Making the Level-Funded Sale 2017 Agent Training Module #5 February 2017 11670s0617

Changing Your Perspective Salesmanship

Changing Your Perspective Leadership

Delivering (Not Selling) Funding Advantage Your Value Proposition of Level Funding The health care adviser role Value of your time Your Value Proposition Qualifying the prospect

What is the Value Proposition of Small Group Level-Funded Health Plans? Strategic compliant solutions Cost reduction over time Flexible structure More information Better choices Rewards for good behavior Lifestyle improvements

The Value Proposition of Allied National’s Funding Advantage Level-Funded Plans: ACA-, ERISA-, DOL-Compliant Solutions A-Rated Carriers Maximum Liability is 12 monthly payments Cost savings over time Flexible plan designs More detailed claims data Better network choices Premium refunds with no admin charges Renewal offers on every case 1095B forms provided at no cost

Are you a Health Care Adviser? Skills Health Insurance Agent Pre ACA Health Care Adviser Post ACA Benefit Plan Designs X Marketplace Options – Carriers, Networks Cost Comparisons Commissions Compliance HIPAA, ERISA, DOL Self Funding Medical Underwriting Employee Engagement Regulatory Changes Claims Analysis & Review Referenced Based Pricing Direct Primary Care Long-Term Strategic Planning Fees Time 40 Hours per account/Year 70 Hours per account/Year

Who is a Health Care Adviser? A trusted strategic partner Professional equivalent of attorney or CPA Management team member Technical consultant Resource for compliance Resource for communications HR leadership and planning support Insurance market access point

What is Your Value Proposition as a Health Care Adviser? Solutions or policies? Professional or peddler? Value or price? Long term or short term? Adviser or Agent? Not a spread sheet sale!

What is your Economic Value as a Health Care Adviser? Your technical competence You understand employer’s business issues You serve the right clients Your systems, processes and support Your strong communications skills Your market access and knowledge Your creative solutions Your documented success stories

How do you quantify your Economic Value as a Health Care Adviser Quantify the value of ultimate cost saving over time Communicate the value of your time Communicate the scope of your services Communicate your reality Document your scope of services Disclose your fees Operate with a formal agreement

Qualifying Questions for a Prospective Employer from a Health Care Adviser Note: Make sure you are talking to the ultimate decision maker!! Why do you provide employee benefits? Do your employees understand the value of their current benefit plan? In total, how much have you spent to provide employee benefits to your employees over the last 5 years? What do you expect your cost of benefits to be 5 years from now? Are your current plans ACA-, ERISA-, IRS-, HIPAA- and HHS-compliant? Are you prepared for a DOL Audit? Has your current broker explained the implications of a DOL audit? Would you be interested in a product that eliminates insurance company profits and returns those profits to you? Do you know the difference between a health insurance broker and a health care adviser? What do we need to do to earn the right to become your health care adviser?

Have you Prepared Your Clients for a Department of Labor Audit ?? Sample DOL Audit Letter Dear Employer, This letter confirms my appointment with your company on (Month, Day, Time) to review your employee benefit plans……. The U.S. Department of Labor, Employee Benefits Security Administration, has the authority under Section 504 of the Employee Retirement Income Security Act of 1974 (ERISA) to conduct periodic investigations of employee benefit plans to determine whether such plans are conforming with the provisions of Title I of the Act or any regulations or orders there under………. “This review is an official investigation…………”

Sample Department of Labor Audit Partial list of required information All Cobra Notices for past 2 years List of all employees who had a qualifying COBRA event List of all terminated employees Summary Plan Description (SPD) of employee benefit plan All HIPAA Certificates List of denied claims WHCRA one-time initial notices All insurance contracts and billing statements Claim files, claim reports and any analytical data All documents pertaining to payment or denial of claims All benefits documents prepared by consultants, brokers, actuaries

Health Care Adviser Fees for Services Business Model What is your time worth? What is your skill worth? What rate will your market support? Can you communicate your value proposition? Can you justify your value?

What is the Value of Your Time as a Health Care Adviser? Key questions: If you had to charge an hourly rate to your clients for all the services associated with providing their ACA compliant group health plan, how much would that rate need to be? What is the current hourly rate we are actually receiving from the commissions we earn on this account? Is that hourly rate adequate to cover our costs and compensate us appropriately?

Calculating Your Current “Hourly Value” as a Health Care Adviser Total annual revenue Total man hours worked by producer(s) Divide revenues by man hours and multiply by 2* *(assumes 50% of your hours are billable to a specific client) The result is an indication of what your billable rate would be based on your current income

Sample Health Care Adviser “Hourly Value” Calculation Annual revenues = $300,000 Total producer(1) man hours – 2,200 $300,000 / 2,200 = 136 $136 x 2 = $272/hr This is an indication of what your billable rate would be based on an annual income of $300,000.

How many man hours can you afford to spend on a case over 12 months that generates $8,000 of annual income? $8,000 / $272 = 29 hours

What would you need to charge if this case required 50 hours of your time in the next 12 months? 50 x $272 = $13,600 (If you worked 50 man hours on this case at the current commission of $8,000 your billable rate would be $200/hour which would be a 27% reduction in pay)

Comparable Professional Rates? Hourly market rate for: Lawyers -- $250 to $1,500 Accountants -- $150 to $600 Engineers -- $350 to $600 Architects -- $350 to $600 Consultants -- $150 to $1,500 Insurance Agents -- $50 to $600

Specific Contract - Fee for services: Errors and Omissions Insurance: Other Considerations Specific Contract - Fee for services: Scope of services Terms and conditions Invoicing and collection Fees and commissions Errors and Omissions Insurance: Includes or excludes fee agreements ? Review specific exclusions

How Your New Value Proposition will Grow Your Revenues and Profits Adopt a fee-for-services business model Know and protect the value of your time Institute time management tools Document and analyze your operating costs Discontinue low-revenue, low-margin business Partner with competent resources

Allied National Sales Our Home Office Sales Team Dan Meylan: National Sales Director; 913-945-4253 Bill Ringhofer: Regional Sales Manager; 913-945-4266 Randy Wehner: Sales Manager; 913-945-4267 Jill Carroll: Account Executive; 913-945-4255

Thank you!