The time has come to pick a side in the looming war between the benefits and healthcare industries. Do you want the status quo or the forces of disruption?
Brokers and advisers must choose either to actively disrupt the status quo or to support it. There’s no middle ground.
With so much money at stake, the status quo won’t abandon the field without a fight. Revenue for 2018 for just the top five health insurance carriers totaled almost $450 billion. Combined annual revenue for the 20 largest brokerages now tops $2 billion, according to business intelligence data analytics firm miEdge. Resistance will be fierce.
But the imperative for change, for disruption of the status quo, is now inarguable.
The facts are indicting. The Status Quo has failed to control — never mind reduce — healthcare costs, which have increased every year since 1960, spiking a whopping 261% between 1999 and 2016. Since healthcare costs drive premium increases, insurance costs have risen almost 300% over that same period. Insurance and healthcare are becoming increasingly unaffordable for both employees and employers.
The benefits and healthcare status quo isn’t just failing employees and employers, it’s destroying the American middle class by stealing workers’ wage increases to pay ever-rising insurance premiums that enrich the carriers. From 1999-2018, family health insurance premiums rose 188% adjusted for inflation, while workers’ wages increased just 17%. Many employees have become functionally uninsured as deductibles have grown eight times as fast as wages since 2008. Under the status quo, the American worker is falling further behind every year.
These cost trends are destructive and unsustainable, yet the status quo continues to double down, ignoring the frequency and severity of claims and refusing to manage the healthcare supply chain. Only by disrupting the status quo and applying next-generation healthcare and benefits strategies can brokers and advisers begin to reclaim control over employer health plans and reduce the cost of healthcare for employers and employees. That requires you choose to become a disruptor.
Disruptors
Next-generation benefits advisers choosing disruption are moving employers away from fully insured plans to alternative funding arrangements that offer control over the benefits plan. With control, these advisers are leveraging other Disruptors to begin to reduce the cost of healthcare by managing the supply chain of healthcare services that employees purchase.
These other Disruptors include unbundled TPAs, benefit concierge programs, medical utilization managers, fiduciary PBMs, specialty drug cost mitigation services, reference-based pricing vendors, bundled-price surgery centers, direct primary care, and healthcare travel facilitators.
The bottom-line results these next-generation advisers are delivering employers are stunning. Year-over-year cost savings almost always range from 15-20% or more in year one. That’s a real decrease of 15-20%, with better benefits for employees. And first-year savings often hit 40% or more. No wonder employers are taking notice and the status quo is on edge.
Disruptors choose to actively challenge and upend the status quo. Agents of the status quo choose to actively promote it. Choosing neither makes you an enabler who helps maintain the status quo.
The time is now to choose: Disruption or the status quo. Although the war will be hard fought, victory and the future belong to the disruptors. Employees and employers will be the real winners. So, whose side are you on? Let your conscience be your guide.
