The importance of wellness in reducing overall health care costs has been in the news a lot lately. However, recent studies show that fewer than one in three firms embrace the concept, despite evidence that wellness programs positively impact health care utilization rates, improve employee attendance and reduce turnover.
For many agent/brokers, wellness programs are viewed as a nuisance and part of the consumer directed health care movement that they can do without. Yet, wellness efforts can be an effective tool to retain current clients and as well as to prospect for new business.
As in most situations involving company benefits, the chief financial officer (CFO) is the primary decision maker. For the CFO, the bottom line will always be: Can an investment here drive bigger profits? With an increasing number of health care insurers offering wellness options, the case can be made that wellness investments will return significant dividends.
The question for an agent/broker is the extra work needed to convince a client that adopting a wellness program is worth the effort. Equally important is to identify the arguments that will sway the human resource manager and the CFO.
First, let’s look at the positives.
For many, the experience was not pleasant: Convincing clients to install a wellness program added to their workload, and they received scant thanks from clients.
For others, the results were more gratifying: increased client loyalty, referrals to other companies and sales of other types of insurance.
In all cases, the companies involved focused on one thing — reducing their overall health care costs.
In a recent survey conducted by Information Strategies, Inc. (ISI) aimed at HR managers, the need to install wellness was ninth on a list of priorities they said were needed to reduce their benefits costs.
However, in firms that had installed these programs, six of nine respondents said there were benefits to be had. Most interestingly, seven of nine respondents with installed efforts said they were encouraged by their agent/broker to look into the benefits of wellness programs.
In follow-up interviews, these HR managers said they were more apt to recommend their agent/brokers to others because of their experience with wellness programs.
The downside to this was that those HR leaders who experienced poor results or negative feelings toward their wellness efforts put much of the blame on the agent/broker and the insurance provider.
Trends
According to surveys conducted by ISI, it appears that many firms with 100–500 employees can earn significant savings through wellness efforts. In firms with less than 100 employees, the results are far less tangible due to the smaller size of the labor pool.
Conversely, it appears that smaller firms have a better atmosphere for building heavily interpersonal programs that involve all levels of management.
For the agent/broker with a strong client relationship, there is little reason to risk that connection by offering something new or different.
The other constituency for agent/brokers is the employees themselves. As more and more of the health care insurance burden shifts to the employee, programs that mitigate their costs are becoming more important to the ultimate consumer.
One way to keep current clients and earn new leads is by teaching employees to be healthier and more proactive in managing their own health. The nation as a whole agrees that weight loss and smoking cessation are two key programs that can reduce lifetime illness.
While companies don’t have a responsibility to micro-manage their employees' health, they have a vested interest in improving the bottom line.
Agent/brokers tell ISI that they get positive feedback when programs succeed not only for employers, but employees as well. More importantly, agent/brokers are able to use this service as part of their reference sell when seeking new clients.
One agent said, "The wellness program in one company improved the health of the top managers to such an extent that I could finally get them eligible for key-man life insurance at a reasonable rate."
With health care insurance rates still rising, albeit slower than in recent years, it is important that agent/brokers offer their clients as many options as possible.
Despite the extra work needed, wellness programs are an effective option for many companies and it behooves agent/brokers to look into how they can benefit from this trend.
Wellness as part of the sales process will grow in coming years. For the innovative agent/broker this trend can mean more commissions in their pocket.
For many agent/brokers, wellness programs are viewed as a nuisance and part of the consumer directed health care movement that they can do without. Yet, wellness efforts can be an effective tool to retain current clients and as well as to prospect for new business.
As in most situations involving company benefits, the chief financial officer (CFO) is the primary decision maker. For the CFO, the bottom line will always be: Can an investment here drive bigger profits? With an increasing number of health care insurers offering wellness options, the case can be made that wellness investments will return significant dividends.
The question for an agent/broker is the extra work needed to convince a client that adopting a wellness program is worth the effort. Equally important is to identify the arguments that will sway the human resource manager and the CFO.
First, let’s look at the positives.
- Wellness programs are an important tool in reducing health care utilization rates with results running anywhere from 5 percent to 23 percent.
- Absenteeism goes down in almost every company with a wellness program in place, with the numbers ranging from 2 percent to 10 percent.
- Employee turnover also tends to slow, although no one has yet figured out why.
- The most glaring negative is that they require additional time and resource investments to be truly effective.
- Worse, in this era where companies look to quarterly and yearly numbers, wellness programs require time to work.
- The ROI (return on investment) is measured in years rather than months, and is reflected in so-called "soft" areas such as utilization and absenteeism.
- For the agent/broker, when a company adopts a wellness program, there is extra work and extra involvement.
For many, the experience was not pleasant: Convincing clients to install a wellness program added to their workload, and they received scant thanks from clients.
For others, the results were more gratifying: increased client loyalty, referrals to other companies and sales of other types of insurance.
In all cases, the companies involved focused on one thing — reducing their overall health care costs.
In a recent survey conducted by Information Strategies, Inc. (ISI) aimed at HR managers, the need to install wellness was ninth on a list of priorities they said were needed to reduce their benefits costs.
However, in firms that had installed these programs, six of nine respondents said there were benefits to be had. Most interestingly, seven of nine respondents with installed efforts said they were encouraged by their agent/broker to look into the benefits of wellness programs.
In follow-up interviews, these HR managers said they were more apt to recommend their agent/brokers to others because of their experience with wellness programs.
The downside to this was that those HR leaders who experienced poor results or negative feelings toward their wellness efforts put much of the blame on the agent/broker and the insurance provider.
Trends
According to surveys conducted by ISI, it appears that many firms with 100–500 employees can earn significant savings through wellness efforts. In firms with less than 100 employees, the results are far less tangible due to the smaller size of the labor pool.
Conversely, it appears that smaller firms have a better atmosphere for building heavily interpersonal programs that involve all levels of management.
For the agent/broker with a strong client relationship, there is little reason to risk that connection by offering something new or different.
The other constituency for agent/brokers is the employees themselves. As more and more of the health care insurance burden shifts to the employee, programs that mitigate their costs are becoming more important to the ultimate consumer.
One way to keep current clients and earn new leads is by teaching employees to be healthier and more proactive in managing their own health. The nation as a whole agrees that weight loss and smoking cessation are two key programs that can reduce lifetime illness.
While companies don’t have a responsibility to micro-manage their employees' health, they have a vested interest in improving the bottom line.
Agent/brokers tell ISI that they get positive feedback when programs succeed not only for employers, but employees as well. More importantly, agent/brokers are able to use this service as part of their reference sell when seeking new clients.
One agent said, "The wellness program in one company improved the health of the top managers to such an extent that I could finally get them eligible for key-man life insurance at a reasonable rate."
With health care insurance rates still rising, albeit slower than in recent years, it is important that agent/brokers offer their clients as many options as possible.
Despite the extra work needed, wellness programs are an effective option for many companies and it behooves agent/brokers to look into how they can benefit from this trend.
Wellness as part of the sales process will grow in coming years. For the innovative agent/broker this trend can mean more commissions in their pocket.
