Benefits plans are notoriously opaque. If you have ever asked what a procedure or a visit with a specialist will cost ahead of that appointment, you probably spent several hours on the phone with your insurance company and may still not have reached a clear, definitive answer.
This is a problem in its own right, but that lack of transparency creates other problems that are often hidden from employers. One of the biggest of those problems is that middlemen in your plan, like your advisor or your broker, may be making extra profits based on how your plan is used.
Who profits when your employees get sick?
While benefits plans have a number of layers where an advisor or a broker can make extra money off of you, these are the most common scenarios we see:
- Pharmacy services
- Medical management
- Telemedicine
- Rebates
In some cases, advisors can make a bonus on a per prescription basis. That’s a dramatic conflict of interest if those incentives are not disclosed. And advisor or a broker are tasked with helping you pick and implement the best plan for your business. If there are incentives baked into a plan that could influence that judgment, you deserve to know.
Aligning Incentives in the Right Direction
The first step you should take is to learn where to look for hidden incentives. Our compensation guide is the easiest tool for this (reach out and we’ll send you a copy).
With that guide, you can vet your current plan for incentives that may be good for your advisor but not good for your employees or your business.
Next, you should start to consider using incentives to your advantage. For example, advisors like us (and there are a growing number of this type of advisor), work under a model where we are incentivized to lower costs and increase the quality of care. In other words, our compensation is at its best when your plan is performing at its best.
Your goal is to lower the costs of your plan without compromising care. And our incentives are based on achieving that goal.
That’s how it should work.
Thankfully, the fight for transparency in benefits is moving in a positive direction, but we aren’t there yet. I’m happy to talk you through the challenges in the meantime if you’d like to schedule a call.
