California Broker November 2016 by California Broker Magazine

VOLUME 35, NUMBER 2

SERVING CALIFORNIA’S LIFE/HEALTH PROFESSIONALS & FINANCIAL PLANNERS

NOVEMBER 2016

VOLUNTARY TALENT MAGNET Attracting and Retaining Essential Employees with Voluntary Benefits Also Inside:

Medicare • Self-Funding • LTC • Small Group View from the Top Evolution of Large Group • Dental • Life • HSAs • Technology • Vision

A A familiar familiar name name in in insurance insurance for for your your clients clients in in unfamiliar unfamiliar situations situations

Travel Medical and International Health Insurance Travel Medical and International Health Insurance Contact your local Blue Cross Blue Shield Representative or visit Contact your local Blue Cross Blue Shield Representative or visit www.geobluetravelinsurance.com or call toll-free at (855) 481-6647. www.geobluetravelinsurance.com or call toll-free at (855) 481-6647. ÂŠ2016 GeoBlue. All Rights Reserved. GeoBlue is a trade name of Worldwide Insurance Services, LLC, an independent licensee of the Blue Cross and Blue Shield Association. ÂŠ2016 GeoBlue. All Rights Reserved. GeoBlue is a trade name of Worldwide Insurance Services, LLC, an independent licensee of the Blue Cross and Blue Shield Association.

Demanding clients? Increasing competition? Narrowing networks? Really bad hair day?

appointments, travel, and the resulting, potentially illness, such as cancer or heart disease, they will have lots of conflicting, diagnosis. questions about how their life is about to change. But there

We c a n s o l v e

is one question they should never have to ask: do I have access to the best possible Instead, if their employer offersmedical MORE advice? Benefits, one of our

expert physicians will collaborate directly with their treating all (butof narrowing one) of these In a world networks they’ll problems! have to worry doctor, using our secure, technology. about finding the rightHIPAA-compliant in-network specialist to get a second If one of your client’s employees is diagnosed with a serious Working together ensure accurate diagnosis and opinion beforethey’ll treatment andanalso deal with scheduling illness, such as cancer or heart disease, they will have lots of appointments, travel,plan. and the resulting, potentially the optimum questionstreatment about how their life is about to change. But there diagnosis. isconflicting, one question they should never have to ask: do I have access to the best possible medical advice?

Allow your clients to offer their employees the peace

Instead, if their employer offers MORE Benefits, one of our In a world of narrowing networks have to worry mind fromwillhaving MOREthey’ll Benefits. expert of physicians collaborate directly with their treating about finding the right in-network specialist to get a second doctor, using our secure, HIPAA-compliant technology. opinion before treatment and also deal with scheduling Working together they’ll ensure accurate appointments, travel, andinto the resulting, potentially Integrates anyanhealth plandiagnosis and conflicting, diagnosis. the optimum treatment plan.

Employer-paid or voluntary benefit

Instead, if their employer offers MORE Benefits, one of our Allow your clients to offer their employees the peace expert physicians directly with theirtalent treating Lets will yourcollaborate clients attract and retain mind from having MORE Benefits. doctor, usingof our secure, HIPAA-compliant technology. Working together ensure an accurate Greatthey’ll pricing for your clientsdiagnosis and the optimum treatment plan. Integrates into any health plan

Great commissions for you

Employer-paid or their voluntary benefit Allow your clients to offer employees the peace of mind from having MORE Benefits.

Differentiates your portfolio Lets your clients attract and retain talent Integrates into for anyyour health plan Great pricing clients Complements Critical Illness Insurance Employer-paid or voluntary benefit

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TABLE OF CONTENTS 10

SENIOR EDITOR Leila Morris email: editor@calbrokermag.com

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California Broker (ISSN #0883-6159) is published monthly. Periodicals Postage Rates Paid at Burbank, CA and additional entry offices (USPS #744-450). POSTMASTER: Send address changes to California Broker, 217 E. Alameda Ave. #207, Burbank, CA 91502. ©2016 by McGee Publishers, Inc. All rights reserved. No part of this publication should be reproduced without consent of the publisher. No responsibility will be assumed for unsolicited editorial contributions. Manuscripts or other material to be returned should be accompanied by a self-addressed stamped envelope adequate to return the material. The publishers of this magazine do not assume responsibility for statements made by their advertisers or contributors. Printed and mailed by Southwest Offset Printing, Gardena, CA.

4 | CALIFORNIA BROKER

by Colleen M. Gimbel In my seven years of working in the Medicare arena, I have heard so many agents say they wanted to sell Medicare plans, but were afraid of all the rules. This got me thinking about what fear really means.

18 Brokers – Champions of Dignity

by Henry Figueroa Bringing dignity to clients is a good way to grow our business.

LEGAL EDITOR Paul Glad EDITORIAL AND PRODUCTION: McGee Publishers 217 E. Alameda Ave. #207 Burbank, CA 91502 Phone No.: 818-848-2957 email: calbrokermag@calbrokermag.com.

by Ron E. Peck Agents can use self-funding to retain their employer clients.

Overcoming the Fear of

CIRCULATION email: calbrokermag@calbrokermag.com BUSINESS MANAGER Lexena Kool email: lex@calbrokermag.com

A Game Changer for 30 Self-Insurance: Businesses and Advisors

15 Selling Medicare Plans

ADVERTISING Scott Halversen, V.P. Mktg. email: scotthalversen@calbrokermag.com

HEALTHCARE

The Evolution of Large Group and Its Opportunities by Chris Patton This quarter lies yet another opportunity to penetrate a largely untapped market for the agent who understands the special needs of the mid-market and can guide them through the ACA transition.

ALSO IN THIS ISSUE:

- CalBrokerMag.com -

VOLUNTARY BENEFITS

Attracting and Retaining Essential Employees with Voluntary Benefits How Brokers Can Help Close the Global Talent Gap with Voluntary Benefits by Wil Trohanis With mounting pressure on their bottom line, employers are constantly looking for innovative ways to engage employees and stretch benefits budgets. Short-Term Disability: Protection When Minor Injuries Become Major Problems by Stephanie Shields Some things to highlight when discussing voluntary short-term disability insurance with your clients. LIFE INSURANCE NEWS

VISION

Lights, Lenses, Action! Presenting A Picture Perfect Vision Plan by Tom Rosa Benefit brokers can be a true resource in making sure employers are selecting the right vision benefit plans.

TECHNOLOGY

Technology Helps Brokers Manage the Dark Side of Customization by Joe Donlan By offering the right technology you can help clients do a better job of delivering benefits.

HSA

The Hard Job Of Asking Soft Questions For a Successful HSA Program by Valerie Clark As employers tap into the abundant opportunities that remain in this sector, soft questions will be the ones that open the door to longterm success.

Voluntary Talent Magnet

22 Small Group View from the Top

by Leila Morris Experts give their take on the small group marketplace.

SELF-FUNDING

The Self-Insurance Solution: Exploring Self-Funded Plans In California’s HMO Country by Paul Johnson Brokers whose clients are rumbling about increases have the opportunity to offer an alternative: self-insurance.

MEDICARE

Part D Special-Election Period Triggers Little Windows of Opportunity by Roxanne Anderson Don’t turn away prospects or clients who want to change their coverage after the annual-enrollment period. They may be eligible for a special-election period.

EDITOR-IN-CHIEF Kate Kinkade, CLU, ChFC email: editor@calbrokermag.com

ART DIRECTOR/PRODUCTION MANAGER Steve Zdroik

Six Things Your Clients Need In a Dental Benefits Company by James Bramson, D.D.S., A dental benefit company that has the right internal processes can make all the difference in a member’s experience.

NOVEMBER 2016 PUBLISHER Ric Madden email: publisher@calbrokermag.com

DENTAL

LONG-TERM CARE

Rethinking the Approach of LongTerm Care Insurance with Clients by Steve Cain Why the traditional approach to LTCi sales isn’t working.

Guest Editorial..........................6 Annuity Sampler......................8 New Products....................... 24

News........................................ 43 Classified Advertising........ 46 Ad Index.................................. 46

NOVEMBER 2016

2 3

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GUEST EDITORIAL

TRUMP’S DEBATE CLAIM ON HEALTH CARE COSTS:

It Depends What You Mean By Cost D

onald Trump and Democratic presidential nominee Hillary Clinton debated over health care, among other topics, in a town hall format at Washington University on Oct. 9 in St. Louis. Health care finally came up as an issue in the second presidential debate in St. Louis Sunday night. But the discussion may have confused more than clarified the issue for many voters. During the brief exchange about the potential fate of the Affordable Care Act, Republican Donald Trump said this, “Obamacare is a disaster. You know it. We all know it. It’s going up at numbers that nobody’s ever seen worldwide. Nobody’s ever seen numbers like this for health care.” Let’s parse that discussion of costs piece by piece. Because when it comes to health care, there are many different types of costs: those for governments, employers and individuals. And those costs don’t always go up and down at the same time. First, the federal government’s spending on the Affordable Care Act’s insurance is coming in under budget projections. According to the official scorekeeper, the Congressional Budget Office (CBO), in March, the net cost of the insurance coverage provisions of the law — including tax credits to subsidize some lower-income customers’ premiums and costs for adding people to Medicaid — “is lower by $157 billion, or 25 percent” than the estimate when the law was enacted in 2010. Much of that is because CBO originally estimated that large numbers of employers would stop providing insurance to workers and send them to the law’s online marketplaces, where many of them would get federal subsidies. That didn’t happen. Medicaid spending increased more than CBO projected, but that was more than offset by the lower spending on tax credits. What Trump was almost certainly referring to when he talked about costs 6 | CALIFORNIA BROKER

by JULIE ROVNER from Kaiser Health News

going up were reports of increases in premiums for the marketplace plans. Those are for people who don’t have employer coverage and don’t qualify for a public health plan, such as Medicare or Medicaid. About 18 million Americans use those marketplaces, or exchanges. And on average, premium prices in states that have announced their rates are going up next year at much higher rates than for the previous two years, although the final tallies won’t be known until all the rates

are released later this month. Charles Gaba, who crunches numbers for his blog, ACASignups.net, estimates a national average premium increase of around 25 percent. Earlier in the debate, Trump noted that under the law, “your health insurance and health care is going up by numbers that are astronomical, 68 percent, 59 percent, 71 percent.” And there are reports of very large increases like those, including in Oklahoma, where premiums in the individual market could rise anywhere from 58 to 96 percent. Even in California, which has what is generally considered a successful marketplace, rates are going up an average of 13.2 percent for next year. There are several reasons for the increases. One is that insurers charged - CalBrokerMag.com -

premiums that were simply too low to begin with, and now they are catching up in order not to go broke. Another goes back to the CBO prediction above, about employers sending workers to the individual market to buy their own insurance. When that didn’t happen, insurers didn’t get the influx of generally healthier people to offset the costs of the sicker people who the law made eligible for coverage for the first time. A recent study from researchers at the Brookings Institution found that premiums in that market are actually lower than they would have been had the law not been passed. But even with premiums rising in many (though certainly not all) areas of the country, about half the people who buy insurance on the individual market won’t feel much of that increase. Tax credits will increase to cover most of the hikes for those who bought through the exchanges, and in many places consumers can save money by changing plans. Even with an estimated 25 percent premium increase, the federal government projects, 78 percent of marketplace consumers should be able to find a plan that costs $100 per month or less. Another estimated 2.5 million people are purchasing coverage on their own who could be getting tax credits. Meanwhile, the majority of Americans get coverage through an employer, and that market is seeing historically low premiums increases. A recent report from the Kaiser Family Foundation found family premiums for employer-coverage rose an average of 3 percent in 2016, continuing several years of much-lower-than-average hikes. H Julie Rovner, the Robin Toner Distinguished Fellow, joined KHN after 16 years as health policy correspondent for NPR. Kaiser Health News (www.khn. org) is an editorially independent project of the Kaiser Family Foundation. NOVEMBER 2016

ANNUITY SAMPLER

OCTOBER 1, 2016 Ratings Product Company Name Bests Fitch S&P (Qual./Non-Qual.)

Type SPDA Initial Guar. Bailout FPDA Interest Period Rate Surrender Charges

Mkt. Val. Min. (y/N) Contrib.

American Equity A- A- ICC13 MYGA (Guarantee 5) (Q/NQ) S 2.15%* 5 yr. None 9%, 8, 7, 6, 5, 0 Yes ICC13 MYGA (Guarantee 6) (Q/NQ) S 2.35%* 6 yr. None 9%, 8, 7, 6, 5, 4, 0 Yes ICC13 MYGA (Guarantee 7) (Q/NQ) S 2.50*% 7 yr. None 9%, 8, 7, 6, 5, 4, 3, 0 Yes

Comm. Street (May Vary)

$10,000 (Q) & 3.00%, age 0-75 & $10,000 (NQ) 2.10%, age 76-80** $10,000 (Q) & 3.00%, age 0-75 & $10,000 (NQ) 2.10% age 76-80** $10,000 (Q) & 3.00%, age 0-75 & $10,000 (NQ) 2.10%, age 76-80**

*Effective 8/5/16. Current interest rates are subject to change on new issues. **Commission may vary by issue age and state. See Commission Schedule for details

American General Life A A+ A+ American Pathway S 1.80%*a 5 yr. None 8%, 8, 8, 7, 6, 5, 4, 3, 2, 1, 0 Yes $10,000 (Q &NQ) 1.5% age 0-75 Insurance Companies Solutions MYG 2.00%*b .75% age 76-85 *CA Rates Effective 8/15/16. First year rate includes 1.50% interest bonus. a (less than $100K) ; b (100K or more) (*Guarantee Return of Premium) (Q/NQ) American General Life A A+ A+ American Pathway S Insurance Companies Fixed 5 Annuity

1.00%*a 5 yr. 1.15%*b

None

9%, 8%, 7%, 6%, 5%, 0% No $5,000 (NQ) 2.00% age 0-85 $2,000 (Q) 1.00% age 86-90

*CA Rates Effective 8/15/16. Includes 2.00% 1st year bonus, 1.00% base rate subsequent years. a (less than $100K) b (100K or more)

(*Guarantee Return of Premium) (Q/NQ) American General Life A A+ A+ American Pathway Insurance Companies Fixed 7 Annuity

1.45%*a 7 yrs. 1.65%*b

None

9%, 8%, 7%, 6%, 5%, 4%, 2%, 0% No

$5,000 (NQ) 3.00% age 0-85

1.50% age 86-90 *(Guarantee return of premium Q/NQ) *CA Rates Effective 7/18/16. First year rate includes 4.0% bonus 1st year. a (less than $100K) b (100K or more)

Great American Life A A+ A+ SecureGain 5 (Q/NQ) S 1.85% 5 yrs. N/A 9%, 8, 7, 6, 5 Yes $10,000 Effective 7/21/16. Includes .25% first-year bonus and is for purchase payments over $100,000. Escalating five-year yield is 1.85%. For under $100,000 first-year rate is 1.70%. Escalating rate five-year yield 1.70%.

2.50% 18-80 (Q), 0-80 (NQ) 1.50% 81-89 (Q&NQ)

Great American Life A A+ A+ SecureGain 7 (Q/NQ) S 2.15% 7 yrs. N/A 9%, 8, 7, 6, 5, 4, 3 Yes $10,000 Effective 7/21/16. Includes 1.00% first-year bonus and is for purchase payments over $100,000. Escalating seven-year yield is 2.04%. For under $100,000 first-year rate is 2.05%. Escalating rate seven-year yield 1.94%. Great American Life A A+ A+ Secure American (Q/NQ) S 1.25%* 1 yr. N/A 9%, 8, 7, 6, 5, 4, 3 No $10,000

3.50% 18-80 (Q), 0-80 (NQ) 1.50% 81-85 (Q&NQ)

*Effective 7/21/16. Eff. yield is 2.27% based on 1.25% first year rate, 1.00% available portion of 10% annuitization bonus (available starting in contract year two) and 0.02% interest on available portion of bonus at the rate of 1.25%. Surrender value interest rate 1.25%. Accepts additional purchase payments in first three contract years. COM12255

5.75% 0-70 4.65% 71-80 4.40% 81-89

The Lincoln Insurance Company

A+ AA AA MYGuarantee Plus 5 S 1.00%*a 5 yr. None 7%, 7, 6, 5, 4, 0 Yes $10,000 (Q/NQ) 1.15%*b *Rates Effective 7/8/16 (a–for premiums less than $100K, b–for premiums $100K or more), and are subject to change

The Lincoln Insurance Company

A+ AA AA MYGuarantee Plus 6 1.25%*b

The Lincoln Insurance Company

A+ AA AA MYGuarantee Plus 7 1.40%*b

1.10%*a 6 yr.

None

7%, 7, 6, 5, 4, 0

Yes

$10,000 (Q/NQ)

*Rates Effective 7/8/16 (a–for premiums less than $100K, b–for premiums $100K or more), and are subject to change

1.25%*a 7 yr.

None

7%, 7, 6, 5, 4, 3, 2, 0

Yes

$10,000 (Q/NQ)

*Rates Effective 7/8/16 (a–for premiums less than $100K, b–for premiums $100K or more), and are subject to change

The Lincoln A+ AA AA MYGuarantee Plus 8 S Insurance Company

1.25%*a 8 yr. 1.40%*b

North American Co. A+ AA- A+ Gaurantee Choice (Q/NQ) S for Life and Health

2.00%*a 5 yr. None 10, 10, 9, 9, 8 Yes $2,000 (Q) 2.00% (0-80) 2.25*b $10,000 (NQ) 1.50% (81-85) *CA rates effective 9/1/16 – a (less than $200K) b(200K or more) 1.00% (86-90)

Reliance Standard

3.25%* 1 yr.

A+

A Eleos-MVA

None

7%, 7, 6, 5, 4, 0

Yes

$10,000 (Q/NQ)

*Rates Effective 7/8/16 (a–for premiums less than $100K, b–for premiums $100K or more), and are subject to change

8%, 7, 6, 5, 4

Yes

$10,000

3.25%**

*Effective 2/13/16. Includes 1.50% 1st yr. bonus. Min. guarantee is 1.00%. **Reduced 20% ages 76-80, and 40% ages 81-85

Reliance Standard

A+

A Apollo MVA (Q/NQ)

4.05%* 1 yr.

None

9%, 8, 7, 6, 5, 4, 2

Yes

$5,000

4.00% to age 75**

Includes 2.00% 1st yr. bonus. Min. guarantee 1.00% **Reduced 20%, ages 76-80, and 40% ages 81-85. Effective 7/19/16

Symetra Life, Inc.

A A

A Custom 7 (Q/NQ)

2.50%* 7 yrs.

N/A

8%, 8, 7, 7, 6, 5, 4, 0

$10,000

Varies

*Effective 9/13/16. 2.00% base rate with no guaranteed return of purchase payments. Plus 0.50% bonus for $250,000 and above.

8 | CALIFORNIA BROKER

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NOVEMBER 2016

Joinin Us OCTOBER 2-4, 2017

HELD at LOS ANGELES CONVENTION CENTER

DENTAL

Six Things Your Clients Need In a Dental Company by JAMES BRAMSON, D.D.S.

n today’s health care industry, employers and benefit administrators are being asked to do more with less without sacrificing the quality of care provided to employees. It isn’t enough for a dental insurer to offer competitive prices and a large network of dentists. Your clients also need a company that’s easy to do business with and has the products, tools, and technologies to deliver efficient service. And while medical coverage is widely considered an essential benefit, some employers are foregoing dental coverage to keep costs down. These employers may not understand that health insurance solutions are incomplete without dental, and the right dental benefit company can enhance the health coverage package. When you have multiple carrier options to offer your clients, here are some points to consider when selling a dental benefit company:

10 | CALIFORNIA BROKER

1. A STRONG FOCUS ON ORAL AND OVERALL WELLNESS It might seem trendy to tout wellness, but plenty of research shows that oral bacteria originating from gum disease can appear in other parts of the body. Dental benefit companies that understand this critical mouth-body connection will have a robust wellness program for their members, including an enhanced wellness product and innovative ways to connect with members to get them in the dentist’s chair. Affecting change begins with education. A dental insurer should have wellness-related information ready for your employees that looks at the health and well-being of the entire body—from choosing better, more nutritious foods to teaching kids proper brushing, flossing and rinsing habits that will last a lifetime. A focus on wellness through better oral care yields healthier employees and healthier bottom lines for employers.

- CalBrokerMag.com -

2. E NHANCED BENEFITS FOR CHRONICALLY ILL MEMBERS Germs from their mouth and inflammation from gum disease can inhibit treatment for people who have a chronic health condition, such as diabetes, heart disease or stroke. When an employer is deciding whether to include this enhanced benefit, ask them to think of their own employee population: One out of every two American adults aged 30 and over has periodontal disease, according to recent findings from the Centers for Disease Control and Prevention (CDC). And 50% of adults over 21 have a chronic health condition, according to the National Center for Chronic Disease Prevention and Health Promotion. The combination of chronic medical conditions and gum disease may lead to higher expenses. So what’s the good news? Once oral bacteria is reduced in a patient, the body can focus on dealing with the chronic condition instead of handling both at the same time. Treating the gum disease in these chronically ill patients can reduce medical costs and hospital visits, according to a study published in the American Journal of Preventive Medicine. This could also affect absenteeism since workers with chronic conditions miss an estimated 450 million additional days of work each year, resulting in $153 billion in lost productivity annually, according to Gallup Healthways’ Well Being Index. NOVEMBER 2016

DENTAL 3. M ETRICS THAT SHOW THE QUALITY OF THEIR PLANS Not long ago, the industry measured dental quality simply by how many members visited the dentist at least once a year. This didn’t tell employers much about how their workforce was benefiting from dental coverage. A growing trend is that business owners and benefit administrators are asking for more data from their dental insurer on how their employees are using and benefiting from their plans. They want to substantiate the value of purchasing group coverage. For example, when there are more regular exams and cleanings than there are fillings, it could mean lower costs for an employer and less out-of-pocket costs to the patients. Additionally, the money invested in dental benefits can often lead to later savings when costly dental problems are prevented or treated in time. When it comes to quality metrics, dental insurers need to be agile and focused on continually improving their products and services, especially for client renewals. 4. CUSTOMIZABLE DENTAL PLANS WITHOUT THE JARGON Versatile and customizable dental plans are in demand like never before. From an emphasis on value to an enhanced wellness offering, dental benefit companies should have a line of products with options that fit the employer’s needs. In this critical area, brokers can provide counsel and sell dental coverage to an employer who is on-the-fence. Medical coverage is always important, but good oral health can have a positive effect on employees. Even healthy workers can benefit from a brighter, whiter smile. Also, regular preventive care can keep costly problems at bay. What’s more, the products and coverage descriptions should be simple to un-

NOVEMBER 2016

derstand. Prophylaxis? Maxillofacial? Amalgam restorations? Employers and their employees should not need a degree in dentistry to understand benefits. 5. T ECHNOLOGY TO CONNECT AND PROTECT Innovative technology that’s behind the scenes, is what makes everything work at an insurance company – from upgraded computer systems and security to intuitive mobile and Web tools. In a world that’s moving faster than ever, member tools must be easy to use, and patient data should be accessible to the subscriber from anywhere. Ideally, dental benefit companies want members to be able to get answers online and have access information without being placed on hold. It is beyond critical for a dental benefit company to take every possible step to ensure that customer data is secure. Data breaches not only cost the company hundreds of millions of dollars, but can also affect the member for the rest of their life. Peace of mind doesn’t always have a price, but consider mentioning to a prospective client how their benefit company ensures the utmost privacy and security for members.

efit company that has the right internal processes can make all the difference in a member’s experience. When deciding on dental coverage for employees, it’s important to look at how the prospective company’s customer service is performing and whether members regularly have a positive experience. Employers want to hear that a prospective insurer keeps members happy, which will maintain their employees’ satisfaction with the benefit package. H Dr. James Bramson is chief dental officer at United Concordia, a dental solutions company that administers benefits for nearly 7.4 million people nationwide. In this role, he directs the professional relations department, product development efforts, professional quality assurance activities, utilization review and claims review processes, and clinical aspects of the company. Dr. Bramson has 35 years of dental industry experience, including national experience as executive director of the American Dental Association (ADA).

6. EASY TO DO BUSINESS WITH Too often, consumers are dissatisfied with health insurers because of customer service. A member who visits the dentist for treatment should not experience a headache later on when dealing with the claim. A dental ben-

- CalBrokerMag.com -

CALIFORNIA BROKER | 11

MEDICARE

PART D SPECIAL:

Election Period Triggers Little Windows of Opportunity by ROXANNE ANDERSON

magine this. A flustered prospect calls you on January 7. In a voice laced with frustration, he explains that one of his friends referred him to you. He’s not happy with his prescription drug coverage and wants to change plans. It’s your first time talking to this potential client. Your conversation could be the stepping stone to a multitude of sales. Will you tell him you want to help, but the annual-enrollment period ended last month or you will see what you can do? As the annual-enrollment period comes to a close, it’s important to remember special-election periods and the invaluable opportunities to help others while growing your business. Many factors can qualify your client for a special-election period to change health and drug coverage. Let’s take a closer look at a few of the triggers. RECEIVING EXTRA HELP Extra Help is a Medicare program that helps qualifying individuals with low incomes and limited resources pay their Part D costs. Your client can get Extra Help through application or automatic enrollment based on being eligible for Medicaid, a Medicare-savings program, or supplemental security income. If your client has automatic enrollment, he has a special-election period to enroll in, drop, or switch Medicare Advantage or Part D plans. It starts the month he’s able to join Medicaid or a Medicaresavings program. This special-election period allows him to switch his health or drug plans once a month. 12 | CALIFORNIA BROKER

If your client is granted Extra Help, he has a special-election period to join, drop, or switch prescription drug plans or Medicare Advantage prescription drug plans. He can switch his drug coverage once a month as long as he continues to get Extra Help. If your client loses his eligibility for Extra Help, he has a one-time special-election period to drop or switch his Medicare Advantage or Part D plan. - CalBrokerMag.com -

ENROLLING IN A QUALIFIED STATE PHARMACEUTICAL ASSISTANCE PROGRAM Your client may be eligible for a state pharmaceutical assistance program that offers prescription drug assistance to seniors with low incomes. If your client qualifies, he has one specialelection period a year. At any time, he can use the special-election period to enroll in a Medicare Advantage or Part D plan for the first time or to switch NOVEMBER 2016

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*Fortune. Baby Boomers slowly growing more comfortable with retirement February 2015.

We’ve been selling Medicare Supplement insurance since Medicare began in 1966. For 40 consecutive years, UA has earned the A+ (Superior) Financial Strength Rating from A.M. Best Company (as of 6/16). Renewals paid for the life of the business, and are limited to 6th policy year on Guaranteed Issue Medicare Advantage Replacements; not applicable in NY or WA. Assumes no lapse in policy.

MEDICARE Medicare Advantage or Part D plans, as long as he was not automatically enrolled in a Part D plan by his state pharmaceutical assistance program. Losing eligibility for the state pharmaceutical assistance program gives your client a special-election period to join or switch to a different Part D or Medicare Advantage prescription drug plan even if he did not have Part D coverage. This special-election period begins the month your client was notified of his loss of eligibility for the state pharmaceutical assistance program or when he loses his state pharmaceutical assistance program eligibility, whichever happens first, and ends two months after whichever happens second. MEDICARE’S PACE PROGRAM The Program of All-Inclusive Care for the Elderly (PACE) is a government program that helps get qualifying members coordinated care in their homes and communities. It offers coverage for doctor/hospital visits and prescription drugs, among other services. If your client qualifies for this program, he has a special-election period to drop his Medicare Advantage or Part D plan to join PACE at any time. If he disenrolls from PACE, he has a special-election period to enroll in a Medicare Advantage or Part D plan that ends two months after his disenrollment is effective. NON-MEDICARE DRUG COVERAGE Your client may be able to get coverage from a non-Medicare source. If so, he could have a special-election period to change his health or drug plan. What if your client is eligible for or wants to maintain creditable drug coverage through the VA, TRICARE, or a state pharmaceutical assistance program? He has a special-election period to drop his Medicare Advantage prescription drug or prescription-drug plan and stay or enroll in one of those programs. Additionally, your client has a specialelection period if he wants to join or drop his employer/union-sponsored health and/or drug coverage, whether or not it’s considered creditable. If your client drops his employee/ retiree coverage, he has a specialelection period to join or switch Medicare Advantage or Part D plans. This special-election period lasts until two 14 | CALIFORNIA BROKER

months after the month his former coverage ends. Conversely, if your client wants to enroll in his employee/ retiree coverage, he has a specialelection period to drop his Medicare Advantage or Part D plan and join his employee/retiree plan upon becoming eligible for it. TURNING 65 WHILE ALREADY ON MEDICARE If your client is already on Medicare because of a disability and is turning 65, he qualifies for a special-election period to change his health and/or drug coverage. He also qualifies for a new Part D initial-enrollment period. Both of these enrollment periods start three months before the month he turns 65 and last three months after his birth month. With this special-election period, your client can drop his Medicare Advantage or Medicare Advantage prescription drug plan to switch to original Medicare or a Medicare Advantage plan without prescription drug coverage. He can then use the initialenrollment period to join a prescription-drug plan. WANTING TO ENROLL IN A FIVE-STAR PLAN Every fall, CMS rates plans for the upcoming year based on their overall performance. What if the annual-enrollment period has passed, but your client wants to join a Medicare Advantage or Part D plan that’s rated five out of five stars for next year? He has a specialelection period to join that plan from December 8 of the year that the rating was released through November 30 of the following year. He can only use this special-election period once a year. BEING ENROLLED IN AN UNDERPERFORMING PLAN What if your client has been enrolled in a Medicare Advantage or Part D plan that got less than three out of five stars for three consecutive years? He has a special-election period to switch to a plan that’s rated three out of five stars or higher. This special-election period begins when your client gets notice of the situation from CMS in the fall and continues through the upcoming year. Your client must call 1-800-MEDICARE directly to use it. - CalBrokerMag.com -

MEDICARE PART B RELATED EVENTS Does your client have to pay a premium for his Medicare Part A coverage? Did he or will he enroll in Part B during the Medicare general enrollment period, which runs from January 1 through March 31? If so, your client has a special-election period to enroll in a Part D plan from April 1 to June 30. Did your client have Parts A and B, but lose Part B coverage and his Medicare Advantage plan? If so, he has a two-month special-election period to enroll in a Part D plan, which starts when he learned that he lost his Part B coverage. GOING THROUGH OTHER QUALIFYING EVENTS There are still more ways that your client could qualify for a special-election period to change his prescription drug coverage. To name a few, he could qualify if he’s eligible for a special needs plan, disenrolls from his first Medicare Advantage plan, or drops his Medicare Advantage plan during the Medicare Advantage disenrollment period. What’s more, if your client experiences an exceptional circumstance that he believes should allow him a special-election period, he has the right to ask CMS for one. In short, don’t turn away prospects or clients who want to change their coverage after the annual-enrollment period. Remember to ask questions and determine if they’re eligible for a special-election period. These little windows of opportunity not only offer you the chance to make money during lock-in, but they can also help you expand your client base and build your reputation as a knowledgeable, trustworthy consultant. H Roxanne Anderson is a copywriter at Ritter Insurance Marketing. She got her B.A. in English from Elizabethtown College. Ritter is a national field marketing organization. An industry leader in technology, Ritter offers agents state-of-the art tools, including its Medicare Quote Engine; a lead-generating CMS-accepted permissionto-contact website, Medicareful.com; and an award-winning educational website and forum, TheAgentSurvivalGuide.com. For more information, visit RitterIM.com. NOVEMBER 2016

Overcoming the Fear of Selling Medicare Plans

MEDICARE

by COLLEEN M. GIMBEL

n my seven years of working in the Medicare arena, I have heard so many agents say they wanted to sell Medicare plans, but were afraid of all the rules. This got me thinking about what fear really means. According to Webster, there are numerous definitions of the word fear. Here are just a few: “An unpleasant emotion caused by the belief that someone or something is dangerous, or likely to cause pain or a threat.” “A mixed feeling of dread and reverence.” “The likelihood of something unwelcome happening.” Once, I even heard that fear was an acronym for false evidence appearing real. Obviously, based on the actual definition, it’s unlikely anyone would be afraid of adding Medicare products to NOVEMBER 2016

“Fear…an unpleasant emotion caused by the belief that someone or something is dangerous, or likely to cause pain or a threat…a mixed feeling of dread and reverence…the likelihood of something unwelcome happening.” their portfolio. I mean, we are insurance agents. What could be so scary? That’s the million-dollar question. If we could figure out what kept people from - CalBrokerMag.com -

doing things that would benefit them, we’d all be rich and famous. The objective of this article is to identify common reasons agents don’t sell Medicare plans and provide evidence to motivate you to get on the Medicare bandwagon (if you’re not already on it). As a vice president of recruitment, I hear a lot of reasons agents don’t, won’t or can’t sell Medicare plans. The most common reason I hear is “I have no time,” which is most often combined with “I have to focus on my current business.” That makes sense, right? You’re busy; and as an independent agent you may be handling every part of your business by yourself. Here’s the reality – you’re always going to be busy. It’s like those 30-somethings who say, “We’re too busy to have kids CALIFORNIA BROKER | 15

MEDICARE right now. We’ll do it when things settle down.” Then, next thing you know, they’re 40-something and wondering where the last decade went. If you have kids, you know it was worth every second of time you invested. Wait, did I just equate selling Medicare plans to having children? Yup, I did. Before you think I’m crazy, stay with me. Your business is like your baby. For it to grow and prosper, you have to love it, nurture it, provide it education, spend money on it and give it your attention. As a parent, we would do anything for our child. So why don’t we do the same for our business? It pays our bills, supports us, creates opportunity for us, and so much more. Literally tens of thousands of people are turning 65 every single day; and many of them may already be your clients. Remember, you don’t have to jump-in-the-deep-end of the Medicare pool. Start slowly, stay in the shallow end for a bit; and get used to the water by perhaps just adding one contract. Often agents believe that they have to add all carriers at once and that is not the case. Choosing the right carrier is something a good broker can help you with, so there’s no need to procrastinate any more. What else holds agents back from Medicare? Can you say rules and regulations? Granted there is no getting around the government rules and regulations of this business. I’ll let you in on a little secret though; it’s nowhere near as bad as people make it out to be. In fact, I sometimes wonder if agents who are in the Medicare space say that to keep others out of the business. You already work in insurance and already have mastered the regulations of your current business. Medicare rules are in place to protect the members from being taken advantage of so it’s easy to understand why we need them. To ease your mind about the rules, here is a basic look at what you cannot do in Medicare sales. You cannot cold call, randomly email someone you don’t know, or go door-to-door to solicit new business. Who wants to do that anyway? You cannot do an appointment for Medicare at the same time as a non-health related product. That’s no big deal. You cannot accept or offer gifts or financial incentives as a way to 16 | CALIFORNIA BROKER

enroll a client in a particular plan. That might work in opening a bank account, but in insurance would you really want to give away a toaster with every new plan? Probably not. You cannot discriminate or disparage competitors or original Medicare. Taking the high road is always the best idea. Those are the basics. Of course, there are ethics involved as well; you cannot enroll someone in a plan that isn’t in the client’s best interest. Everyone knows agents who work this way don’t prosper for long. Are you starting to wonder if your fears about selling Medicare are real? Oh wait, there’s one more reason preventing you from growing your Medicare business. You have to certify to sell the products each year. It’s true

"It takes practice to get good at something and I guarantee that taking (Medicare) certifications gets easier and faster every year." that no one likes doing certifications. It’s sort of like doing your taxes. No one wants to; it’s just a part of doing business. You may have even heard horror stories of it taking weeks of your time to certify. For the record, this is a bit of an exaggeration. The first time you take Medicare certifications, it typically takes more time because you are not used to the systems, the questions, etc. That’s like anything you do for the first time. If you want to run a 5K, it’s going to take you a lot longer the first time than it will the fifth time. It takes practice to get good at something and I guarantee that taking certifications gets easier and faster every year. The last fear I want to address is for agents who are selling Medicare supplement plans, but have chosen not to offer their clients Medicare Advantage or Prescription Drug plans. Many of these agents think Medicare Advantage is going away. This is a fallacy that could be keeping you from a very - CalBrokerMag.com -

important segment of our population. In 2026, it is estimated that 76 million people will be on Medicare and 40 million of those will be on Medicare Advantage plans. That’s almost 53% of the Medicare population that you will not be able to assist. Food for thought. As human beings, we have a tendency to put off things we don’t understand or perhaps we even suffer from unsubstantiated fears. The reality is, in the next 10 years, the number of Medicare eligible clients is going to grow by 24 million. Read that again, in the next 10 years we will go from 56 million to 76 million people on Medicare. And they will need your help. Medicare eligibles basically have three choices. 1. Original Medicare (Parts A & B) + a Prescription Drug Plan 2. O riginal Medicare (Parts A & B) + a Prescription Drug Plan + a Medicare Supplement 3. M edicare Advantage Plan With the exception of original Medicare, in all three scenarios, you as their agent can be involved in selling the Medicare plan. I say “can be involved” because you can choose not to offer all plans or worse choose not to swim in the Medicare pool at all. I want to leave you with a motivational quote on overcoming fear. Not surprisingly there are thousands to choose from so I settled on two similar ideas from two very different men. Plato was 80 years old when he died in 347 BC. He said, “We can easily forgive a child who is afraid of the dark; the real tragedy of life is when men are afraid of the light.” Franklin D. Roosevelt was only 63 when he passed in 1945. One of his most famous quotes is, “The only thing we have to fear is fear itself.” There are almost 2,300 years between the deaths of these two men who arguably changed our world forever. It is amazing we are still dealing with the same issue. Will you be the one who changes it? H Colleen M. Gimbel is vice president, Marketing/ Recruitment/Compliance for Berwick Insurance Group, L.L.C. Berwick Insurance Group, L.L.C. is a National Marketing Organization. As specialists in the Medicare industry, Berwick Insurance recruits and trains agents in all 50 states to sell Medicare products. For more information, call 888-745-2320. NOVEMBER 2016

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MEDICARE

EARNING AN INCOME WHILE HELPING THE VULNERABLE:

Brokers â&#x20AC;&#x201C; Champions of Dignity by HENRY FIGUEROA

e Medicare brokers navigate some of the most challenging sales dynamics in the industry. On one side, we learn compliant ways of marketing a health plan for segments of the population, which is no simple task. While usually market to a 65+ audience, a host of other circumstances make a person Medicare eligible. We encounter a wide variety of lifestyles and living circumstances that challenge our assumptions about people. We have an opportunity to earn a meaningful income while helping a vulnerable segment of the population. The Medicare broker has a unique purpose and opportunity in the world today: to be of special value to the public in the Medicare space and to dignify a segment of the population that is often lost and forgotten. What a powerful way to make a living. 18 | CALIFORNIA BROKER

Daily, we brokers exhaust our mental energy navigating the complex, regulated, metric driven decision trees to arrive at an opportunity that should be of value to the consumer. We work to create positive outcomes on multiple levels. We are told how to do so, when we can and can't do an activity, and what we can and can't say. Only occasionally do we understand exactly why we can or can't do or say something. Do you remember the first time your good intentions crashed into the walls of compliance? You canâ&#x20AC;&#x2122;t hand out your business card. You must be asked for it; otherwise you are soliciting. Most of us are simply trying to help people. For example, if I file a formal sales event within the proper guidelines, I can engage in certain behaviors, but not others. I can hand out a business card when I am asked for one, but I can't require a consumer to give their contact informa- CalBrokerMag.com -

tion even though they understand that I need it to follow up with them on the content in my presentation. Then there is the informal sales event, the educational event, and more. We have a real problem; some might call a systemic disease when you factor in the scale of rejection that sales people face and the pressure to grow revenue for a company so that we can keep opportunities alive for ourselves. The consumer becomes a commodity. We no longer market for the sake of engaging a person on a human level. We slice the pie and put people in a box so that we can extract, identify, and close one opportunity in order to get to the next one. We have made people an abstraction. We avoid deviating from a sales formula. There is one thing that we may fail to do during the myriad of human interactions occurring daily in our business NOVEMBER 2016

– coaching and engaging people with eye-to-eye contact and a sincere intention to truly help them. Take the person I am visiting for today’s appointment. He is incontinent, wearing an adult diaper. The smell in his home is less than desirable. The wear and tear of the furniture suggests that it has been in the same spot for 15 years or more. From the corner of my eye, I see an insect crawling and begin to feel that he needs more than my super-duper health plan, my new tablet computer, and my smile. This is an opportunity. His daughter asks me to help manage the costs of his medications while keeping four of his six doctors because they are his favorites. It’s only four out six because the other two aren’t contracted with the wonderful plan I’m offering him. Two minutes later, I learn about the service he has done for our country. Listening to stories about his work history, I learn that he has provided his family a wonderful life, not without its lumps. But it should at least earn him more than this circumstance we find him in. Star ratings and value propositions don’t directly honor these things about him. Only a broker can dignify him and his situation. What a profound concept. From this angle, the broker is a last line of defense between the human element and the machine. We can manifest dignity in a situation like this, and in the myriad of others we face each time we encounter the consumer population. A pragmatist would say that the sterile company metrics are simply a reality of business. Get the job done. What does dignity have to do with it? But my fellow brokers know that the question of dignity would arise if the pragmatist joined us on a complicated in-home appointment. The get-thejob-done attitude would be forced to journey through the caverns of this human experience. This same consumer, who might feel lowly about himself, can be reminded of his value rather than be left to feel commoditized and forced into a box. What if we say something like this every time during our inhome visits, "Mr. Jones, what a special person you are. I am proud to be here with you today, and you bring value to my life. There are a few things that I can work on that may be of benefit to NOVEMBER 2016

you. I want you, and your daughter, to have peace-of-mind today when I am working with you, and I care about how your healthcare is managed.” So come-on sales managers and higher-ups, let’s work together to preserve dignity in our sales culture. How can we challenge the limits of our metric driven machines? How can a concept like dignity affect sales growth? How do we quantify it? Dignity improves others’ experience of us, and therefore of our companies. After all we are still companies of people, right? Let’s take another glance at the conversation. Our industry deals with segments of the population that are often quantified without considering a person’s dignity. For example, in one hypothetical county, there are X number of Medicare eligible people. Of those 21% are over 65, and 19% have Medicaid or some form of state assistance. A marketing decision is made based on that data. For some people, the term “Medicaid” is pejorative. However, when I approach one of those 19 percenters, I’m almost immediately stunted before opening a conversation because the marketing decision that was made for this lead didn’t include data like the fact that, during their professional life, this person’s work helped lots of people. We have

this amazing story about a person. No one else in time and history has ever had a life exactly like the man sitting right in front of me. He has experienced love, hate, loss and gain, poverty, and wealth. And I am almost only approaching him today because of his poverty. I risk losing the transaction that I worked so creatively to secure if I don’t adapt my speech, my tone, my words, and my body language so that I dignify him. From what I have seen, some don’t dignify others. The prospect may say, “That broker couldn’t look me in the eye; didn’t make me feel comfortable; didn’t seem to care about me or my situation; didn’t ask about how I felt about the circumstances; and acted like he couldn’t stand to be near me.” Feedback about a dignified encounter goes something like this, “He was good to me, treated me with respect, and was courteous. I felt like he had my best interest in mind.” Can you relate? Shouldn’t we look a consumer in the eye and dignify them before pursuing a transaction? Isn’t bringing dignity to our people a good way to grow our business? H Henry Figueroa is regional vice president of Copeland Insurance Group in Orange County. He has been a sales professional for more than 14 years. Prior to Copeland, he worked in Medicare sales at United Healthcare, and life & annuity sales at Forward Strategies Insurance Brokerage.

Copeland Insurance Group is a full service, independent insurance agency with an agency portfolio that includes over 60 carriers that can help you find the best fit for your clients. Ranked the fastest growing Field Marketing Organization in the nation, we specialize in Medicare Supplements, Medicare Advantage, Part D plans and ancillary products. Contact us today and learn how you can jump start your Sales!

1221 E. Dyer Rd Santa Ana, CA 92705 www.copelandgroupusa.com Henry Figueroa, Regional Vice President Hfigueroa@copelandgroupusa.com

- CalBrokerMag.com -

CALIFORNIA BROKER | 19

HEALTH

The Evolution of Large Group & Its Opportunities by CHRIS PATTON t a time of the year when most people are heading to the garage to dust off the holiday decorations and settle in for time with friends and family, health insurance industry professionals across the country are getting ready for the long haul through fourth quarter and the next wave of ACA driven activity heading our way. We are now set to see the 51 to 100 employer segment transition to ACA compliant small group plans after many had opted for early renewal last year to put off the small group expansion implemented by the ACA. This 20 | CALIFORNIA BROKER

upcoming market disruption, although seemingly an inconvenience to our comfortable winter routines, presents unique opportunities for agents looking to capitalize on a new segment â&#x20AC;&#x201C; opportunities that can be found in the exchange marketplace. Based on 2014 California labor market employment data, roughly 2.3 million employees and 2.4% of all California businesses or 33,000 employers will be making the move to ACA compliant plans this winter. Needless to say, we are going to be busy. I donâ&#x20AC;&#x2122;t think I am alone in the fond remem- CalBrokerMag.com -

brance of spending the holidays with the family rather than hunkering down at the office to get group submissions buttoned up so coverage can begin on time and without issues. However, the upcoming shift in plans is not only going to require hard work and most likely long hours, but will also stress the necessity of agents understanding applicable new regulations. So, how did we find ourselves in this situation? When President Obama signed into law the Protecting Affordable Coverage for Employees (PACE) Act in October 7, 2015, the definition NOVEMBER 2016

HEALTH of “small employer” was essentially left up to each state’s discretion. California decided in 2012, when Assembly Bill 1083 was enacted, to expand the definition to include groups with up to 100 full-time equivalent employees. This legislation and the resulting changes represented a significant departure from the mid-market products and regulations that which groups with 51 to 100 employees were familiar. Much like the wacky aunt who gets a little too excited about the holiday punch, the new regulations, enacted in 2012 and implemented this year by AB 1083, do not come without challenges. For example, the new rating restrictions imposed impact groups in the 51 to 100 market differently than other segments. Prior to the small group expansion, groups had been rated based on health status or historical group claims experience, industry, group size, and to a degree gender. Now these groups are rated solely on individual age, rating region, and family size. Thus, some groups benefit from small group rates, while others may not. It is anticipated that groups with 51 to 100 FTEs generally fall into one of three categories: some will experience an increase; the goldilocks will see no change; and some will see a decrease in premiums. The elimination of composite ratings means that the expansion complicates pricing for many groups and packs a pretty good punch for older employees in groups that have a majority of young enrollees. Additionally, the upcoming transition to ACA compliant plans will act as a catalyst to changes in plan designs. Early feedback from groups that moved to ACA compliant plans last year was that plan designs falling within the four metallic tiers were not as rich on top tier and/or more expensive in the lower tiers. Benefit plans have compressed from both ends of the benefit spectrum, meeting in the middle as a response to steering clear of the Cadillac tax on rich plans and the addition of the 10 essential health benefits (EHBs) on the lower cost high deductible plans that were the base plans used for HSA or HRA benefit strategies. Although there will be some grumNOVEMBER 2016

bling over the pricing and plans, it is not all bad news. Groups in the midmarket have had their own set of challenges prior to expansion. Several features of the small group market that will now be offered to a wider audience may just represent welcome change for a segment of the newly eligible. One such feature is the resolution of the non-guaranteed issue dilemma. Groups with more than 50 FTE employees were not formerly subject to the protections of small group prod-

ucts with regard to guaranteed issue policies and rate stability. Depending on the employer’s claims experience, they could have seen extremely high premiums or no offer of coverage at all. Now, the expansion of small group has extended rate stability and guaranteed issue to groups with up to 100 FTE employees. An additional opportunity for employers in this market is an answer to what I called the “carrier conundrum.” Groups with 50 employees or more often offered health benefits to their employees that featured more than one carrier. However, meeting participation requirements held by these carriers, especially those under the PPO model, would often require a level of participation of 50% or higher. Depending on the region, this often led to problems renewing when lower, non-PPO rates were more attractive to employees, shifting participation away from the PPO carrier, jeopardizing the group’s eligibility. - CalBrokerMag.com -

The solution to this and the many other challenges is found in private or public health insurance exchanges. Exchanges bring some new alternatives to the table that the mid-market did not historically have available to them. Let’s look at a few of the benefits found in the exchange marketplace. First, exchanges offer a multi-carrier, multi-plan offering with no participation requirements among the participating health plans. This is the fix for the carrier conundrum. No longer will your groups yearn for a plan that will let the CEO take a PPO plan and everyone else take an HMO from another carrier. Second, the exchange market provides a true defined contribution. Although it is not the panacea for composite rates, it will allow the employer to set a fixed budget that will represent a predictable cost when employees and dependents are added to the plan. Yes, employees will see different rates based on their age, but they will also have the ability to choose from several carriers, multiple tiers and a myriad of different plans. Employee choice can be a powerful replacement for composite rates. Finally, there is guaranteed issue and rate stability for these new “small groups” through exchanges as pooled rates soften claims experience and their impact on renewals. Just like many of the opportunities created by past legislation, ACA regulations have created a niche market that will require special handling to avoid potentially harsh penalties associated with non-compliance. This quarter offers yet another opportunity to penetrate a largely untapped market for the agent who understands the special needs of the mid-market and can guide them through the ACA transition. H Chris Patton has more than 15+ years of industry experience in the California market with knowledge of the retail and wholesale distribution of group health insurance products. As the vice president of Sales for Covered California for Small Business, Chris and his team are staffed statewide to support the role of Covered California’s certified insurance agent community and to ensure the successful and ongoing distribution of California’s small business public exchange program. CALIFORNIA BROKER | 21

HEALTH

SMALL GROUP VIEW FROM THE TOP

n this article, health insurance experts give their take on the smallgroup market.

WHAT ARE THE TOP TRENDS IN THE SMALL GROUP HEALTH MARKET? Alan Katz of the Alan Katz Group: We're seeing a new equilibrium for the two-to-50 segment of the small group market. A lot of the unknowns that dominated the market as the ACA was implemented in 2014 and 2015 have been answered. Carriers, clients, and brokers seem to be adapting to the new reality. The new equilibrium may not be pleasant, and can certainly be frustrating, but it should be more stable. That stability is probably a year or two away for groups of 51 to 100 as those companies adapt to being considered small groups. Another trend that appears to be stabilizing relates to concerns over small companies dropping coverage and moving their employees to the individual market. If an employer was going to stop providing health insurance benefits, they probably would have done so by now. Michael Lujan, co-founder and chief strategy officer for Limelight Health: As small group premiums continue to increase (still outpacing inflation), everyday workers will shoulder more of the rising health care costs and premiums. About a quarter of employers offer a high-deductible plan. Another 40% are expected to migrate to only offer high deductible plans over the next three years. This trend will drive more demand for consumer transparency tools to help estimate the costs of prescription drugs and other healthcare services. The supplemental, worksite, and voluntary benefit market will also thrive to help back-fill the gaps left by these Silverand Bronze-level plans. Ninety-six percent of U.S. busi22 | CALIFORNIA BROKER

by LEILA MORRIS

nesses are small groups, which are the prime target for innovators who want to deliver a better shopping and consumer experience. As small group benefit designs are now standardized, more carriers and brokers will use new online and mobile tools to differentiate and win small business by providing a better experience. More than one in three U.S. workers are millennials (18 to 34 year olds). They influence or make their small group benefits buying decisions. Paperless enrollment, telemedicine, and non-traditional benefits are what they expect. Rob Carnaroli, Vice President of Sales for Sutter Health Plus: While the small group definition recently expanded to include employers with up to 100 full-time equivalent employees, some smaller businesses have steadily started to decline offering group coverage. We continue to see more employers offering high-deductible health plans (HDHP) plans; not necessarily HSA compatible, but simply offering deductibles that are higher than $1,000. Some smaller businesses are considering or implementing health care allowances to let employees shop for individual coverage themselves or even eliminating spousal benefits. Xavier Serrano, vice president, employ ee benefits at CBIZ: Narrow networks have been on the rise since last year. People have realized that, if you are only watching the same five channels, it makes no sense to pay for the other 500. As a result, rates have been somewhat flat with an average increase of about 6%. High deductible health plans continue to be popular, particularly in the young male health - CalBrokerMag.com -

population. It's about people realizing how to finance their risk properly. For the past couple years, another trend from the carrier perspective involves higher deductibles and out-of-pocket maximums – even on HMO’s, which we have never seen before. One way that employers are embracing these new high maximums is through voluntary benefits. Companies are realizing that they need to find new ways to help employees cover the increasing out-of-pocket maximums for emergencies. DO YOU SEE MORE GROUPS GOING TO COVERED CALIFORNIA’S SHOP EXCHANGE? Michael Lujan, Limelight Health: As a founding executive at Covered California and first director of SHOP (now called Covered California for Small Business), I may have a unique perspective and genuine desire to see SHOP succeed. California's small group market is robust and has great competition compared to other states. We also have CaliforniaChoice, a private exchange model most state exchanges aspire to be. Now with new private exchange models, like Fidelity's Marketplace, these private exchanges provide formidable competition in an already competitive market segment. Enrollment in Covered California for Small Business has been modest so far. They have a great opportunity to leverage their own unique value proposition and differentiate by offering unique products or flexibility of plan options that are not available in the off-exchange market. SHOP can also grow by solving the family glitch by promoting self-only enrollment for employees, which allows dependents to enroll on the individual exchange and even qualify for subsidies (APTC). SHOP enrollment is likely to grow steadily in 2017 as it finds a market NOVEMBER 2016

When it comes to group health plans, now you can balance choices with savings. Are your current rates increasing? Choice Simplified offers businesses a portfolio of plans that help your employeesÂ select the product, price and network that works best for them. And with some of the most competitive rates in California, choice and savings go hand in hand.

Based on comparison of other UnitedHealthcare plans within the Choice Simplified portfolio. Learn more at uhc.com/compareCA. ÂŠ2016 United HealthCare Services, Inc. Insurance coverage provided by or through UnitedHealthcare Insurance Company or its affiliates. Health Plan coverage provided by or through UnitedHealthcare of California. Administrative services are provided by United HealthCare Services, Inc. and its affiliates. MT-1037205 16-2369. 9/16

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HEALTH niche and way to differentiate itself. Alan Katz, Alan Katz Group: No. My guess is the SHOP will continue to struggle to build membership. If a small business qualifies for the federal tax credit, the SHOP may make sense. Otherwise, with approximately 28,000 insureds, the SHOP is probably approaching its maximum market share. California small businesses have a lot of choices. Absent the tax credits, the SHOP is just another option and one without a unique value proposition. Xavier Serrano, CBIZ: This has been a big trend this year. Employers and employees want options and by offering a fixed contribution, employers can offer the exchange model without breaking the bank. It doesn’t solve all the problems facing healthcare, but it does allow for employees to buy what they want and how they want it. Rob Carnaroli, Sutter Health Plus: The primary benefit for an employer to partner with an exchange is the ability to set a defined contribution amount that fits into its annual budget. It also allows them to give employees a true shopping experience with the ability to choose from a number of different carriers and metallic plan designs. From that standpoint, I believe the exchange concept continues to attract interest from small groups in California. While Covered California has made some significant improvements in its small business group platform, the majority of brokers and small businesses continue to turn to private exchanges for coverage. Private exchanges, such as CaliforniaChoice, have a proven depth of experience, demonstrated value in the marketplace, and garner a great deal of trust within the broker community. WHAT ARE SOME THINGS TO KEEP IN MIND WHEN SELLING TO AND SERVICING SMALL GROUP CLIENTS? Michael Lujan, Limelight Health: The role of the agent has never been more valuable. But the job now takes on new expectations from small business owners who still see agents as their outsourced benefits and HR department. First, no one wants to be 24 | CALIFORNIA BROKER

sold insurance. However, it is valuable if you provide a comprehensive solution for complying with the ACA, improving employee engagement, wellness, and you provide the tools to help on-board and enroll new hires. Companies like Zenefits, Gusto, and Namely have figured this out and meet the demand with technology and a solid business plan. Many brokers haven’t updated their business in years. Reevaluate your services and your service model, and listen to your clients. They will tell you exactly what they want. Xavier Serrano, CBIZ: For me, it’s all about being the ultimate consultant. This means listening to my client’s needs and finding creative ways to meet those needs. For example, a client of mine with about 80 employees recently went into age-banded rates for the first time. To alleviate the hardship of moving employees from composite rates and into paper-based applications, we combined our billing administration with the use of a technology platform to make the transition seamless to the employees and the administrator. Alan Katz, Alan Katz Group: Small business owners need brokers more than ever. They're making decisions not just for their own families, but also for those of their colleagues as well. They aren't health insurance experts; they know they need expertise to make the right decision. That’s why the vast majority of these business owners relay on professional brokers. This makes it imperative for brokers to remain worthy of that trust. They need to deliver expertise, and provide the tools and resources their clients need in today's world. They need to provide expertise and resources throughout the year, not just during renewals. Brokers who focus on their small group clients year-round and deliver meaningful value will thrive in the years ahead. Rob Carnaroli, Sutter Health Plus: The Patient Protection and Affordable Care Act (ACA) continues to be a complex issue for small groups, on top of ever changing federal and state business and health care laws. Small busi- CalBrokerMag.com -

nesses often don’t understand or can’t keep up with the laws—they continue to need trusted advisors to help navigate the health care regulations. A broker who can provide a detailed level of expertise in this arena is extremely valuable in not only retaining clients, but helping generate new opportunities in the market. In addition, small group clients want more from their insurance broker than just a proposal for one line of business or a one-time solution for financial issues. Whether this means simplifying employers’ responsibilities through innovative technology, supporting HR functions, or providing legal support through value-added services, the market demands that brokers come to the table with more solutions than ever before. H Leila Morris is senior editor of California Broker Magazine.a

NEW PRODUCTS MEDICARE BENEFITS ANALYZER Mark Farrah Associates released its 2017 Medicare Benefits Analyzer (MBA). Customers now have access to Medicare Advantage and PDP premiums, co-pays and benefits information for the upcoming 2017 calendar year. In addition to plan premiums and enrollment, the product includes comparisons on co-pays, prescription drug tier costs, and annual out-of-pocket costs. For more information, visit www.markfarrah.com. SMALL BUSINESS BENEFIT SOLUTIONS MetLife’s new Simply Smart Bundles provide brokers and small business owners employee benefits that enhance their ability to compete in their local markets. Designed for businesses with 10 to 99 employees, the Bundles product includes a combination of dental and vision insurance. There is also the opportunity to add on an employee-paid group legal services plan. This is the first time MetLife is making this benefit available to small businesses. There are also tiered local options. For more information, visit MetLife.com/SimplySmartBundles. H NOVEMBER 2016

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HSA

THE HARD Developing a JOB OF Successful ASKING SOFT QUESTIONS HSA Program BY VALERIE CLARK

ven with all the experience employers have developed offering high-deductible health plans linked to health savings accounts, it’s surprising how much opportunity still remains in this segment of the benefit market. But brokers and benefit advisors who guide their clients toward adoption of HSA-oriented strategies need to be patient and ready to do plenty of education. Most importantly, the professionals who help clients develop successful programs that link a high-deductible health plan with an HSA will be those who pay particularly close attention to the soft questions about company culture and communications. The owners and managers of small companies who represent today’s most attractive market may initially be drawn to high-deductible HSA plans by financial considerations, but the best advisors will help them understand the plans represent far more than a budgetary decision. The relatively easy business in the HSA and high-deductible health sector commonly adopted the plans years ago – the big employers with sophisticated benefit operations. That means that the largest opportunity today exists with smaller employers. A study by Kaiser Family Foundation 26 | CALIFORNIA BROKER

reveals that more than half of large employers (those with more than 1,000 employees) nationwide were offering a high-deductible plan with a savings option in 2015. In comparison, just a quarter of small employers (those with fewer than 199 employers) had rolled out an HDHP. The opportunity may be even greater in California, although the challenges are greater, too. A United Benefits Advisors study of data in 2014 found that only 11% of plans in California were high-deductible and only 8% of the workers in the state were enrolled in them. UBA said the market dominance of Kaiser in California, as well as a strong preference for HMOs in the state, may offset the rate relief offered by high-deductible programs. Thus, employers might not have given them a close look. But for many employers, the potential cost saving is only part of the appeal of high-deductible offerings. A bigger attraction is the way that high-deductible plans linked to an HSA encourage employees to take greater personal responsibility for their own spending on healthcare. In fact, as advisors sit down with small- and mid-sized employers, the question of motivation provides a great place to begin a conversation about culture and communication: - CalBrokerMag.com -

HSA The first question: Is your company mostly interested in an HSA-driven program because of the cost savings? Or are you primarily interested in building personal responsibility among workers? The differences between an employer’s cost for traditional health premiums and a high-deductible plan may be great or small, but can be calculated fairly easily. If the employer decides to make a contribution to employees’ healthsavings accounts — it’s not required, by the way — that contribution can be easily folded into the financial calculation as well. Commonly, companies convert at least a portion of the savings from reduced premium costs into contributions to employees’ healthsavings account. For many California employers, another financial benefit arises because employees’ pre-tax contributions into health-savings accounts reduce the threshold on which workers compensation premiums are calculated. While those financial calculations can be whipped up fairly easily, it’s more difficult to calculate the value of employees who are taking more personal responsibility for their own healthcare. It results in a subtle change in the relationship between the company and its employees. Some employers may see a benefit to all of society through the well-accepted findings that workers tend to use health care more carefully when the cost is coming out of their HSA. At the same time, a highly paternalistic organization may be uncomfortable with a more responsible workforce. Some employers even may be skeptical that their workers can be trusted to make their own decisions at all. The second question: How prepared is your workforce for a significant philosophical change in your company’s healthcare benefit? Some companies have done a good job keeping their workers informed about the costs of healthcare premiums and the effects of those costs on the overall business. Other companies have made a stab at explaining the increases in premium costs, but employees have heard the explanations as just another example of whining from the corner office. And a fair number of companies haven’t kept employees informed at all. NOVEMBER 2016

The amount of preparation makes a big difference. Employees who haven’t been educated are likely to see only the words high deductible when they’re introduced to a high-deductible plan linked to a health savings account. They’ll probably view the change as a significant take-back by their employer. That creates rotten morale, falling productivity, increased turnover, and problems in recruitment that can offset any gains for the employer. If the preparation of the workforce hasn’t been done, or if it’s been done badly, advisors might be smart to advise their clients put off adoption of a high-deductible HSA plan for a year to give time for the groundwork to be laid.

"Adoption of a new plan demands clear lines of responsibility for training and ongoing conversation with employees." The third question: What do your employees want? In some instances, employees may have learned about HSA offerings from friends or their spouse. If they’ve been asking for a similar program from their employer, the advisor’s work is easier. This question needs some deeper digging beyond employees’ stated preferences so that the advisor and broker can design the best possible plan. At a company with an older workforce an HSA can provide an excellent vehicle for additional retirement savings. In turn, the chance to save HSA dollars for an extra couple of years before retirement may slow the exodus of highskilled, difficult-to-replace workers. A younger workforce may be excited about wellness programs that often accompany high-deductible programs and help them control their own healthcare spending. Those elements of a plan can help with recruitment and retention. Age, salary, gender, family situation and time of service with the employer all will influence the way the plan is designed. The fourth question: Who would educate workers about their new highdeductible plan and their new healthsavings account? Firms, of course, - CalBrokerMag.com -

typically draw on their own resources to help clients introduce changes in benefit programs. That’s critically important with the shift to a high-deductible program because of the philosophical as well as financial considerations involved. But once the brokerage staff closes up its laptops and takes its PowerPoint presentation back to the office after the all-hands meeting with the client, who will answer employees’ questions during open enrollment, particularly if the company offers a high-deductible plan as one of several options for health coverage? Who will help employees project their annual spending on healthcare so that they can budget their contributions to their HSA? Who will teach employees the day-in, day-out process of using a debit card to draw money from an HSA to pay medical expenses? Especially in the first months after introduction of a high-deductible program, someone in the company will be spending significant amounts of time on employee questions (and probably will be on the phone often with the advisor). Adoption of a new plan demands clear lines of responsibility for training and ongoing conversation with employees. The questions may slow down after a while, but they always will arise. The best advisors will be those who can talk straight with their clients to ensure they are ready to meet this need. Advisors may find it hard to ask soft questions about culture, communication and corporate commitment. Advisors and their clients alike are accustomed to falling back to the easy, default conversation that puts the financial discussion first. But as firms tap into the abundant opportunities that remain in this sector, soft questions will be the ones that open the door to long-term success. H Valerie Clark is the President of Clark & Associates Insurance Services, an insurance brokerage firm specializing in the development of creative health insurance plans for employer groups of all sizes. She joined Clark and Associates in 1993. She is a partner in Solutions At Work, which helps companies provide high quality Human Resource Consulting Services, HRIS and Payroll Technology Solutions at a competitive price. CALIFORNIA BROKER | 27

HSA SELF-FUNDING

THE SELF-INSURANCE SOLUTION:

Exploring Self-Funded Plans In California’s HMO Country By PAUL JOHNSON

t’s open enrollment for the 2017 benefit year, and business owners nationwide are facing the same challenges that have plagued them for years. Insurance rates continue to sky28 | CALIFORNIA BROKER

rocket – even for companies with very low utilization – cutting deeply into the bottom line. Employers are forced to make a difficult choice: pay higher premiums year after year for traditional insurance plans – typically for less coverage – or offset premium increases - CalBrokerMag.com -

by cutting coverage, passing more of the costs to employees, or reducing their workforce. Given these dismal options, it is no surprise that business owners are feeling trapped. Regardless of the rise in insurance costs, the Affordable Care Act (ACA) requires many employers to provide healthcare. Other business NOVEMBER 2016

PRIVATE EXCHANGES SELF-FUNDING PRIVATE EXCHANGES HEALTHCARE owners, including those with fewer than 50 employees, may not be bound by the law, but know they must offer healthcare if they want to recruit and retain top talent. Brokers whose clients are rumbling about increases have the opportunity to offer an alternative: self-insurance. Simply stated, employers who selfinsure assume the claims risk of their staff. Combined with stop-loss insurance for catastrophic or chronic illnesses and accidents, self-insurance eliminates administrative costs of traditional health insurance and may cost considerably less than a major medical plan.

Given Kaiser Permanente’s foothold, self-insurance is underutilized in California, but it’s worth a closer look. In fact, it may be the silver bullet for companies struggling to maintain financial solvency amid annual insurance rate hikes. Even companies that offer Kaiser are sick of the high cost of healthcare, yet they feel trapped. Their brokers are in a tough spot: they can offer a different healthcare solution or risk losing the business to someone else. Self-insurance may be just the thing these clients want and need. Large corporations and government entities, nationwide, have used a self-insurance model for decades. The trend is just beginning to take hold with small- and mid-sized businesses, spurred by overwhelming cost increases, federal regulations, and a healthcare system that is difficult and daunting to navigate. REDUCING COSTS Companies that self-insure can meet all of the mandates of the ACA, avoid NOVEMBER 2016

the state premium tax, pay fewer ACA taxes and fees, and are not on the hook for carrier profit margins. Businesses can save even more by working with a third-party partner that helps employees navigate the healthcare system, and directs them to the right level of care and most cost-effective facilities. For example, many medical expenses are needlessly incurred in hospitals. MRIs, X-rays, blood tests, and other common procedures may cost five to 20 times more than the exact same services performed in an offside imaging center, lab, or independent doctor’s office. A partner organization can serve as a healthcare concierge, directing employees to seek treatment at lower-cost (but equally effective) sites of service. This is a key aspect of decreasing costs through self-insurance. MITIGATING WORKERS’ COMP Likewise, self-insuring may prove a smart solution for companies in industries with high workers’ compensation claims. Far too often, employees claim workers’ comp for very minor injuries that require only first aid – and workers’ comp is a high price to pay for a few stitches. In other cases, people claim workers’ comp for injuries sustained outside the workplace, simply because they don’t have other healthcare options. With a well-designed plan – combined with a clear process for guiding employees through the healthcare system – workers are more likely to seek the right care through the right channels, helping businesses keep workers’ comp claims in check. AN EDGE IN HIRING Self-insurance may also give companies a competitive advantage in hiring. While insurance premiums are killing business’ profitability, the cost of healthcare also is creating a hardship for individuals who don’t get benefits through their employer. Many of those people start looking for jobs with bigger companies that are required, by law, to offer healthcare, leaving small companies at a distinct disadvantage. However, self-insurance may be a good option for businesses of all sizes – even those with just a handful of employees – and may aid them in hiring. - CalBrokerMag.com -

STRATEGIC PLAN DESIGN Self-insurance might just be the best-kept secret in healthcare. A smart, strategic plan should include these three components:

1. Everyday care that most employees need: Many of

today’s traditional health insurance plans offer stripped-down benefits that do not cover routine health services. Other plans, including minimum essential care (MEC) coverage, are heavy on diagnostics and light on treatment – MEConly plans do not address employees’ ongoing medical needs. A smart partial self-insured plan should include primary and injury care, rehabilitation and chiropractic care, labs, immunizations, generic medications and preventive services at little or no out-of-pocket.

1. Stop-loss insurance: To

supplement the partially selfinsured plan, companies can purchase stop-loss insurance to cover the most expensive healthcare – chronic illnesses, catastrophic diagnoses or accidents – and to ensure the business meets Minimum Value Plan requirements.

2. Streamlined Care Delivery: Companies may

elect to hire a partner organization to manage the care delivery and logistics process, help employees navigate the system, and eliminate the waste, administration and overpricing rampant in today’s healthcare industry. H

Paul Johnson is CEO and co founder of Redirect Health. Redirect Health helps entrepreneurial businesses and their brokers build affordable healthcare plans using a self-insurance model. Brokers interested in exploring this solution may visit redirecthealth.com or call 888-995-4945. CALIFORNIA BROKER | 29

SELF-FUNDING HEALTHCARE

SELF-INSURANCE:

A Game Changer for Businesses and Advisors by RON E. PECK

ou walk into a doctor’s office and step up to the check-in window. The receptionist asks, "Do you have insurance?" Long ago, this question would have had a simple answer. Individuals whose employers provided health insurance could respond with a simple, "Yes. I have health insurance." This seemingly normal exchange hides many complicated arrangements and moving parts that, until now, were ignored by most people. But as the price of health care and health insurance skyrockets, employers and employees are digging deeper and asking, "What is health insurance? Is it all the same? Can we do something to save money but maintain benefits?" Health insurance generally comes in two flavors – self-funded and traditional fully funded insurance. Fully-funded insurance is the type of coverage most people are accustomed to from automobile to homeowners insurance. People are accustomed to having an agent assessing them and the risk they pose, then charging a premium to provide coverage. Enter self-funding. A self-funded health plan is established when an employer – the primary plan sponsor – sets aside some of its funds to pay for its employees’ medical expenses. Those workers contribute to the plan instead of paying premiums, although the similarity of the actions means that it’s not uncommon to hear employees and employers refer to such contributions as "premiums." 30 | CALIFORNIA BROKER

Here are some reasons why an employer would self-fund: PLAN CONTROL Self-funding begins with drafting a plan document or summary plan description. This is where the employer chooses what to cover and what to exclude. Within parameters set by federal law, the employer customizes the plan to be generous where their particular workforce needs it, and stingy where benefits aren’t needed. For example, if someone owns a yoga studio where the workforce is in tip-top shape, they can go lean on benefits meant to help those - CalBrokerMag.com -

who are suffering from morbid obesity. In addition to customizing the benefits, the employer can customize the partnerships. Fully funded carriers have selected their provider networks, vendors, and other programs that they package and force upon policy holders. A self-funding employer, however, can shop around and select partners to customize their team. INTEREST AND CASH FLOW When an employer purchases fully funded insurance, they pay premiums when they are told to pay. That money is gone. It sits in the carrier’s account NOVEMBER 2016

HEALTH PRIVATE EXCHANGES SELF-FUNDING until it’s needed to pay claims. While it sits, it’s working for the carrier. With self-funding, the funds are in the employer’s hands until they’re needed, meaning interest on those assets belongs to the employer. Likewise, the money is in hand and usable where needed, when needed. FEDERAL PREEMPTION AND LOWER TAXES In the United States, we are governed by federal and state laws. However, when you can’t comply with a state law without violating a federal law, the state law is moot and federal law preempts the state. The Employee Retirement Income Security Act of 1974 states that a private, self-funded health plan is administered in accordance with its terms and federal rules. As such, these plans are not subject to conflicting state health insurance regulations or benefit mandates. Likewise, such self-funded plans are also not subject to state health insurance premium taxes. DATA These days, everyone talks about big data, and leveraging data to predict future needs and expenses. A fully funded insurance carrier owns the claims data they receive and produce. Employers with self-funded plans can examine the claims data, study trends, allocate resources, and form partnerships to address their actual needs. SHARING IS NOT CARING A fully funded insurance carrier sets premiums based not only on what they anticipate you will cost them, but they also add a buffer to cover other employers’ employees to soften the pain of underestimating how much one of those other policyholders will cost. In other words, all policyholders are contributing toward their own expenses and the expenses of others. As such, the steps an employer takes to make their own population healthy don’t much impact the bottom line unless all other policyholder employers do the same thing. With self-funding, the employer pays only the claims of their own population, so steps taken to reduce the cost affect the employer’s bottom NOVEMBER 2016

line directly. Employees of self-funded companies generally have lower single and family premiums than those with fully funded insurance. Overall, these benefits result in net savings for the self-funded plan over a three- to five-year span, compared to a comparable fully funded insurance policy. Yet there are risks. Among them: the threat of catastrophic claims, inability to fund claims, and new fiduciary responsibilities to the members of the plan. Most self-funded health plans purchase stop-loss, a form of reinsurance that reimburses self-funded plans for claims they pay in excess of a specific deductible. This is hardly a sure thing. As claims paid by the plan exceed what the plan actually covers or are otherwise excluded, the stop-loss carrier won't reimburse the self-funded plan, leaving the employer holding the bag. Finally, a self-funded employer is a plan administrator or appoints one. That administrator is a fiduciary of the plan and its members. Applicable law dictates that the fiduciary must act prudently, protect the plan, and apply its terms judiciously. Failing to comply with these terms, mismanaging plan assets, or otherwise doing something that’s not in the plan’s best interest could expose the plan sponsor to claims of fiduciary breach, resulting in steep penalties. Fortunately, there are third-party organizations that will step in, aid in decision making and act as a fiduciary as it relates to those decisions. This indemnifies the self-funded plan administrator. Self-funding has its risks, but also presents numerous rewards. As the price of health care continues to increase, many employers who had been too risk-averse are second-guessing their decision and are self-funding. Although self-funding is an obvious choice for employers with more than 1,000 lives that can spread the risk among their employees, employers with 100 or fewer workers are at greater risk. If one catastrophic claim is submitted, and the company lacks the population or assets to absorb the hit, the results can be devastating. Yet my company, with fewer than 100 lives at the time, made the leap. Over the time we have been self- CalBrokerMag.com -

funding, our contributions dropped drastically from the premiums we had been paying by nearly 30% in two years. Since then, they haven't increased by more than a few percentage points annually and we have yet to submit a single stop-loss claim. Our ability to customize and control our plan certainly has helped. We've drafted terms into plan documents empowering participants to notify the plan administrator anytime a costly procedure is being sought. We also reward participants for collaborating with the plan sponsor to identify the most effective yet cost efficient options. Our health plan has already saved thousands of dollars this year, and awarded employees thousands in incentives. A plan member recently sought to obtain surgery with an anticipated fee of $60,000 for the facility, and another $10,000 for the surgeon. After research, we determined the fee was on the high end of the spectrum. We communicated with some area hospitals and found one facility that would take $20,000 cash up front for everything involved with the procedure being performed by the same surgeon. We saved more than 70%, and a portion of that saving was given to the participant as a reward. Self-funding isn’t for everyone. But for employers willing to get handson about their health care, the savings could be monumental – enough, in fact, to save the employer-based health benefits industry. Many employers who had purchased fully funded insurance are contemplating dropping their coverage, paying a penalty (per the Affordable Care Act), and allowing their employees to secure individual insurance on the exchanges. That cuts agents out of the mix, and they lose business. Agents who rely solely upon fully funded insurance, therefore risk losing many of their employer clients. Agents who educate themselves about selffunding and its benefits can steer their employer clients away from this scenario. Agents can use self-funding to keep their employer clients as clients, purchasers of insurance. H Ron E. Peck, Esq. is senior vice president and general counsel at The Phia Group, LLC. CALIFORNIA BROKER | 31

VOLUNTARY VOLUNTARY BENEFITS BENEFITS

VOLUNTARY TALENT MAGNET Attracting and Retaining Essential Employees with Voluntary Benefits

Closing the Global Talent Gap with Voluntary Benefits by WIL TROHANIS

ompanies not only in the U.S. – but around the world – are struggling to attract and retain talented employees. With mounting pressure on their bottom line, employers are constantly looking for new and innovative ways to engage employees and stretch benefits budgets to maximize the return on their (often significant) investment. Fifty-six percent of corporations in Russia, 47% in China, and 40% in Poland, India, the United Kingdom and the United Arab Emirates are concerned about talent shortages. Simultaneously, there is global concern over retention. At least one-third of employers in six of the countries surveyed feared being affected by a talent shortage, and there was strong evidence that they should be concerned. Employees were not shy to admit they would like to be working for another employer within a year, such as the 41% of managers/leaders/executives in the United Arab Emirates, according to global research from MetLife’s Employee Benefit Trends Studies. Mean-

32 | CALIFORNIA BROKER

while, employees around the globe are bringing their finance-driven anxiety to work, affecting productivity and engagement. The narrative is similar in the United States. Nearly 58% of employers are concerned about lack of skilled talent in the marketplace, and nearly 55% are concerned about addressing employees’ skill gaps. Whether it’s tight labor markets, the challenging global environment, a rising gig economy or any number of other contributing factors, the cause for concern over talent is real. In this global struggle, brokers must work with employers to understand what motivates employees to join and stay with their company—and while our studies show that salary tops the list, other employee benefits were ranked highly as well. With this in mind, brokers can help employers move toward a total rewards approach by working with them to offer employees a wider range of voluntary benefit options. Voluntary benefits have proven to be a win-win for employees, not only in the mature - CalBrokerMag.com -

U.S. market – but abroad as well. BENEFITS THAT BENEFIT ALL Brokers around the world can support employers’ goals to attract and retain talent by encouraging them to offer total rewards packages with the wide variety of voluntary benefits employees want. Nearly 50% of all employees surveyed globally indicated that they seek more voluntary benefits. Two countries are paying particularly close attention to the effect of voluntary benefit programs: Mexico and the United States. In Mexico, for example, corporations are focused on improving the range of voluntary health program offerings. In fact, 92% of companies said they would be interested or definitely interested in contracting with an outside provider to offer voluntary benefits. MetLife’s Regional Head of Employee Benefits in Latin America suggests companies’ interest stems from employees’ seeing and getting the most value from customizable programs. Similarly, in the United States, 55% of employees are interested in NOVEMBER 2016

VOLUNTARY VOLUNTARY BENEFITS BENEFITS having their employer provide a wider array of benefits that they can purchase and pay for on their own. In fact, 64% of U.S. employers offer a range of benefits that meet personal and household needs. More robust benefit options should result in a more satisfied workforce, and greater retention. Employees consider an improved benefits package one of the top three factors affecting their decision to stay with a company. For example, more than half of employees in China, United Kingdom, United Arab Emirates and India agree that an improved benefits package could persuade them to stay with their existing employer. And in the United States, 70% of employees agree that having benefits customized to meet their needs would increase loyalty to their employer. The good news is that this isn’t an uphill battle for brokers, as employers are seeing what employees are feeling. Sixty percent or more of employers in all but one country studied believe in the power of benefits to attract employees, followed by 75% that consider benefits key to retaining employees. In the United States, 83% of surveyed employers cited retention as one of their main objectives in offering benefits, with loyalty a close second at 76%. BROKERING TOTAL REWARDS CHANGE Offering voluntary benefits as part of a total rewards package is the first step brokers can take to help employers close the talent gap by finding and retaining loyal, dedicated employees. In addition, brokers have an opportunity to help corporations identify and implement other employee benefit solutions that can make them an employer of choice. Findings from the study validate the need for brokers to innovate on how they can help meet employer demand for administrative benefit support. For example, when employers were asked what they are looking for from brokers, 53% of employers were seeking insights about benefit trends, and 40% were looking for global benefit solutions. As brokers are discussing benefit options with their clients, here are three pieces of advice they can offer NOVEMBER 2016

their clients: • Understand financial and wellness concerns. Research shows that employees around the world are concerned about their financial situations, even more so than in the U.S. – and they expect their employers to step in and offer tangible support. The employers that do so will probably be rewarded. Globally, we found that 71% of employees listed that being no longer able to work because of disability or serious illness was a top financial concern, compared to 56% of U.S. employees. Other global top financial concerns included paying for children’s education and family’s financial security in the event of premature death. From a wellness perspective, stress was a top concern. The positive news is that the majority of employers said improving employee health and wellness was an important reason they offered benefits to their employees. Across the six markets surveyed — China, Egypt, India, Poland, Russia, and the UAE — 80% or more of employees who participated in these wellness programs indicated the programs had a positive effect on their health. In the U.S., more than half of employers say that offering well being programs to motivate employees’ healthy behavior is important. And it does appear to pay off with 71% of U.S. employees agreeing that because of the benefits they receive in the workplace, they worry less about unexpected health and financial issues. • Tailor product recommendations by country and need. It’s important to recommend benefit options that mirror employees’ needs, which will vary by region. For example, in the past three to four years, Australia has increased its focus on health and wellness countrywide, indicating that holistic wealth programs should be highlighted with total rewards programs. • Evaluate technology options. In order to maximize productivity and engagement, brokers can help employers evaluate appropriate technology tools to improve the employees’ benefit experience – for employees and administrators. According to - CalBrokerMag.com -

Thomsons Online Benefits , 52% of organizations do not have a centralized approach to technology and use different methods in each country. This underscores the need for brokers to understand and be proficient on benefit technology. New tools are emerging constantly, such as avatars to explain benefit options, and cloudbased global benefit administration and total rewards technology. Employers will often rely on their broker to help navigate the benefit technology world, in order to deliver the greatest effect, and accomplish the benefit goals for their business. • Communicate the effect of total rewards. Employers need help actively promoting the benefits they offer during recruitment and onboarding efforts. Communication between employers and employees about benefits is lacking, even though both groups are aligned on need and interest. For example, in the United States, a majority of employees understand how traditional benefits work, such as medical insurance (82%) and 401(k)s (78%), but fewer understand how less traditional benefits work, such as hospital indemnity insurance (39%). Further, employees don't enroll in non-medical benefits because their employer doesn't promote them (35%) or they were not aware that their employer offered medical and non-medical benefits packages (21%). This means that brokers can step in and help employers improve and activate benefit education. • Employees are motivated by and willing to pay for more robust and relevant options, so a key to engaging strong talent is abandoning a one size fits all approach to benefits. Brokers have an opportunity to help employers demonstrate that they understand their employees’ needs by offering benefits that are most important to them. Those who help employers supplement right-sized benefit programs with customizable and voluntary options will be recognized as valuable partners for the support they provide employers working to attract and retain talent. H Wil Trohanis is assistant vice president, Global Employee Benefits at MetLife. CALIFORNIA BROKER | 33

VOLUNTARY BENEFITS

Short-Term Disability:

Protection When Minor Injuries Become Major Problems by STEPHANIE SHIELDS REVEAL THE RISK OF DISABILITY Many people, especially those in their earlier years of life, make the mistake of thinking they are invincible and that becoming disabled would never happen to them. Brokers can leverage their expertise to inform employers and their employees of the probable risk of disability. For instance, a quarter of today’s 20-year-olds will become disabled before they retire, according to Council for Disability Awareness. Contrary to popular be-

hether it is paying the mortgage or simply buying groceries, the ability to earn a paycheck helps employees take care of their day-to-day responsibilities. For many, it is their most important asset. Suffering a disabling injury can threaten an employee’s ability to earn a paycheck, adding significant financial stress to their treatment and recovery process. Here are some things to highlight when discussing voluntary short-term disability insurance with your clients: UNVEIL THE ABILITY IN DISABILITY Short-term disability insurance gives workers the ability to protect their lifestyle when disabling injuries occur. In the event of a physician-documented disability, employees receive benefits 34 | CALIFORNIA BROKER

that can be used to help pay for whatever they deem necessary. This may include food, housing or any usual expenses, which are things an employee might otherwise have to cut back on or pay for with savings if they are unable to earn a paycheck. With short-term disability insurance, employees can focus on what’s truly important, which is recovering as quickly as possible so they can get back to work. By offering short-term disability, employers provide an option that gives employees one less thing to worry about as they focus on their recovery because they’ll have access to help when faced with out-of-pocket costs associated with a serious accident or illness – costs major medical was never intended to cover. - CalBrokerMag.com -

Encourage your clients to offer short-term disability coverage, among other voluntary benefits, to help provide protection when they need it most. lief, it’s important for clients to make sure their employees understand that short-term disability coverage is appropriate for all working-age adults to prepare them for possible hardships they may face. The need for disability insurance protection is especially crucial among primary wage-earners. Since disabling injuries or illnesses often lead to significant medical bills, anyone who works – whether they are single, married, with or without children – should consider disability coverage. The 2016 Aflac WorkForces Report claims that NOVEMBER 2016

Short Term Disability Ins. Long Term Disability Ins. High Limit Disability Ins.

Are your clients familiar with the three types of Disability Insurance? Most consumers are not aware that supplemental income protection is available nor is it something that they need. Discuss High Limit Disability with your clients.

Petersen International Underwriters

(800) 345-8816

www.piu.org

piu@piu.org

VOLUNTARY BENEFITS more than half of today’s workforce may face a financial crisis if illness, injury or disability should strike. The report also found the following: • Nearly three in five employees say they would not be able to adjust to the financial costs associated with a serious injury or illness. • 65% of employees have less than $1,000 to pay out-of-pocket costs associated with an unexpected illness or accident. When disabling health issues occur, short-term disability can offer a helping hand for those who may not be financially prepared to cover the medical and non-medical costs they’ll incur during recovery. EDUCATE EMPLOYERS ON THE NEED FOR DISABILITY COVERAGE Due to the rising costs of health insurance, many employers have limited the health coverage they provide their employees. Employees should be aware that many disabling injuries occur outside the workplace and are not covered under workers’ compensation. Without coverage from an employer or worker’s compensation, injuries, big and small, can wreak havoc on the financial stability of employees. The very twist of a knee could leave vital employees stuck at home, unable to work and incapable

of earning an income as various bills continue to pour in. Collecting Social Security from the government, an alternative coverage option for employees, may seem like a safe plan, but applying for such support can be a drawn-out, complicated

"…96% of employees who are satisfied with their benefits are more likely to be satisfied with their jobs while employees who are not satisfied with their benefits are 10% more likely to get distracted at work by personal issues." process that may end unsuccessfully. In 2015, only 32% of 2.4 million applicants received assistance from social security. Those who did collect funds received, on average, less than $1,200 per month.

Strengthen your relationship with your clients by offering a full line of Voluntary products. If you aren't, someone else is.

Offer your clients a Voluntary Group LTD plan:

• Pays from the 8th day to Normal Social Security Retirement Age • Guaranteed Issue up to a $4,000 monthly benefit • Covers up to 60% of monthly salary up to a $10,000 maximum monthly benefit • Participation down to 10 lives • Rates comparable to a traditional 12 month Short Term Disability policy

Guaranteed Issue Accident, Critical Illness and Life Insurance available as well

Instead of allowing employees to hope for a Social Security check, employers can show them they care about their prosperity today and tomorrow by providing disability insurance. SHOW THE BENEFIT OF OFFERING THE BENEFITS It is important for employers to see that employees will not be the only beneficiaries of a broadened benefits package. The 2015 Aflac WorkForces Report showed that companies offering voluntary disability insurance experienced a 36% decline in workers’ compensation claims, and 39% of those companies noted declines of 50% or more. This means that making voluntary disability plans available may actually help save your clients money in the long run. To further stretch their dollars and to create a more robust benefits portfolio, your clients can expand their benefits package to include a variety of voluntary benefits. These supplemental products provide affordable coverage options at little to no cost to your clients, all while helping increase employee satisfaction and productivity. In fact, 96% of employees who are satisfied with their benefits are more likely to be satisfied with their jobs while employees who are not satisfied with their benefits are 10% more likely to get distracted at work by personal issues. Offering a more extensive benefit package can yield positive results for employees and employers. THE BOTTOM LINE As a broker, you know that short-term disability coverage can play an important role in financial planning. Disabling injuries may not only lead to significant medical bills, they may also keep employees from going to work and earning their paycheck. Help clients see the importance of showing their employees how these situations prohibit their ability to maintain their lifestyle – sometimes causing them to lose savings, retirement funds and, in extreme cases, even their homes. Encourage your clients to offer short-term disability coverage, among other voluntary benefits, to help provide protection when they need it most. H Stephanie Shields is vice president of Product Innovation and Marketing at Aflac.

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NOVEMBER 2016

LIFE INSURANCE NEWS VISION Kemper’s Death Master File Efforts — Too Little Too Late?

Nearly 5 Million More U.S. Households Have Life Insurance Coverage

Kemper announced that it is voluntar ily making a comprehensive effort to cross-reference its life insurance policies against the Social Security Death Master File and other databases to find beneficiaries and pay claims. But Insurance Commissioner Dave Jones says that the effort falls woefully short of Kemper’s legal obligation to identify potential beneficiaries who may be unaware they are due life insurance benefits. “Contrary to the other 27 major insurers, Kemper has fought, at every turn, its obligation to use the Death Master File to search for beneficiaries. Kemper needs to step up and do the right thing. They should cease to litigate this issue, agree to search all of their policy records, and disclose their procedures and records to regulators,” he said. The following is a summary of the commissioner’s comments: Technology has existed for decades and Kemper continues to fight conducting retrospective searches for beneficiaries. Rather than having sought consensus in the regulatory community, Kemper has sued several insurance commissioners leading a national investigation of Kemper and lobbied in state legislatures to block the passage of new laws that reiterate the obligations of life insurers to use the Death Master File (DMF) to search for beneficiaries of deceased life insurance policyholders. Twenty-four other major life insurers have agreed to do the right thing by searching for possible beneficiaries on all existing policies and policies that lapsed due to non-payment because the insured was already deceased. Three other insurers were determined to be in compliance with fair claims settlement laws by searching the DMF for deceased policyholders from the moment they began to use the DMF. These insurers have done the right thing and delivered on the promises they made to their policyholders to be there for the loved ones named on life insurance policies.

There are nearly 5 million more U.S. households that have life insurance coverage, compared to 2010, according to a LIMRA’s 2016 study. The growth in households with life insurance coverage reflects an increase in population rather than an increase in market penetration. The study found 30% of households remain uninsured, equal to the record low set in 2010. “It is certainly good news that so many more families have some form of life insurance than did in 2010, and that the downward trend of overall life insurance ownership has stabilized. However, more than 37 million American families are completely uninsured and at financial risk if their primary wage earner dies unexpectedly,” said Robert Kerzner, president and CEO, LIMRA, LOMA and LL Global. Seventy percent of Millennials own some life insurance (individual, group or both). This is 10% higher than in 2010. In addition, Millennials’ ownership of individual life insurance has increased 48% since 2010. “As the leading edge of Millennials have gotten older, they are beginning to get married, buy homes and have children, which are the top triggers for people to shop for life insurance. Many of this generation became adults during the Great Recession. As a result, our studies indicate that they are more concerned about protecting their financial well-being than prior generations at the same age,” said Kerzner. The top three reasons Millennials own life insurance is to pay for final expenses (funeral, burial, etc.): 49%; to replace income: 35%; and to pay off their mortgage: 22%. This aligns with the general population. One in five households with children under 18 are uninsured, according to the 2016 study. This amounts to 3.7 million fewer households, compared with 2010 results. Of those families who have no life insurance coverage, 73% recognize they need life insurance and 62% say they would be in immediate financial trouble if a primary wage earner died. The good news is two-thirds of these households say they are likely to purchase life insurance within the next 12 months.

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In 2010, insured households had coverage to replace their income for 3.5 years. Today that has dropped to three years, which is far lower than most industry recommendations. LIMRA estimates that 48% of households (60 million) have an average life insurance coverage gap of $200,000, which amounts to more than $12 trillion in total market need. “Our Life Insurance Needs Model examines total income, assets and debt, and the overall makeup of the household to determine how much life insurance would be adequate to keep the family financially stable in the event of the death of the primary wage earner. Our findings indicate that even Americans who own life insurance might not own enough to keep their families financially secure. It is important that people reexamine their life insurance needs on a regular basis to ensure they have enough life insurance coverage as their life situations change,” said Kerzner. More than 70% of American households say a reason they have not bought more life insurance is because they have other financial priorities right now, such as paying off debt or saving for retirement. Nearly two thirds say they cannot afford it. “Consistently consumers have told our researchers they believe they can’t afford life insurance, but when we dug deeper, our research showed that many overestimate the cost by as much as 300%. Another big reason people put off buying life insurance is because they don’t know how much or what kind to buy. As an industry, we need to redouble our efforts to educate consumers about life insurance in a simple, straight-forward way,” said Kerzner. Forty-five percent of U.S households say they plan to buy life insurance in the next year – an 80% increase from 2010. This was most likely among younger households (under 45) and married couples with children. Fifty-one percent of all households say they would rely on life insurance to help pay bills and to maintain their lifestyle in the event of the primary wage earner’s death. Life insurance tops all other sources of financial assets for households earning under $50,000 annually. To view the 2016 Life Insurance Ownership Fact Sheet and other resources, visit www.limra.com/ownership. H CALIFORNIA BROKER | 37

VISION

LIGHTS, LENSES, ACTION!

Presenting A PicturePerfect Vision Plan

by Tom Rosa

HELPING EMPLOYERS CAPTURE THE NEEDS OF THEIR WORKFORCE

mployees are recognizing the value of the vision benefits more than ever as they face increasing visual demands on the job and at home. For the first time, vision is tied with dental as the second most popular benefit election, according to Transitions Optical’s 2016 Employee Perceptions of Vision Benefits survey. That’s good news for employers since offering a comprehensive vision benefit can be a cost-effective way to help contain health care costs while ensuring that workers see and perform their best. Employees who aren’t seeing their best can suffer from eyestrain, fatigue, 38 | CALIFORNIA BROKER

and headaches, which can further decrease productivity and lead to more sick days. Factors, such as ultraviolet (UV) radiation, blue light, distracting glare, and even trauma and eye injury must be addressed. Visual demands can differ from company to company, and even job to job. So it's critical for benefit brokers to develop the pictureperfect vision plan for each workforce. LIGHTS: UNDERSTAND THE SPECIFIC NEEDS OF THE CLIENT’S WORKFORCE Benefit brokers need to assess the needs of the workforce to determine - CalBrokerMag.com -

which aspects of a vision plan will bring the most value. Begin with the basics by recognizing that employees who work primarily indoors have a different visual needs than do those who work outdoors, and even those who split their time between both. Next, dig deeper into the visual demands that each staff faces. Digital eyestrain is likely affecting most workforces. More than ever, employees are spending uninterrupted time on electronic devices. Nearly 60% of Americans use digital devices for five hours or more every day; and 77% of those who suffer from digital eyestrain use NOVEMBER 2016

VISION two or more devices at a time, according to findings from the Vision Council. The majority of employees are also affected by light and glare, indoors, outdoors, or both. Distracting and even dangerous, glare can cause squinting, eyestrain, eye fatigue and, in extreme cases, temporary blindness. Protection from blue light is also a rising concern for many companies and employees. Long-term exposure to blue light is linked to increased risk of developing age-related macular degeneration, which is the leading cause of vision loss in adults over 50, according to the National Eye Institute. Most people associate harmful blue light with using digital devices, but many don’t know that the sun is the largest source. As a benefit broker, it’s important to identify the conditions that a workforce is facing in order to prioritize lens options to include in the vision benefit offering. LENSES: TAILOR YOUR VISION PLAN It's important to offer vision plans that stay competitive and include lens options that meet the visual needs of today’s workforce. Employees want a wide selection for their frames, but they also want and need a choice in lens options that will fit their visual needs. In fact, 87% of employees say that having premium material coverage is important when selecting a vision plan, according to the Transitions Optical Employee Perceptions of Vision Benefits survey. A comprehensive vision benefit package can be a significant tool to help employers attract and retain top talent. One-third of survey respondents accepted a new job in the past year because it offered a competitive benefit package or they know someone who has. Not all companies put enough emphasis on these competitive benefits: nearly one in four employees say their plan doesn't offer enough choice in lens options. When presenting vision plan recommendations to employers, it’s important for benefit brokers to understand what employees want from their plans, particularly in relation to light and sun protection. New and improved lens treatments minimize glare and reflections, helping optimize vision and reduce the NOVEMBER 2016

eyestrain and fatigue that plague the digital workforce. The use of antireflective lenses is an important consideration for reducing glare indoors. Photochromic lenses, like Transitions adaptive lenses, go a step further by adjusting automatically from clear to dark to provide enhanced vision and protection from UV rays outdoors—as well as additional protection from glare and harmful blue light indoors and out. Plans that cover impact-resistant lenses and safety frames should be recommended to help protect against trauma

covers. A similar number of employees don’t know what discounts and coverage their plan offers on eyeglass lens options, such as progressives and photochromics, according to the Transitions survey. Many optical companies and vision plans offer tools for benefit brokers to share with employers, who can, in turn, share them with their employees. It can also be helpful to send employees to the vision plan website to learn more. Consider that 29% of employees say a vision plan’s website is the most valuable resource

for employees whose work puts them a risk for standard lenses to shatter.

to understand their benefits, with 26% listing the vision benefit provider as the second most important resource. By following these simple steps, benefit brokers can be a true resource and partner in making sure employers are selecting the right vision benefit plans for their workforce and spreading the word to their staff. H

EDUCATE EMPLOYERS AND ARM THEM WITH THE TOOLS TO EDUCATE EMPLOYEES Vision benefits are important to employees—so much so that eight in 10 employees choose to enroll in a vision plan offered through their employer. It’s critical for benefit brokers to explain the importance of offering a comprehensive vision benefit to employers, and help them determine the options that their employees want and need. To sell the value of the vision benefits, it can be helpful to showcase a vision plan’s return-oninvestment. Once the employer selects the ideal vision plan, it's important to provide tools to educate employees during the enrollment period and year-round. More than one-quarter don’t know which lens materials their vision plan - CalBrokerMag.com -

Tom Rosa, senior vice president of Client Management for Davis Vision maintains executive responsibility for all of the managed vision care company’s key accounts including commercial business, union-represented organizations and government entities. He supports several teams of client managers whose responsibilities include ongoing development of client relationships, as well as retention and growth of business. Tom has been with Davis Vision since 1986, having served its members in a number of capacities including retail operations, operations, sales and marketing. He is a graduate of Hobart College, where he earned a Bachelor of Arts degree in Economics. Tom is located in the Syracuse, N.Y., regional office. CALIFORNIA BROKER | 39

TECH LONG-TERM TALK CARE

Technology Helps Brokers Manage The Dark Side Of Customization

sk most people if customization is a good thing and there’s a pretty good chance they’ll answer yes. After all, who wouldn’t want to get exactly what they want instead settling for close enough. Yet with more options often comes more confusion and uncertainty. It’s like using a traditional six choice soda fountain versus one of those machines that provides hundreds of choices. You may not have gotten exactly what you wanted at the traditional fountain, but it didn’t take you 10 minutes to decide which one to get either.

By JOE DONLAN It’s the same with health insurance options. In the past, brokers would speak with employers about employee needs and recommend the two or three plans they felt best covered all the requirements. That made it easy for brokers to manage – you normally only had to work with the company’s designated benefit manager – and for employees to select since each of the plans was usually quite distinct from

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the others. In the post-Affordable Care Act (ACA) era, there are many more variables for all parties to contend with. All those health plan choices with all their subtle differences can quickly cause confusion and consternation for members – especially those with low health or even general literacy. More importantly, that kind of aggravation can lead them to select the wrong plan

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for them and their families just to get it over with, leading to difficulties later should a serious health problem occur. If a situation like that occurs a few times, it can endanger your relationship with the employer. After all, the employer is offering health insurance and ancillary coverage as a benefit to attract and retain quality employees, or maybe out of a sense of caring for the staff as a whole. No matter what the

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TECH TALK reason, if employee needs are not being met by the current broker the employer will be far more inclined to look for another who will do a better job. The challenge today is finding a way to meet the needs of dozens, hundreds or even thousands of individuals rather than a handful of professional benefit managers. Technology is the key, both for employers and employees. AUTOMATING BENEFIT ADMINISTRATION It begins with a solid foundation that helps employers manage benefit administration more effectively. For some employers that will simply mean managing benefits for the current, active, fulltime employee roster. For others, it may include part-timers, retirees or other groups who will have different requirements as mandated by the government as well as the employer’s preferences. Regardless of the number of separate groups, it must be easy for employers to add, delete and even move members if they go from one group to another. Employers need tools to help them manage ACA compliance, manage and track eligibility and enrollment, alert them to changes (such as new life events such as a wedding or birth) that could affect coverage, integrate their payroll system, and handle the thousands of other tasks associated with offering health and financial benefits today. You will gain a very distinct competitive advantage as a broker if you can offer your employer clients the technology to simplify and automate this mountain of traditionally manual benefit administration tasks, especially in the face of dozens of separate insurance options. Employers have a lot at stake in terms of health insurance these days, and the landscape has become exponentially more complex. Being a partner that can shift that burden, or at least most of it, off the employer helps turn the conversation from cost to service. HELPING MEMBERS MAKE AN INFORMED CHOICE The good news for consumers in the post-ACA world is that they no longer have to settle for general health insurance plans designed for the masses. They can NOVEMBER 2016

now select a plan that suits their needs more closely. While it may not be tailormade, it’s not just off the rack either. The downside is that most people have little understanding of the nuances of health insurance. So while there may be a perfect plan out there for them, it may be difficult for them to find it. That can lead to a lot of employee dissatisfaction, whether it’s being hit with a huge out-of-pocket expense for an emergency department visit, discovering, after the fact, that a particular doctor’s visit wasn’t covered, or some other issue. Helping employees make the right choice from among dozens of health and ancillary options is one of the most important services brokers can offer. Yet it’s not really feasible using the traditional call center. That’s where consumer-facing technology can again create a huge competitive advantage – the kind that keeps accounts happy and secure. Rather than simply laying out the options and maybe having a static comparison chart like people use when selecting a lawn mower from an online retailer, you can offer technology that walks employees through the decision process interactively. The technology should not only tell employees which options are available, but also what those options mean in simple language – or even multiple languages depending on the employee base. The technology should help lead the employee to an informed decision based on the answers to questions, such as age, family status, health history, risk tolerance, etc. It should also take a holistic look at the employee’s situation and make recommendations for additional products where appropriate. For example, if the employee selects a high deductible health plan to keep premium costs down, the technology should automatically recommend accident and/or catastrophic illness coverage to guard against an unforeseen event that could bring financial ruin. If the employee already wears glasses, or works in a job where eye strain is common, the technology can recommend adding vision care. A life event, such as a wedding or birth, might prompt a recommendation for life insurance. - CalBrokerMag.com -

By offering technology that helps employees make not just a choice, but the best choice for the situations that they and their families are in, you can add immeasurable value for employers and employees. After all, happy, healthy employees make for a stable and productive employee base. Of course, the technology needs to do more than help the enrollment decision process. It must also make it easier for employees to manage their benefits throughout the year. It should be able to answer most questions so employees can manage the bulk of their benefits themselves, and only feel the need to contact the call center for a particularly complex issue. Helpful tools such as assistance with searching for the lowest-cost option for prescription medications, or even approved money-saving alternative therapies, win member praise while making you more difficult to displace. The key is to make all these tools and technologies as easy to use as ordering a book or choosing that lawn mower online. Consumer expectations for information availability, ease-of-use, and service have been set by their experiences with online retailers, telecom carriers, technology manufacturers and others. If the technology you offer doesn’t match that experience it will quickly be dismissed. With the right technology in place, you can distinguish your organization while increasing both client acquisition and retention. END THE CONFUSION Health insurance is already complex and intimidating enough on its own for most people. And as with the soda machine the availability of more similarsounding choices, while good in some aspects, makes it far more confusing. By offering the right technology you can help your clients do a better job of delivering benefits to their employees, and help the employees find the health plan and other benefits that suit them best. You can also help them take full advantage of the benefits they do select, creating greater satisfaction and goodwill between employers and their employees. H Joe Donlan is senior vice president of the Broker Segment at Connecture Inc. CALIFORNIA BROKER | 41

LONG-TERM CARE

Rethinking the Approach of Long-Term Care with Clients Y

ou meet with a client to discuss long-term care insurance (LTCi) solutions. They listen attentively as you lay out the strong statistical rationale in favor of LTCi and the many options they can choose from, believing the decision would become clear to them and coverage would be purchased. But they say they'll have to think about it or the timing just isn't right. Sound familiar? Despite our best efforts and compelling factual arguments in favor of LTCi, adoption rates have consistently hovered around 8%, which corresponds with the percentage of the population that is predisposed to long-term planning by nature. So why isn’t the traditional approach to planning for LTCi working for the other 92%? The answer, it turns out, might be revealed by some fascinating recent research into behavioral economics, which considers economic decision making from a psychological perspective. Best-selling books such as “Nudge” by Richard Thaler, “Thinking Fast and Slow” by Daniel Kahneman, and others have explored this fascinating topic. The research behind behavioral economics suggests that people really don’t act rationally as classical economics assumes. Instead, people are motivated to act based on their emotions and impulses. Moreover, the choices we actually make are very dependent on how options are presented to us. Organizations are beginning to use the findings of behavioral economics to nudge people to take actions. For example, more companies now autoenroll employees in 401(k) plans and make them opt-out if they don’t want to join. The result has been a big increase in 401(k) participation. Another finding—that too many choices lead to inaction—has led to a narrowing of investment options. Similarly, default 42 | CALIFORNIA BROKER

by STEVE CAIN

choices, such as target date funds, are now part of many 401(k) plans. Here are six ways in which the findings of behavioral economics can help improve your closing rate when engaging in LTCi planning with clients: 1. Don't complicate the choices. As an advisor, you may think that your job is to give a possible buyer multiple options for planning for care, such as spread sheeting several insurance carriers or comparing standalone and linked products. The reality is that consumers don’t want this; they want a recommendation with just a few choices. Share your due diligence, but limit the information to what you believe are the best options for them to consider. 2. Focus on the possible gain LTC will provide instead of the possible loss. Research has shown that just like gamblers, we all want to win and we don’t like to think about losing. People who are considering LTCi don’t want to think about loss when planning for care, such as how their retirement savings may be depleted. Instead, consider focusing on the fact that a small LTCi premium gives the policyholder the possibility of a big payoff in benefits. For example, a $2,000 annual premium could result in $300,000 to pay for high-quality care at home. 3. Use stories instead of statistics! Statistics are important for discovering trends and insights, but they are awful when used for discussing LTC planning. People are way too optimistic about their future and think they will be on the winning side of a statistic. Focusing on stories and experience that prospects can relate to is a much better approach than using statistics that can destroy empathy when talking about planning for LTC. - CalBrokerMag.com -

4. Focus on now benefits, not the future. It's incredibly difficult for people to imagine aging and needing help. Instead, focus on the now benefits of LTCi. The now benefits are more difficult to quantify, but they can include peace of mind, good health underwriting and locking into a lower premium before a birthday. 5. Help guide heuristics (rules of thumb). When designing plans, it's tempting to use tools, such as surveys that project the cost of care 40 years in the future. A better approach is to follow the crowd and recommend benefits similar to what other policyholders are actually buying. You may think people want customized solutions, but most would feel more comfortable picking options similar to other buyers. Recommend they do what most people are doing. 6. Nudge a choice. When people have to make a decision, such as actively signing off on the fact they have been offered LTCi but declined, they will be more likely to buy. LTC planning is easy to delay, and people need motivations to keep them from delaying the decision forever. Behavioral economics is a controversial topic, but we think it offers food for thought about whether the way we have traditionally approached LTCi planning with prospective clients is the best approach. Employing some of its findings might move us beyond the 8% threshold of highly motivated long-term planners to help the remaining 92% of the population engage in meaningful consideration of their longterm care needs. H Steve Cain is a principal at LTCI Partners, a brokerage general agency (BGA) specializing in long-term care insurance solutions. Contact Cain at steve. cain@ltcipartners.com and visit www.ltcipartners. com for additional information. NOVEMBER 2016

NEWS EMPLOYEE BENEFITS SURPRISING FACTORS INFLUENCE JOB SATISFACTION While pay and job security remain essential to employee satisfaction, trust, open communication, professional development, and company reputation play an increasingly important role, according to a study by Ultimate Software. In fact, these factors were often ranked of equal or greater importance than compensation or financial motivators. One of the most interesting findings is the relationship between trust and satisfaction—with 93% of employees saying that having trust in their direct manager is important to remain satisfied at work, an even higher percentage than those who said they must trust company leaders. This is noteworthy because many companies focus their leadership training and development on rising executives, VPs, and senior-level directors rather than line managers and supervisors who have a greater impact on employee satisfaction and retention. The study reveals the following about employees: • 92% say that having the technology they need to do their job efficiently affects satisfaction at work. Nearly one out of three would quit their job if they had to use outdated technology at work. • 75% are more likely to stay with a company longer if their concerns are addressed. In fact, more respondents ranked this consideration as more important than getting credit for their ideas. • 73% say that having the opportunity for professional development is necessary to feel satisfied at work. • 71% say that open communication with their manager contributes significantly to job fulfillment— even more than having clearly defined tasks. • 60% say that a lack of emotional safety at work would make them quit a job immediately. More respondents cited the need for an environment free of harassment, intimidation and offensive behavior than those who said that a lack of physical safety would make them quit. • 85% are likely to stay longer with an employer that shows a high level of social responsibility by supporting charitable causes, volunteering in the NOVEMBER 2016

community, and/or taking a stand on social issues. To view the full survey results, visit www.ultimatesoftware.com/happywork. SUPPORTING WORKPLACE MENTAL HEALTH In recognition of World Mental Health Day on Oct. 10, the Standard Insurance Company offered these tips on mental health accommodations in the workplace: • Understand the importance of accommodations: Living with an illness, injury, or chronic condition — like depression — can be challenging and can lead an employee to feel labeled by their diagnosis. Accommodations can put your employees

at ease and allow them to be as productive as possible. Stay-at-work accommodations or other workplace modifications can go a long way to help an employee manage their condition. Accommodations may be regulated under the Americans with Disabilities Act. They often help an employee feel supported and valued and be more productive. • Use your disability carrier for assistance: Some disability insurance carriers provide assistance with an employee’s stay-at-work or returnto-work accommodations. Some provide mental health consultants to help employers develop and implement stay-at-work plans. A mental health consultant can contact the employee and their medical team to understand any limitations or restrictions. By having experts available to assess an employee’s needs and come up with a plan, the employee - CalBrokerMag.com -

gets the best assistance and the company stays compliant with regulations. • Tailor accommodations to each employee: Mental health consultants can analyze the employee’s job role and work environment to help provide the best recommendation to keep them on the job. Depending on the employee and their condition, effective accommodations can include giving an employee the flexibility to attend appointments, or move their workstation to an area with less distractions, says Dr. Jeff Guardalabene, senior behavioral health case manager from The Standard. He said that some accommodations require the employer to be flexible and creative. For example, an employee with bipolar disorder may find their natural rhythms disrupted. Not all jobs allow for flexible schedules, but if they do, allowing an employee to work when their sleep/wake cycle isn’t disrupted can avoid triggering mania or depression. “An employer that is proactive in how they provide assistance for an employee with a mental health condition can make all the difference between lost time and productivity,” he added. DISABILITY SALES ARE UP A 2016 Milliman survey reveals that new annual disability premiums are the highest they have been since the 1990s. There was a solid 5.8% growth in new annual premium from 2014 to 2015. Robert Beal of Milliman said, “It’s been a tumultuous 10 years for individual disability income carriers…2016 presents a much healthier picture of the market than in many years past.” New premium from the employer-sponsored multi-life market accounts for more than 40% of total individual new premiums in 2014 and 2015. There was a reduction in the share of new individual premium issued using voluntary guaranteed standard issue (GSI) underwriting. The full report is available from Milliman at http://www.milliman.com/ individual-survey. VOLUNTARY MARKET TRENDS A report by Eastbridge finds that individual voluntary product sales are flat while group voluntary sales products CALIFORNIA BROKER | 43

NEWS are up 10%. The top two selling lines of business are again term life and dental, but accident rather than shortterm disability (STD) follows in the third position. Although STD continues to enjoy a decent share of the product mix at 13%, it saw modest growth of just 2% last year. Critical illness products saw a 25% growth in sales while long-term care sales fell nearly 40%. The benefit broker segment continued to take the largest share of voluntary/ worksite sales (at 60%) while the career agent segment had the second highest (but decreasing) share. The top 15 companies in the voluntary/worksite market accounted for about 78% of voluntary sales in 2015, with Aflac, MetLife, Unum, and Colonial Life leading. These carriers and several other key industry players are profiled in the report, including Cigna, Guardian, Transamerica, The Hartford, Lincoln Financial and Prudential. The latest study, “Voluntary/Worksite Marketing Industry Snapshot and Competitor Profiles,” is available for $2,000. For more information call 860-676-9633 or email Eastbridge atinfo@eastbridge. com.

Cooper was sentenced to 18 months in jail, five years’ formal probation, and ordered to pay $60,000 in restitution. After receiving a complaint, the California Department of Insurance Investigation Division launched a joint investigation with the Rocklin Police Department revealing that, as her mother’s trustee, Cooper wrote checks to herself from the trust accounts and falsified trust statements to conceal her thefts. Cooper was arrested at work by the Rocklin Police Department. This case was prosecuted by the Placer County District Attorney’s office. The department has revoked Cooper’s license. COVERED CALIFORNIA URGES MEMBERS TO SHOP AND COMPARE Covered California’s third-ever renewal period began this week. Peter V. Lee,

IN CALIFORNIA DMHC LAUNCHES HEALTH PLAN DASHBOARD The Department of Managed Health Care (DMHC) launched the Health Plan Dashboard, an online tool to make health plan data more transparent and accessible to the public. It aggregates more than a dozen public data sets reported by health plans and the DMHC, such as enrollment by market type, financial reports, premium rates, consumer complaints, audit reports, and Department enforcement actions. The Health Plan Dashboard also creates easy-to-understand charts and graphs from the data. For more information, visitwww.dmhc.ca.gov/HealthPlanDashboard.aspx. FORMER AGENT EMBEZZLED FROM HER MOTHER Christine Ann Cooper, 64, a former licensed insurance agent, pleaded nolo contendere to a felony for embezzling about $129,000 from her mother’s trust accounts over a nine-year period. 44 | CALIFORNIA BROKER

executive director of Covered California said, “Nearly 80% of our consumers will be able to pay less than they are paying now for health insurance, or see their rates go up by no more than 5% if they shop and switch to another plan. Members renewing their coverage will have access to an upgraded shopping tool that enables them to see their plan and 2017 rates highlighted side-by-side with their other insurance plan choices for next year. “This feature will make it much easier for consumers to shop and compare before selecting a plan for 2017. This is particularly important where there is a larger variation in premium increases than we’ve seen in prior years with some plans raising rates by 5% or 6%, and others in the high teens,” Lee said. The new Shop and Compare tool displays health and dental plans - CalBrokerMag.com -

separately, showing up to 12 product options on a page instead of three and offering more ways to filter plan choices for the consumer. In 2017, Covered California will feature coverage from 11 health insurance companies: Anthem Blue Cross of California, Blue Shield of California, Chinese Community Health Plan, Health Net, Kaiser Permanente, L.A. Care Health Plan, Molina Healthcare, Oscar Health Plan of California, Sharp Health Plan, Valley Health Plan and Western Health Advantage. In addition, some insurance carriers will be increasing their coverage areas, with Molina expanding into Orange County, Kaiser Permanente available in Santa Cruz County and Oscar offering coverage in San Francisco County. With insurers entering new areas, 93% of consumers will have at least three insurers to choose from in their region, and none will have fewer than two. In addition, more than 93% of hospitals in California will be available through at least one health insurance company in 2017, and 74% will be available in three or more plans. Covered California has also improved its patient-centered benefit designs by increasing a consumer’s access to care through reducing the number of services that are subject to a consumer’s deductible. In 2017, consumers in Silver 70 plans will save as much as $55 on an urgent care visit and $10 on a primary care visit. In addition, consumers in Silver, Gold and Platinum plans will pay a flat copay for emergency room visits without having to satisfy a deductible, which could mean thousands of dollars in savings. Urgent care costs in every 2017 plan will be same as the primary care visit, resulting in significant consumer savings. These improvements build on features already in place that ensure most outpatient services in Silver, Gold and Platinum plans are not subject to a deductible, including primary care visits, specialist visits, lab tests, X-rays and imaging. Even consumers in Covered California’s most affordable Bronze plans are allowed to see their doctor or a specialist three times before the visits are subject to the deductible. Consumers who take no action by NOVEMBER 2016

NEWS December 15 will be renewed into their existing plan. Covered California is Directing consumers to visit coveredca.com, call their certified insurance agent or certified enrollment counselor, or call covered California at (800) 300-1506 for enrollment or renewal assistance. People who have health coverage through Medi-Cal renew their coverage throughout the year when contacted by Medi-Cal. SCAN OFFERS NEW PREFERRED PHARMACY NETWORK SCAN’s 2017 benefit plans include a new preferred pharmacy program that offers lower copayments for prescription drugs. In many counties this gives plan members the option to pay $0 for many commonly used generic drugs. Beginning January 1, SCAN members will save money when filling prescriptions at a preferred pharmacy. In the majority of the counties we serve, that will mean no copayment for many commonly used generic drugs while copayments for brand-name drugs will be approximately $5 lower. Preferred pharmacies include such large chains as Albertsons, Costco, Express Scripts, Rite Aid, and Walgreens and select independent pharmacies with more than 24,000 locations nationwide. In addition, members still have access to another 46,000 standard pharmacies, where 2017 copays will remain at 2016 levels. Aside from key enhancements, 2017 benefits remain largely consistent with 2016 benefits. MEDICAID PLANS EXPERIENCE FIRST DECLINE SINCE 2009 IN ADMINISTRATIVE COSTS In 2015, core administrative Medicaid expenses (excluding sales and marketing) declined 5.5% per member, the first time since 2009. Account and membership administration costs increased 4.9%, the fastest rate since 2011. These comparisons eliminate the effects of product mix and universe changes, according to the Sherlock Company. Costs declined for medical and provider management, corporate services, and sales and marketing. The median core expenses for all products offered by these plans was $29.06 per member per month (PMPM) compared to $27.99 in the prior year. The NOVEMBER 2016

study analyzes in-depth surveys of 10 Medicaid focused plans serving 7.9 million members, of which 4.7 million are Medicaid HMO or Medicaid CHIP members. Additional information is posted at sherlockco.com/navigator.

INDUSTRY UPDATE INSURERS ARE FAILING AT DIGITAL CUSTOMER SERVICE Despite the growth of digital channels, U.S. insurers are not responding accurately, quickly, or consistently to customer queries, according to research from software provider Eptica. Insurers answered only 37% of questions that came from e-mails, 30% from their websites, 23% from Facebook messages, and 12% from Tweets.

Forty-seven percent of insurers didn’t provide consistent answers among different channels. Just one company replied on all four channels of e-mail, Facebook, Twitter and chat. Even when they did answer, the responses were not always helpful. Sixty-eight percent of responses on email, Twitter and Facebook simply asked the consumer to call the company, even for the most basic queries. Fifty-seven percent of consumers expect a response on Twitter within half an hour, but only 26% of insurers met this deadline. One long-term care insurer responded to a tweet in under two minutes and 13 companies answered on Facebook within five minutes. At the other end of the spectrum, 20 insurers took over six hours to respond on social media, with three taking a day or more. There were big - CalBrokerMag.com -

differences among particular sectors. Pet insurers answered 57% of questions online while long-term care insurers answered only 15.5%. One dental insurer responded to an email in 13 minutes while another took over six days. Sixty-one percent of consumers said they could not find information on company websites half the time they looked for it. Forty-six percent of consumers say won’t spend more than five minutes searching for information on a company website before giving up. Seventeen percent of insurers claimed to offer chat on their Websites, yet only 5% had it operational when they were evaluated. For more information, visitwww.eptica.com

ANNUITIES FIDUCIARY RULE BOOSTS FIXED INDEXED ANNUITIES Fixed-indexed annuities have had the largest growth in the annuity market thanks to the Dept. of Labor’s (DOL) looming fiduciary rule. There has been a corresponding decrease in variable annuities, according to AM Best. Variable annuity sales were down about 18% in the first quarter of 2016 and further in the second quarter of 2016. Edward Kohlberg, associate director of A.M. Best said, “Companies have looked to de-risk their product portfolios, and they’ve lessened the guarantees on variable annuities, which have lowered sales amounts in the last few years. He noted that the DOL’s fiduciary rule changes will include additional fee disclosures and more level compensation structures. Consumers must also contend with the increased volatility in equity markets. Policyholders are looking for more stable returns from fixed and equity index products, which is why fixed-indexed annuities have seen the largest growth in the annuity market. Companies still have some time to revise their product mix or design since full the fiduciary rule doesn’t go fully into effect until 2018. Kohlberg says that companies are examining their product portfolios and strategies. The Best Special Report, can be viewed at http://www3. ambest.com/ bestweek /purchase. asp?record_code=253525. H CALIFORNIA BROKER | 45

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NOVEMBER 2016

Meet Mr. & Mrs. Reason and all the little reasons why we do what we do in a day.

We do it for the checkups. We do it for the aches, the pains, the schoolyard accidents, and the flu that’s been going around. We do it for the pregnancies, the pulmonary exams, and the post ops. We do it for the lives we’ve touched. And, if you’ve been a broker for a while, you’ve touched quite a few. You’ve made them better, you’ve made them healthier. Just like you, we know how easy it is to get caught up in the demands of the day. The number crunching, the problem solving, the questions concerning healthcare options. Our job is to make your job easier with all the right answers, smart strategies, properly placed plans, never-ending troubleshooting and deft handling of your toughest service issues. If you know Rogers Benefit Group then you know that we

don’t just do the paperwork and disappear. We educate. We answer questions. We will represent you in the field with employers and with their employees. RBG account managers go out and talk to families, advise them with their choices, sift through the confusion and make sure that their plan fits their needs. Everyone at Rogers Benefit Group knows that an ounce of prevention is worth a pound of cure so we make a point of encouraging healthy practices. We know that lives depend on the guidance and decision-making that we provide. No doubt, there are a number of reasons, big and small, why we do what we do in a day. We’re here to help you with them all. Call or visit our website at www.rogersbenefit.com. It’s the first step toward finding the kind of support and service you’ve always imagined was out there.

Turning A Challenge Into A Career. Twenty years ago, Jason Reichart was facing cancer without health insurance. An avid fisherman, he was methodical in developing a plan to take on his health scare and become cancer-free. Today, he’s using that experience to help others prepare. He could have selected any GA as his partner, but he chose Word & Brown because our philosophy mirrors his – a commitment to delivering solutions backed by extraordinary service.

Watch Jason’s advice for those entering the business at saythewordbroker.com

Say the word. Northern California 800.255.9673 | Inland Empire 877.225.0988 | Los Angeles 800.560.5614 | Orange 800.869.6989 | San Diego 800.397.3381