The motto of the Boy Scouts is Be Prepared. When I was in school I joined the Boy Scouts with lots of my friends. We had a great time learning various skills and earning merit badges. Camping, hiking, swimming, canoeing – we had a blast doing everything outdoors that we possibly could. Through those years I became an Eagle Scout. One thing that has always stuck with me was the motto – Be Prepared.
The motto has carried over into many aspects of my life, including business. However, observing other businesses and how well they’re prepared has been interesting. While we can’t anticipate everything, we can be prepared for many things.
The vast majority of businesses in the U.S. renew their health insurance plans on January 1st for obvious reasons – their plan year deductibles, out of pocket exposures, etc. for employees all begin on a calendar year basis and many businesses fiscal year is also on a calendar year basis which makes it easy to budget for.
However, when it comes to being prepared (PROACTIVE) for renewal increases, most businesses I talk to want to wait to see what their health insurance increase is going to be before checking out any options (REACTIVE)!
We take a very proactive approach with our clients and future clients. It’s the middle of August and we are already out to market seeking competitive quotes from TPAs, reinsurers, PBMs, and other vendors for a several reasons:
- To determine if more competitive options exist
- To keep the incumbent programs competitive with the rest of the market place
- Give our clients and prospective clients plenty of time with which to make decisions once they receive their renewal
- Budgeting sooner for their upcoming fiscal year
- We don’t get caught up in the massive quote requests sent in to underwriters by brokers and consultants who wait until the 4th quarter to go to market which delays everything.
- Plan design considerations and Open Enrollment communications to employees about any possible changes can be made sooner.
It’s always best to have alternatives “in your back pocket” and be prepared for what may come your way in this upcoming renewal period if you need to make a change. Don’t simply take the easy route and accept an increase from your insurance company – regardless how small or large it may be, and certainly don’t take the REACTIVE approach of ‘wait and see’.
We are getting quotes that are actually lowering our clients and future clients’ costs – not increasing them. There are many opportunities to do so with different programs that don’t necessarily require benefits to change for employees. What we’re finding is that businesses are not being informed of those opportunities because their broker/consultant is not aware to them, chooses not to show them, or that employers simply think that there aren’t any options to effectively control costs.
If you want to be PROACTIVE and get some alternatives to your upcoming renewal (don’t wait until the last minute) give me a call at 970-349-7707 or email me at [email protected] and we can chat about our processes.
