to help fine-tune programs that work best for all parties. The added guidance of a benefits advisor with personal support when needed makes a crucial difference.
MANAGING CHOICE OVERLOAD
Today’s exchange marketplace trumpets the virtues of variety. The reality is that choice works best when it is smartly optimized. An abundance of unstructured plan options are simply overwhelming for small businesses. This can prove costly if either ends up making random decisions about selecting a plan or, worse, not picking one at all. The results are consumers who may be confused, frustrated, unhappy or—perhaps most important—improperly covered for their needs. Without a doubt, healthcare reform and government-sponsored exchanges have accelerated consumer appetite around the idea of choosing the best coverage that works for them. But actually making the best decision without professional counsel or through a well-designed provider platform supported by strong broker and customer service team is another thing altogether. Today’s market now offers vast plan options that people generally find difficult to understand and differentiate, let alone knowing what is best to choose. A 22-year-old single female starting her first job out of college will want a different plan than the 59-year-old manager with a spouse, three children and plans to retire in the near future. Brokers and benefit advisors offer the know-how and experience to effectively bridge these gaps. Providing clients with expert counsel, guidance and service, health insurance becomes simple and empowers employers and workers to hone in on the best range of plans to select the health coverage that fits their needs. Professionally licensed benefit advisors also routinely serve as de factor human resources, personnel and/or payroll departments for many small businesses. This is particularly true as the small employer tends to have fewer staff and resources to research, manage and administer plans. Those providing high-touch and personal service to their clients have the best opportunity to increase their business in the brave new small-group world.
THE FUTURE
The bottom line is that the expansion of the small-group market has more options, flexibility and opportunity than ever. Employers now pay more attention to budget and compliance while factoring in the needs of all their workers and dependents. David Chase, healthcare policy director for the Small Business Majority, a national small business advocacy group, summed it up well: “If you’re a small-business owner, you know how to provide your product or service. But when it comes to health insurance, it’s a very foreign concept for them. They’re out of their element, while brokers do this for a living.” Employers will continue to seek expert counsel, guidance and service from brokers. Benefits professionals that offer the right combination of service and ongoing, customized support far beyond initial enrollment will become more in demand. Their ability to zero in on the best range of options while providing expert insight when identifying health plans that fit an employee’s individual needs and stage in life are becoming an in-demand service offering for the nation’s small business community.In the end, business owners need professionals who offer healthcare coverage expertise and know-how, and in turn deliver service with a personal touch. This is where smart, knowledgeable and service-oriented brokers and professionals have the most to gain.