PCORI Fees Due to IRS No Later Than August 1, 2022

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Fees to fund the Patient-Centered Outcomes Research Institute (PCORI) are due to the IRS no later than August 1, 2022, from employers who sponsor certain self-insured health plans such as Level Funded and Health Reimbursement Arrangements (HRAs) that are not treated as excepted benefits.

How to Pay PCORI Fees
Employers that sponsor certain self-insured health plans (Level Funded) must report and pay the required PCORI fees via IRS Form 720 along with HRA plans, Quarterly Federal Excise Tax Return. Complete Part II, line 133. Employers should note “2nd Quarter” on the 720 form.

Click here to access the updated 720 form.

The fee applies to each Plan year that ends after October 1, 2012, and before October 1, 2029. “Plan year” refers to the plan year for your Level Funded Medical Plans or an HRA plan. Generally the plan year and the coverage period are the same. As an example, if your HRA benefit resets each January 1, your HRA plan year and your coverage period are generally a calendar year and end December 31.

Plan Year Ending Date Fee
October 1, 2020 – September 30, 2021 $2.66
October 1, 2021 – September 30, 2022 $2.79

There are three available methods that can be used to determine the average number of lives covered under a plan for the policy year. For an HRA plan it is acceptable to use the number of subscribers only. The most commonly used method for determining the fee for your Level Funded plan is the “Snapshot Method”.

  1. Actual Count Method: A plan sponsor may determine the average number of lives covered under a plan for a plan year by adding the totals of lives covered for each day of the play year and dividing that total by the total number of days in the plan year.
  2. Snapshot Method: A plan sponsor may determine the average number of lives covered under an applicable self-insured health plan for a plan year based on the total number of lives covered on one date (or more dates if an equal number of dates is used in each quarter) during the first, second or third month of each quarter, and dividing that total by the number of dates on which a count was made.
  3. Form 5500 Method: An eligible plan sponsor may determine the average number of lives covered under a plan for a plan year based on the number of participants reported on the Form 5500, Annual Return/Report of Employee Benefit Plan, or the Form 5500-SF, Short Form Annual Return/Report of Small Employee Benefit Plan.

Payments should be made payable to the U.S. Treasury and sent by August 1, 2022, to the address below:

Department of the Treasury
Internal Revenue Service
Ogden, UT 84201-0009

The following documents accompany this notice:

Tools to Assist you by Carrier:

All Savers®

All Savers posts the employer group’s membership information to the employer website. The employer group is required to complete and file the IRS Form 720. For general questions please contact All Savers Broker Services at 1-866-405-7174.

Humana Level Funded

Humana provides a snapshot report that shows the monthly membership employers will need when filing the PCORI. It is an employer report (instructions below). As a broker, the employer may grant you access if they want you to pull it for them.

Click here to review the instructions.

Aetna Funding Advantage

This link takes you to the Aetna Funding Advantage PCORI Fee Estimator Tool. This tool gives you guidance on calculating the PCORI fees for this group.

 

**Anthem OH SOCA MEWA, Anthem KY Chamber Advantage, Anthem IN Chamber Health Alliance, MMO COSE MEWA, Humana KY Chamber and UHC MEWA have built the PCORI fees into the premiums, therefore, you will not need to file and pay any additional fees.

What Happens to Unused Amounts in Employees’ HRAs When Their Employment Terminates?

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This post was originally published by EBIA.

QUESTION: Our company is thinking about adding an HRA that would be integrated with our major medical plan. Employees could carry over their HRA balances from year to year. What happens to those balances when an employee’s employment terminates?

ANSWER: Your company has some choices about what will happen to HRA balances remaining at termination of employment. The HRA may be designed so that employees forfeit their unused HRA balances when employment ends (typically after a limited post-termination opportunity to submit reimbursements for pre-termination expenses). Or your company may choose a design that permits employees to “spend down” their HRA balances and receive reimbursement for eligible expenses incurred after employment termination until the HRA balance is depleted. Alternatively, the HRA could be designed so that all but a nondiscriminatory class of employees forfeit unused amounts at termination. Regardless of which design you choose, terminated employees may not be “cashed out” of their HRAs (i.e., provided with cash or other benefits in an amount equal to some or all of the HRA balance), because a cash-out feature would trigger taxation of all HRA distributions, whether or not they were used to pay qualified medical expenses. The design choices you make should be clearly stated in the HRA plan document and explained to employees in the summary plan description and other communication materials.

Whether or not the balance is forfeited, COBRA must be offered unless an exception applies (e.g., because the HRA is sponsored by a small employer that is exempt from COBRA). If COBRA coverage is purchased, the recipient will have access to the HRA balance (notwithstanding any forfeiture rule), increased by any account credits that would be received for the coverage period by a similarly situated non-COBRA beneficiary. Note that COBRA’s application to HRAs raises some complex issues that are beyond the scope of this answer.

If an employee dies while eligible to incur reimbursable expenses, the HRA may allow the employee’s accumulated balance to reimburse the substantiated qualified medical expenses of the employee’s surviving spouse, children who are under age 27 as of the end of the taxable year, or tax dependents for health coverage purposes. A deceased employee’s balance may not be used to reimburse the medical expenses of anyone other than those individuals (there is a limited exception for certain state governmental HRAs), or paid for any reason other than medical expense reimbursement. For more information, see EBIA’s Consumer-Driven Health Care manual at Sections XXI.F.12 (“Forfeit Account Balances or Permit Spend-Downs?”), XXII.C.2 (“Treatment of HRAs Upon a Participant’s Death”), XXIV.F (“No Cash-Out of Unused Amounts”), and XXV.B (“HRAs and COBRA”). See also EBIA’s COBRA manual at Sections IV.C (“Small Employer Exception”) and XI.G (“How COBRA Applies to HRAs: Unique COBRA Administration Issues”).

Why Employer Groups Really Need to Address Leave Policies

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Without a leave policy, employers can get into a difficult situation before they know it. It’s a little like trying to get toothpaste back in the tube—you can only fix it going forward. This is why we recommend all employers take the time to get an employee handbook together with a leave policy.

Here are some of the headaches and heartaches that can occur when an employer doesn’t have a policy in place

  • A valued employee suffers permanent disability with no source of income until approved for social security disability (SSDI). Did you know 70 percent of claims for Social Security disability income benefits are denied each year? Or that many people die before disability benefits can be reviewed in the courts?
  • An employee gets in a car accident and can’t work for six months and has no source of income.
  • An employee has a partial disability and can’t work full-time for a period of time. When do you remove them from the plan?
  • An employee visits a foreign country and is unable to return due to travel restrictions or being held against their will. How long do you cover them under your plan?
  • An employee goes on maternity leave but doesn’t return to work after leave. What happens if you didn’t collect premiums while they were on leave?

Without a clear leave policy that defines when benefits end or how benefits are paid during a leave, employers have the potential to become embroiled in some unpleasant situations. Some examples include: making a very hard decision to separate with an employee in what can be a terrible situation, creating a public relations backlash, inadvertently demoralizing their workforce, or being faced with a costly lawsuit.

Many expect their health insurers to set the rules, and while most carriers perform random audits of eligibility to ensure that covered employees match up with payroll, others take a more judicious view to allow employers the flexibility to comply with state and federal leave laws like Family Medical Leave or if the employer covers employees during a short or long-term disability. Their policies in this case don’t state that the group has to terminate an employee who has reduced hours or isn’t actively at work. While this allows the employer flexibility, it also requires the employer make the call for when to remove an employee from coverage when and if they no longer meet the criteria to be covered.

The best way to alleviate this is to have clear, documented leave policies in an employee manual to address a variety of scenarios.

Questions to consider with a leave policy

  • What is the employer’s paid-time-off policy? Do they offer a bank of sick time? How and when is that used?
  • Does the employer offer long-term disability or short-term disability coverage? When do the policy benefits kick in?
  • How will the employee pay their portion of the cost of health coverages? Will it be required during their leave or will the employer recover it from future paychecks when they return to work? What if they never return to work?
  • Is the business subject to Family Medical Leave? Do they have employees in states with state or local Family Medical Leave rules (like NY, CA)?
  • Does the employer have the ability to make modifications to jobs to permit an employee to work in a different capacity for a period of time? If not, what then?
  • What happens if an employee can’t work due to illness or disability for an extended time? What happens if the employee is no longer working full-time? When should an employer remove them from the medical plan and offer COBRA or, if applicable, state continuation of coverage?
  • Is the employer required to comply with ADA requirements? Would job modifications create a hardship for their business?
  • Could an employer’s generosity in keeping an employee on your plan hurt them in the long run? For example, they could meet their deductible and out-of-pocket on the plan in the first half of the year, get terminated from the plan, go on their spouse’s plan and have to meet another deductible and out-of-pocket amount. Or, they could miss out on an open enrollment period altogether such as for individual coverage although the loss of coverage would constitute a qualifying event, some options may not be available even mid-year.
  • When should employers have the discussion about options to continue coverage such as COBRA or state continuation of coverage? State continuation of coverage applies to groups under 20 in Ohio and Kentucky, but is not a concern in Michigan or Indiana.
  • An owner or partner will necessarily be treated differently since they are often beneficiaries of the revenues of the business regardless of their ability to work for the business; however, for family-owned and operated businesses, employers have to be careful of discriminating with leave policies, such as offering paid leave for one employee but not another especially those doing the same job. What impact would there be for the business if one or more of the key employees or owners is not able to work for a period of time? Unlike medical coverage, disability insurance can be classed in various ways to ensure owners, key employees, managers and/or employees are protected.
  • Professional practices such as lawyers, doctors, engineers, or architects as well as owners or sales people may continue to earn revenues that come in after a disability or leave has started. Many policies offset benefits by these payments. If an employer has this type of arrangement, they can look at options that don’t do this offset if available from the carrier.
  • If the business isn’t subject to Family Medical Leave, would they grant a leave of absence? Would they hold a person’s job for them to care for a family member during an extended illness? Under what circumstances?
  • We hope this article was helpful and gave you food for thought to help your clients and their employees. Please contact your Cornerstone Broker Advisor to discuss coverage options that could help and point to resources for addressing the employer leave policies.

Rev Up for Fourth Quarter with Cornerstone! Here’s What You Need to Know

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Renewal season is nearly upon us. With it comes the inevitable time crunch convergence of renewals and open enrollment. Here are a few planning tips for your group business.

Renewals

Most renewals are released after the Department of Insurance approves 2022 rating for all product types. This is usually anytime between September and November. Most are released in October. Here’s the schedule we have so far (updates will come as we get them):

CARRIER

Product

Expected Timeline

Aetna

AFA

Tentative – 60 days prior

Anthem

Grandmothered/Transitional

Tentative – mid-to-end of September

ACA

Tentative – mid-October

SOCA MEWA

Tentative – early-to-mid October

OFB MEWA

Tentative – October

Humana

All

TBD – usually 60 days out

MMO

Grandmothered/Grandfathered

Targeting 1st week in September

ACA

TBD

COSE MEWA

Targeting 1st week in September

UHC

AllSavers

60 days prior to renewal

Transition / ACA

75-90 days prior to renewal

Ohio Chamber MEWA

60-75 days prior to renewal

If your client has an ACA plan and no major health issues, you can get base rates with a member-level census. Hopefully, the numbers are encouraging enough for the group to go ahead and do FormFire. More on this later.

Beat the rush! Remember, your client doesn’t have to wait for their renewal to get applications done in FormFire. Start your January clients updating FormFire in September or stagger a few each week from September to October. We have confirmed that all major carriers are accepting applications up to 120 days old for January 1 effective dates.

But we get it, clients want to see how the renewal looks before doing FormFire. This delay starts a chain reaction that we see over and over.

Here is a GIF summary of this process:

via GIPHY

Review the Following Steps to See How Delaying FormFire Creates a Tsunami of Avoidable Issues:

  • After waiting for the renewal and reviewing, the group decides they want medically underwritten quotes. They start FormFire in late October.
  • It takes two weeks to get all the employees in FormFire after herding all the stragglers. Plus, the system is a little slower at this time because everyone is doing it at the same time.
  • Some brokers submit their quote requests just before Thanksgiving, usually Monday or Tuesday before leaving town.
  • Nobody seems to understand why it takes 5 to 7 business days to get quotes back even though everyone is doing the exact same thing at the exact same time.
  • A small handful of brokers call on Monday after Thanksgiving weekend requesting status updates for their cases submitted the prior week. Let us give the answer now to save a phone call later­­––no, we don’t have the quote back yet.
  • Quote comes back in the first week of December, broker reviews numbers and requests rate relief which takes anywhere from 2 to 5 days, depending on the carrier.
  • Final rates are negotiated about the second week of December and can be presented to the client.
  • Some clients get frustrated by the amount of time that it takes and that they only have a few days left to decide when they’re either stuck with a tough renewal or must change carriers around the holidays. Inexplicably, if you can find a solution with savings, those same clients don’t seem to get upset at all.
  • Oops! People changed their election during employee meetings­­­­––usually one of the stragglers. For underwritten quotes, that means another couple of nail-biting days waiting for the underwriter to confirm if the rates will stay the same or change? Will the group change carriers?
  • It’s January 2. Employees call in wondering where their ID card is so they can fill prescriptions or make a dental appointment. They wonder aloud to their employer if they even have insurance. The employer calls the broker to make sure because now they are wondering too.

Every. Single. Year.

Consider These Passive-Aggressive Approaches to Motivate Customers to Change

  • When they say, “I want to wait until the renewal comes out.” What you want to say is, “Great. Let’s plan our meeting to review results in mid-December. It’s only going to take you a day or two to make decisions on plan design, figure out what to charge employees, and schedule employee meetings, right?”
    Or you could say, “If we wait that long to do FormFire, that puts our timeline for getting quotes into December. Are you sure you want to wait that long?”
  • When they say, “It’s only going to take us a couple of days to complete FormFire.” You shake your head and smile, saying, “You’re such a glass-is-half-full kind of person. I like that about you.”
    Or you could say, “Could your company offer a drawing for a $25 gift card to encourage employees to complete FormFire by the deadline? We also don’t recommend giving more than five total days including a weekend because people tend to forget if you give them too much time.”
  • Try this proactive approach: “I’m . . . [insert a line from below] . . . in late December so I want to get ahead of your renewal this year. Can we track back the timeline for getting your renewal completed before Thanksgiving?”

. . . having some medical procedures . . .

. . . going back to rehab . . .

. . . going to enjoy the holidays with my family . . .

. . . running away with the circus . . .

. . . working on planning our time better so we don’t both stress out . . .

Maybe don’t use any of these tips, we’re just trying to have some fun with this. But please DO think about how you can strategize now with customers to meet their needs better, faster, and with the best possible health insurance options available.

Bona Fide, Practical, Time-Tested Tips for Planning Your Renewals and Fourth Quarter Quoting

As soon as a carrier releases ACA rates, you can get those numbers with just a member-level census. Similarly, as soon as a carrier releases their base rates for underwritten products, you can get those numbers with just a census. Unfortunately, most ACA rates will not be released until the end of September, early October.

Why bother with base rates at all? Because you can quickly rule out underwritten products if, after reviewing the rates, you see that your current/renewal rates are either in-line with or below the base rates, OR, it can demonstrate for your client what they might be leaving on the table by not shopping with their medical information.

Remember, base rates are “best-case scenario” if a group is perfectly healthy. If you compare base rates to your underwritten renewal and there’s not much difference, you and the client can decide if completing FormFire makes sense. But brokers, please know that carriers want the chance at your healthy groups! If you want to help your groups, shopping healthy cases gives the market a good idea of where their rates need to be to win new business.

All major carriers in Ohio normally accept applications dated 120 days from the January effective date. Cornerstone confirms this each year. This means that FormFire applications can be started on September 1 or after. Please make sure the Client Detail page in FormFire is set to collect medical Information or you will have an embarrassing call later.

Consider building employee meeting materials and client spreadsheets for the upcoming year right now. The new EB3 benefit booklet builder tool can help you build out professional looking packets for employees, while also putting together annual notices, SPDs, the client POP document, and exploring alternative contribution strategies to review with customers. Learn more at www.crnstone.com/eb3.

We want you to remember that your Cornerstone representative is here and happy to help you wherever you are in the planning cycle of renewing and selling business. Updates about the timing on renewals and the release of 2022 rates will come out in our Monday Minute as soon as we are notified. Contact your Cornerstone representative with any questions.

Medical Insurance Carrier Coordination with Prescription Drug Discount Programs

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The high cost of prescription drugs is a serious problem for consumers. Health insurers either own or contract with pharmacy benefit managers (PBMs) to administer covered prescription drugs in their benefit plans. In addition to processing drug claims, PBMs also negotiate with both the drug manufacturers and the retail pharmacies to determine the cost of a particular drug to the plan sponsor and ultimately the consumer.

The pricing methodologies adopted by PBMs remain complex and opaque. Components include administration and clinical fees, retail markup, MAC lists, manufacturers rebates, and more. The end result is that the final cost of a drug can and does vary wildly; the same drug is never priced the same between insurance carriers. The adoption of high deductible health plans has brought this issue to the forefront. It is quite common for a member to see the cost for a drug change dramatically when their employer changes insurance carriers.

Enter prescription drug discount programs, which have become very popular with the advent of high deductible benefit plans. Programs offered by GoodRx, Clever RX, WellRx, and many others are routinely used by consumers to shop prescription drug prices. Their easy-to-use applications put the price of any prescription drug front and center for comparison purposes. Consumers often use these tools to compare what their own insurance plan is charging for a given drug.

Now that I have discovered that the cost of my drug is less with the discount card than it is with my insurance company, what are my options? If I use the discount card, will my insurance company credit my out-of-pocket expense towards my deductible? How does that work? Cornerstone surveyed our carrier partners to find out.

Cornerstone carrier partners Anthem, Aetna, Medical Mutual, Humana, and UnitedHealthcare will all allow members to use discount drug programs and file a paper claim to get deductible credit.

The amount that the member pays out-of-pocket can be applied if the prescription is a covered benefit and the dispensing pharmacy is in network. A paper claim must be submitted to the insurance company.

The drug in question must be covered on the members prescription drug list and all applicable clinical programs or plan provisions must be satisfied (PA, step therapy, and quality limits). Only the amount the member pays out-of-pocket will be applied to the deductible/out-of-pocket.

Prescription drugs can be expensive, but your clients have options. Cornerstone’s broker advisors are available to help you determine how best to serve your clients who are faced with the high costs of medications. Contact your representative today for more information.

Update to the Surprise Billing Legislation from Late 2020

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In late 2020, we reported the good news that the State of Ohio has passed legislation to curtail “surprise billing.” This was great news given that many of the major carriers in the state were paying claims out-of-network for peripheral services related to emergencies, anesthesia, radiology, and pathology services, which are not subject to patient choice in most instances.

The appeals process for these non-network claims to be paid at the in-network benefit level also became more stringent causing a lot of member, client, and broker dissatisfaction, expense, and time to resolve. The new state-based legislation opened pathways to require both insurance companies and providers to come to an agreement on reasonable payments to remove this burden on patients going forward.

The state legislation, however, did not impact air ambulances because they are regulated by the Federal Aviation Administration. While playing a critical role in life and death situations, air ambulances have extremely high costs, which in turn have become a huge patient burden since nearly all are run by out-of-network providers. After the insurance companies paid these claims out-of-network and up to the “reasonable and customary” amount, a Health Affairs study published in April 2020 found that patients received balance bills with a median cost of $21,698!

While there is a lot of frustration and debate about the most recent coronavirus relief package signed by Congress, the $900-billion deal included a nugget that will genuinely help patients in this situation, though not until 2022. The provision forbids surprise bills from hospitals, doctors, and air ambulances. Starting in 2022, providers and insurers will have to settle bills through arbitration under Federal law as well.

The next year will still present challenges for patients who need air transportation. In the meantime, our recourse as brokers is to help members in these situations as much as possible. We must place pressure on insurers to negotiate arrangements that don’t penalize members and on elected officials when and if those negotiations fall through.

Check out this article from Kaiser Health News for additional information about updates to cost transparency.

Resources

https://www.claimsjournal.com/news/national/2021/01/04/301271.htm

https://www.healthaffairs.org/doi/10.1377/hlthaff.2019.01484

What are the “Transparency in Coverage Regulations”?

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Initially proposed in 2019, a final rule released on October 29, 2020, by the Department of Health and Human Services (HHS), the Department of Labor (DOL), and the Department of the Treasury delivered on President Trump’s executive order on Improving Price and Quality Transparency in American Healthcare to Put Patients First. These regulations are intended to improve price transparency, as required by the Affordable Care Act (ACA).

Transparency in coverage refers to an ACA provision that requires health plans and insurers to disclose certain cost-sharing information to participants, beneficiaries, enrollees, and, in some cases, the public through an internet-based self-service tool and, upon request, in paper form. These disclosures are required for an initial list of 500 items and services for plan years that begin on or after January 1, 2023, with all items and services to be disclosed for plan years that begin on or after January 1, 2024. The requirements apply to most fully insured and self-insured group health plans, and to insurers, but “Grandfathered” health plans, excepted benefits, and short-term limited duration insurance are exempt. HRAs, health FSAs are generally exempt as well. It is important to note that “Grandmothered” health plans are required to comply.

Here are some highlights:

  • Estimated Cost-Sharing. Plans and insurers must disclose the estimated amount that the individual must pay for a covered item or service under the plan’s terms (including deductibles, coinsurance, and copayments).
  • Accumulated Amounts. The amount of financial responsibility that an individual has already incurred when the request for cost-sharing information is made (i.e., deductible or out-of-pocket limit) must also be disclosed.
  • In-Network Negotiated Rates. Plans and insurers must also disclose the amount they or a third-party administrator have contractually agreed to pay an in-network provider for a covered item or service, such as negotiated rates (including for prescription drugs) and underlying fee schedules that result from using a formula (e.g., 150 percent of the Medicare rate) as a dollar amount.
  • Out-of-Network Allowed Amount. The maximum amount that would be paid for an item or service furnished by an out-of-network provider.
  • Items and Services List. A list of the covered items and services must be disclosed when an item or service is subject to a bundled payment arrangement.
  • Notice of Prerequisites to Coverage. Individuals must receive a notice informing them that a specific item or service may be subject to a “prerequisite,” which is defined as concurrent review, prior authorization, and step-therapy or fail-first protocols.
  • Disclosure Notice. A notice with several specific disclosures, including a statement about balance billing and disclaimers about differences in actual and estimated charges.
  • Public Disclosures. Plans and insurers must make extensive price transparency disclosures to the public in machine-readable files updated monthly. The disclosures must show negotiated rates for covered items and services between the plan or insurer and in-network providers, as well as historical payments to, and billed charges from, out-of-network providers. (In a change from the proposal, a separate machine-readable file must set forth prescription drug information.) These disclosures are required for plan years beginning on or after January 1, 2022.

As your general agency partner, we want to provide the most updated and relevant industry information that could affect your business and your clients. As always, please reach out to us with any questions.

Check out this article from Kaiser Health News for additional information about updates to cost transparency.

Social Security Spotlight: Social Security Offices Closed to the Public

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Social Security offices have been closed to public visits since March 2020 and will probably continue to be closed into the New Year until the rates of infection subside.

Most employees are working from home and a limited number of employees go into offices to process mail and to other internal work. You cannot visit Social Security Administration offices for an in-person interview. However, a lot can be handled online, like change of address, direct deposit, claim status, and filing retirement/disability claims and appeals if you have set up a “My Social Security” account on their website. You can also schedule phone appointments to file claims through the national 800 number (800-772-1213). However, appointments may not be available for weeks or months, if at all.

Filing online is easiest for retirement and disability benefits. I offer this service for retirement and disability clients who want an expert to handle their case. When I assist you, the claim information is sent to one of several intake centers throughout the United States. Social Security will send you a hard copy application to sign and return and your retirement claim is usually processed in 30 days or less.

You can call local offices with other questions on important issues. Local office numbers can be found at www.ssa.gov on the “Contact Us” page (on the home page) and “Locate an Office”. Simply enter your ZIP code and the local office address and phone number will be provided.

Social Security available to handle most situations, albeit some slower than others due to necessary precautions. They have prioritized workloads. Hopefully things will change some time soon in 2021 and we can all get back to the new normal!

Wishing you all a safe and healthy holiday season and looking forward to 2021!

About Dennis Heywood

Denny’s career with Social Security provides an in-depth, working knowledge of the Social Security Administration’s internal organization and processes. An expert in all phases of SSA programs: retirement, survivor, disability, and Medicare, Denny has expertise with the complex Social Security regulations based on more than 40 years of experience.

ss-help.com

Client Retention Strategies that Actually Work: Advice from Your Friendly Neighborhood Marketing Specialist

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How you continue to communicate after the sale is vitally important for maintaining lasting client relationships. Many businesses spend most of their marketing dollars on lead generation and finding new clients, but did you know that acquiring a new customer can cost five times more than retaining an existing customer? Part of a successful marketing strategy is maintaining your long-term client relationships and ensuring that you continue to deliver on the promises you made when you recruited them.

Retention is important and the proof is in the data. According to Yotpo, 60 percent of customers will tell family and friends about a brand they are loyal to. Good customer service and fostering successful relationships with existing clients will, no-doubt, set you apart from the competition. Your clients’ interest and their loyalty depends on how you communicate and what value you offer after the sale.

Here are our top five tips for creating and maintaining long-term client relationships with retention marketing strategies.

At the Root of Connection is Communication

Consider your own experiences with the businesses you are loyal to. What sets them apart from their competitors? Sure, the product they are selling plays a big role, but what about their customer service? Were the representatives attentive? Did they personalize your experience?

As with most relationships, the key is communication. Check in on your clients: How are they doing? What are their current pain points? How can you make their life easier? Do you have anything in mind that could improve their health insurance experience?

It is especially important to determine your client’s pain points. Just as you would ask them questions before you jump into your sales pitch, you want to employ similar tactics when checking in. What are they struggling with? What kind of experience are they looking for? For an individual client, for example, they may struggle with understanding health insurance terminology and how the system works, or maybe they have budget concerns that make it difficult for them to find a plan on their own. Recognize these pain points and tailor your messaging, both at the point of sale and beyond, to match those needs. If a client was concerned about budget at the point of sale, perhaps your mid-year communication should be a check in for how well the plan they chose has worked for their financial concerns. Get to know your clients and understand what they need from you so that you can continue providing high-quality service.

It is important to personalize your communication. Instead of sending a generic email to all your current clients at once, take some time to contact them individually and give them the time and attention they deserve for being your client.  But the key with this communication is brevity. No one wants to wait a long time to have their issues resolved.

Mind your Ps and Qs

While there are plenty of elegant digital communication opportunities available to you, a simple, hand-written note can go a long way. Keep a box of stationary handy so that you can write “thank you” notes to your clients after a positive interaction. Keep the message simple and show your gratitude for their business.

Personalized notes show enthusiasm for your partnership and tend to stand out more than an email. For example, if you meet with a client for an annual review of their plan, it’s important to follow up with a “thank you” note about how grateful you are for their business. After all, without your clients, your boat doesn’t float.

(Hint: A “thank you” note may also be a great way to request a referral from existing clients.)

Stand Out in a World Where Content is King

It is estimated that the average person is exposed to up to 10,000 ads every day, a large increase from up to 5,000 ads per day in 2007  (Yankelovich). That’s a lot of exposure, which means many messages are lost in the shuffle. You need your name to stand out among the noise, even after you have made the sale.

Though your current clients have already committed to your services, it is still important to make sure your message stands out against the competition. Keep your clients in the know about your business, how you are staying on top of trends in the market, how you interact with your community as a whole, and how you continue to adapt.

In the digital world, there are countless marketing tools you can use to maintain positive retention results. Can you guess what we’re going to suggest first?

Website

That’s right. A well-constructed and easy-to-navigate website is also a must to encourage your clients to come back for your services. According to Accenture, 48 percent of all consumers have left a business’s website and purchased elsewhere because the website wasn’t easy to navigate. We have sung the praises of websites for years, but that’s because a well-designed and responsive website is a must-have for all businesses. Even if your business is small or runs entirely on referrals, you need a website. You need a clear way for potential and current clients to get in contact with you, whether that is through a “Contact” page, an online chat option, or a “Get a Quote” form.

Getting a website up and running is simpler than you may think.  Plenty of web developers are available to help you get started with a site or update your existing site to be more user friendly. There are also a number of point and click tools online like Squarespace, Weebly, and Wix, which are specifically designed to help those with no web design experience to put together a simple, functional website.

Social Media

Do not overlook the reach of social media as well. According to a 2019 survey conducted by Pew Research Center, around 7-in-10, or 69 percent, of total U.S. adults use Facebook to connect with friends, family, and, now, businesses. Having a social media profile makes you even more accessible to not only potential clients, but current clients as well. Through social media, clients can reach you through chat, keep up with company updates on your profile, and make a personal connection with you throughout the year. Facebook, LinkedIn, and YouTube are excellent places to start. For more information about social media for your business, check out the Build Your Brand webinar we presented with 2060 Digital earlier this year.

Newsletter

You can also consider offering your expertise is through a weekly or monthly newsletter. Include blog posts from your website, links to reputable sources, an update from your business, behind-the-scenes shots of your company at work, and so on. You also want to think outside of the box. What health and wellness topics can you highlight? Maybe you can try to run a Caption Contest in your newsletter and offer a $5 gift card to the winner. If you are an employee benefits broker, consider spotlighting your clients’ businesses in your newsletter.

What is working and what isn’t

Creating content that draws the attention of your clients will require trial and error. Keep an eye on your open rates and your clicks to get a better understanding of the kind of content your clients are interested in seeing. High open rates and high click rates mean the content you are providing is of interest to your clients.

There are plenty of resources out there to get you started, but in a digital world, good content is king. Don’t overlook it.

Invest in Your Clients’ Health Insurance Education

As their health insurance agent, you can give your clients the tools they need to make informed decisions about their health insurance. When you educate your clients, you give them the power to advocate for themselves and become better shoppers.

In a 2015 survey by PolicyGenius entitled “Seeing Health Insurance and Healthcare.gov Through the Eyes of Young Adults,” it was reported that only four percent of Americans are able to correctly define all four terms that determine how much they would personally pay for medical services and drugs they receive under their health insurance plan (co-insurance, deductible, out-of-pocket maximum, and co-pay).

Through webinars, ebooks, worksheets, etc., you can provide your clients with guidance on the finer points of health insurance. Consider a vendor like GoToWebinar or Zoom to conduct a monthly webinar series about the basics of health insurance or use the “Live” tool on Facebook to hold live Q&A sessions with your followers. Websites like Canva can be a great tool for putting together marketing materials like flyers, ebooks, and worksheets when you don’t have much experience with design.

You can also take the guesswork out of the education process and send out a survey to your clients to determine what information would be most helpful for them when they’re choosing a new health insurance plan.

*Cough Cough* Check Out the Build Your Brand Webinar Series *Cough Cough*

It’s important to continually educate yourself on fundamental marketing strategies that can help you not only attract clients, but keep them. Cornerstone’s Build Your Brand webinars are focused on helping you level up your marketing. We have archived all of the 2020 webinars on the Cornerstone Resource Center for your convenience. Look out for more information regarding the 2021 series, coming soon!

 

Client retention is a metric of your business’s health and your long-term success. You have the clients—now what are you doing to keep them interested? If you are focusing only on lead generation rather than fostering the relationships you have already built, then you are missing out on a very important piece of your business.

Cornerstone is available to help you come up with a client recruitment and retention strategy that build long-lasting relationships and improves your bottom line. Contact us today to find out what we can do to help.

Additional Resources

Customer Retention Statistics and Predictions (Review 42)

What the Heck is ICHRA?

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As if insurance lingo was not quirky enough—PPO, HMO, ACO, EOB, PCP, etc.—now this? Before you get too frustrated, ICHRA may just be the answer for employers struggling with insurance administrative burdens and high costs. Remember, if you’re not ahead of the game, that means you’re behind and your competition might just steal your precious income.

What exactly is ICHRA? Individual Coverage Health Reimbursement Arrangement (ICHRA)—whew, that’s a mouthful so we will just stick with ICHRA (“ick-rah”). In June of 2019, the U.S. Departments of the Treasury, Health and Human Services (HHS), and Labor finalized new regulations to expand the usability of HRAs. This emerging concept of the ICHRA model is based on reimbursing employees for insurance rather than purchasing it for them. The biggest benefit? ICHRA allows employers to reimburse employees tax-free for individual health insurance or Medicare.

HHS and the Centers for Medicare and Medicaid Services (CMS) project that by 2029, roughly 800,000 employers will offer ICHRA, covering more than 11 million employees. This is a projection we should all pay very close attention to.

ICRHA may be a good option for employers struggling to provide affordable coverage, who no longer wish to administer complex group health benefit plans, who are considering dropping their group plan, who want to “baby-step” into the world of benefits (i.e., start-up companies), who want to cover normally ineligible classes of employees (i.e., part-time workers), or those who are not meeting participation guidelines.

ICHRA provides budget control by implementing fixed costs and eliminating future rate increases. The responsibility of the employer for health risks is now transferred to the employee and there are no participation rules. Employees have the flexibility to choose coverage that best fits their needs and their plans are portable no matter where they go. The premiums reimbursed by the employer are tax free to both the employee and the employer and the plans are still serviced by an insurance professional who ensures that the set-up, administration, and compliance issues are properly addressed at all times.

But there are two sides to every story right? There may be some downsides to these types of plans. Although the individual market is slowly returning and more options are available today than in the past few years, network issues, plan benefits, and the impact to any possible subsidies must be carefully considered. There are a number of compliance and tax issues as well, many of which may require a third-party administrator to handle. These are just a few of the situations that a professional benefits consultant will still need to appropriately guide their clients through.

In any productive needs analysis situation, there are many important considerations, from the overall goals of the employer, to budgets, to unintended repercussions to employees, and more. If you would like to explore these new options further, consult your Cornerstone representative today.

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