These are difficult times for benefits administrators—especially those working for smaller companies. Costs seem to endlessly rise; the regulatory environment continually changes; and a combination of market forces make it harder and harder to manage what seems to be an increasingly nightmarish health insurance marketplace.
Unfortunately, HR professionals aren’t the only ones finding the environment challenging. Major insurers are too—and it’s too the point where some major national companies are pulling up stakes and abandoning the small group market altogether.
This is a severe blow to smaller companies and their employees. There are fewer coverage choices available; those that remain offer diminished number of options, and plans are becoming more expensive. Employers are left with the unappealing prospect of signing on for higher-cost, lower-value plans, and then having to explain themselves to dissatisfied employees.
At Trion, we’ve been able to help some of these employers out. While remaining with a company’s prior insurer may not be an option, we are able to help companies abandoned by their insurer to find roughly equivalent plans elsewhere while containing costs—and sometimes even reducing them. The key is economy of scale: As a major Professional Employer Organization, Trion is eligible to obtain large-group benefits that are beyond the reach of small and medium-sized enterprises.
Access to a broad range of lower-cost large group plans enables us to offer client companies a range of benefit choices that are usually better than those they’d received from the insurers who had left them behind. Our larger size also gives us increased negotiating strength: We are able to leverage our large-group eligibility to attain more favorable terms and increased plan customization. As a result, clients often find that the disruption created by being “fired” by their insurer of first choice leaves them better off both financially and in terms of employee morale.
We don’t believe that it’s going to be particularly smooth sailing ahead in the insurance marketplace—far from it. Both larger and smaller insurers are caught up in a whirlwind of fast-paced change as the marketplace evolves, as new Affordable Care Act mandates come into force, and as industry consolidation takes place. Whether they like it or not, benefit professionals are going to have their work cut out for them as the ripple effect of these changes makes itself felt in their companies.
In our roles as our clients’ trusted consultant and as a PEO, it’s part of our job to try to make these types of changes ultimately work to the benefit of our clients, however initially disruptive they may be. We’re happy to help any company whose insurer has outgrown them find a solution that works for them, their employees, and their bottom line.