Better Business for Small Business Leaders

How to Win the Talent War with Strategic Insurance Plans with Alice Rhodes

• Chrissy Myers • Episode 21

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Ever wonder why finding a good health insurance broker feels impossible, especially as a small business owner? Alice Rhodes from AUI pulls back the curtain on the often-mysterious world of employee benefits with refreshing candor and deep expertise from her 25-year career.

"I never just send stuff because their head's going to pop off," Alice explains, highlighting her personalized approach to guiding small businesses through the complex insurance landscape. While most brokers overwhelm clients with 80-page quotes and disappear until renewal time, Alice emphasizes the importance of regular communication and truly understanding each business's unique needs.

The podcast tackles common misconceptions head-on. Contrary to popular belief, working with a broker doesn't increase your insurance costs – carriers set the commissions regardless of whether you work directly with them or through an agency. Alice shares a compelling success story where shopping around helped a 20-employee business upgrade from a $3,000 deductible plan to a $500 deductible while simultaneously saving 20% on premiums.

For businesses under 50 employees (where health insurance isn't legally required), Alice outlines various options beyond traditional group plans, including Health Reimbursement Arrangements and voluntary benefits that cost employers nothing while giving employees access to valuable group rates. She explains how self-funded plans provide valuable insights into utilization patterns, allowing businesses to better educate employees about preventive care and other benefits.

The conversation serves as both a wake-up call and a roadmap. If you haven't heard from your benefits broker since your last renewal, you're likely missing opportunities for significant savings and improved coverage. Your broker should be reaching out approximately every six months, not just when it's time to renew your policy.

Whether you're a business owner frustrated with rising premiums or an HR professional trying to maximize your benefits budget, this episode delivers practical insights you can implement immediately. Connect with Alice on LinkedIn or call 1-800-671-7665 to transform your approach to employee benefits from a necessary evil into a strategic advantage.

🎙️ Connect with Chrissy Myers and discover how resilience, expertise, and community can transform your world:

🔗 Follow Chrissy on LinkedIn for behind-the-scenes insights, leadership tips, and updates on her journey as the CEO of two thriving businesses.

📘 Grab your copy of 'Reluctantly Resilient' to learn how Chrissy turned challenges into opportunities and how you can do the same in your life and business.

🤝 Explore Clarity HR and discover how Chrissy’s team simplifies HR for small businesses, giving you peace of mind to focus on what matters most.

💼 Visit AUI to see how Chrissy's employee benefits expertise can help you build a healthier, happier workforce.

Speaker 1:

I never just send stuff because their head's going to pop off. So you just call them, talk to them, see what they're looking for, explain what you're going to send.

Speaker 2:

Health insurance isn't something that everyone thinks is fun, but Alice Rhodes from AUI absolutely thinks it is. So we're going to talk today about benefits and how to be a good insurance broker all the things that are fun about AUI. So, alice, thank you for coming on the podcast today. Thanks for having me. Yeah, so can you tell me a little bit about your journey and why in the world you ever wanted to be a health insurance?

Speaker 1:

broker. So in my prior life, let's see, I started at UI when I was 10. I know Me too, so I've been there 25 years now. So in my prior life I was HR for a department store and it's retail. It's horrible. We had high turnover and I'm like I need out of here. But what works well with HR, well benefits. So I started doing customer service at AUI again when I was 10. Yes, so hard to believe it's been 25 years. It's like where does this go? So it seems like just yesterday, but boy, has it changed. So that's it, and it's always something different. So that keeps you interested, it keeps it interesting and it's yeah, never boring.

Speaker 1:

Yes, exactly.

Speaker 2:

So what's a common frustration that business owners have with benefits brokers and with health insurance in general?

Speaker 1:

Yeah, so it's no secret, health insurance is expensive, so that's always the number one issue. We run into Brokers, especially in small employers. They have trouble finding somebody that wants to work with small employers, and if they do find somebody, that'll do it. They never hear from them. They're going to a call center. They don't ever find a person that they can work with. So that's where we try to be different.

Speaker 2:

So you like being the person that returns phone calls? Yes, exactly. So. I know that for a lot of small businesses, health insurance feels like a necessary evil, like we have to have it. So how do you help small businesses, especially those employers that have less than 20 employees, see employee benefits as a strategic advantage.

Speaker 1:

So in today's labor market, you've got to try as an employer, you've got to try to make people want to work for you, and benefits is a key way to do that. And it's not just health insurance, it's things dental Everybody wants dental Vision. As a vision person, you know it's very valuable to me being able to get glasses and contacts, so you got to kind of put yourself in their shoes too. And things that people don't think about, like life insurance and disability, whether it be short term or long term, because you don't, you always think it's never going to happen to me, but until you, either know somebody that it happened to or it does happen to you.

Speaker 2:

So so what's one mistake small business owners make when they're choosing or managing their benefits? I can think of five. I'm sure you can't too. What's one?

Speaker 1:

Going for the cheapest plan. Okay, tell me why. Sometimes, when it's cheap doesn't mean it's the best option. You know they're just oh, I want that plan. It hits my budget. It's an $8,000 deductible with no co-pays. Well, depending on you know what you do. That's hard to work with, so and your employees don't always understand. They're like oh, my benefits are horrible.

Speaker 2:

So they just look at things a little bit differently. So and your employees don't always understand they're like, oh my benefits are horrible, so they just look at things a little bit differently. Yeah, I would agree, definitely the higher deductible. If you're not educating your employees around what is the right way to manage that plan?

Speaker 2:

or how to use that plan effectively. I agree, going for the cheapest plan can oftentimes be a struggle. Yeah, another one that I would say is let's talk about the, the fear of shopping Like. I don't ever want to shop for my benefits. Yeah, it's complicated and hard. Yeah, and it is.

Speaker 1:

It's. There's a system and it's an electronic application system we use in small employers to be able to shop. Everybody hates it because every employee has to go in and complete it, and sometimes it's like herding cats. Yeah, so they don't do it. They don't want to do it. There's always, you know, usually it's the owner that's the last one to do it.

Speaker 2:

No, never. We don't speak from personal experience. I'm always the last person to fill out form fair.

Speaker 1:

Yes, I'm tracking her down when it's our turn, so it's, and then going through that whole process and then you know what if something doesn't come back. But then at least you know what's going on in your group. So how?

Speaker 2:

do you kind of you walk through the Form Fire process with people. You help them get their applications in you shop. You've got all these quotes. What do you do as a broker to kind of help navigate, steer them in the right direction, make a good decision? Because oftentimes I think people think of their insurance broker, as I've got to fill out this form and then they send me like 10,000 pages that I'm supposed to spoon through and figure out what I'm supposed to do. So how do you make this manageable?

Speaker 1:

Especially some of the small employers. They get these quotes in one carrier. It's an 80 page quote, yeah, so once I get everything back, I never just send stuff because their head's going to pop off. So you just call them, talk to them, see what they're looking for, explain what you're going to send, or explain what you're going to send. Sometimes you can narrow some things out, you know, based on network, or you know their doctor's not there or things along those lines, but you just talk to them and you communicate with them, and then you can narrow it down and say, ok, I'm going to send you these three options that I think are great and go from there. How?

Speaker 2:

much about what you do is understanding the group. Like, do they have kids, Do they have people that are going to be retiring soon? What are they trying to attract what? How do you kind of position yourself and understanding what, what the business?

Speaker 1:

needs from an employee benefits perspective. Yeah, so I like to get to know my groups. So what are their needs, Do they? You hit the nail on the head? Do they have people that are going to be retiring that maybe you know the Medicare? They don't know what to do, they. Some people they start calling 18 months in advance and some people are like, oh, I turn 65 tomorrow, what do I do? So they don't know how to navigate and some of it depends on the employer size. What do they do, Do they? They're confused.

Speaker 2:

So it's always something new every day, yeah, and oftentimes, I think, navigating. When you're a small employer, you know what's going on in your organization, so you know if someone has a health issue or if they've had an emergency, and so you take some of those things more personally and kind of figuring out how they navigate the insurance. So I would think that, as you have those conversations, you're getting some of that feedback. As you know, well, we don't like this hospital system, or we have to make sure that this drug is absolutely covered, because our VP of sales is on this medication and so it has to be affordable for them. So how do you kind of is that continuous dialogue, yes? And kind of helping them figure out what things are, because I would assume that things change all the time.

Speaker 1:

Oh, yeah, yeah, Heck, at the end of every year there's some new contract up with a hospital, with a carrier, and it changes all the time. You know, if you're in Akron and you're going to lose one of the major hospital systems in a network, you got to be proactive, let people know, because they get nasty, they do.

Speaker 2:

And those hospital systems. They send letters to the insurers and their patients. They send those hospital systems and those major doctor's offices. They'll do the same thing. And so you get those. I assume you get those phone calls. Oh, yes, yes, I think this doctor is going to be leaving the network. What do I do?

Speaker 1:

okay, we'll shop at that time yeah, exactly, you've got to be nimble and be able to shop it and you know, sometimes you kind of make a hard decision of do I just wait and see what happens? Um, because normally that stuff settles and it calms down, but you got to be prepared to jump if you need to.

Speaker 2:

So I know that as we talk about, you know, navigating things, one thing that can be a challenge is cost, so I know a lot of small businesses think they can't afford good benefits. So what's your response to that?

Speaker 1:

There's all sorts of different options out there, and we're very fortunate in Northeast Ohio we have 10 different carriers with a whole plethora of options, and sometimes it's, you know, maybe not a group option, but then there could be an individual option available for them as well, because there's different MIWAs, there's self funding, there's level funded and it just kind of depends what you're comfortable with and what makes sense.

Speaker 2:

Yeah, For those in our audience who aren't insurance nerds like we are, what are the requirements for when I have to offer benefits and those types of things Like? Can you give us the thresholds real quick?

Speaker 1:

So, based on the federal regulations, you do not have to offer benefits until you have 50 employees, 50 full-time equivalent employees. So there's some part-time stipulations in there, as well as what counts as a full-time.

Speaker 2:

Okay, so up until then I can put people where or do what.

Speaker 1:

You can do different types of health reimbursement accounts, whether it be a QSE, hra or an ICHRA and those kind of depend. There's also some different things depending on your employer size. If you're under 20, you don't even you don't have to do COBRA 20 plus. So there's different thresholds of. You know what's what your requirements are as an employer. You know what counts, what count. You know is it a half of a person or is it a full person? Sometimes things sound kind of morbid. It's a half a body.

Speaker 2:

So, as you're kind of thinking and planning with a group, you can kind of talk about. You know what are your needs, what are the things that the organization, as they continue to grow and scale, attract and retain people with some of their benefits? But then these these different things that you just talked about, the alphabet soup. They give you different options for different price points, different types of coverages. Yes, definitely Okay. So how's the landscape of employee benefits changed in the last few years? I know we dealt with a lot in the Affordable Care Act.

Speaker 2:

What are you seeing right now as far as trends with where the labor market's going with where the economy's going with where cost of health care is going? So what are things that small businesses should really be paying attention to, and maybe even asking their broker to pay attention to?

Speaker 1:

So there's obviously health insurance. If it wasn't changed, we wouldn't know what to do. And you're right, aca was a big shift in how we did things, trying to think, and then, with the advent of the ICHRA or QSEHRAs, which is the QSERAs, those are things people are starting to look more at, but it really just depends on your group as a broker. One thing I always like to look at is, like I said before, getting to know your groups, keeping an eye on that census. Do they have 15 employees and two of them are getting ready to go on to Medicare? What can we do with them? Will it help the group? Do they stay with the group? Do they come off and go Medicare? What are the rules around that? Because they're all a little different.

Speaker 2:

Are there any big compliance changes you're seeing on the horizon?

Speaker 1:

Oh well that we have a new Department of Health and Human Services director and a new CMS director coming up. So just last week in the spending bill there was about extending telehealth. So it changes all the time and I'm expecting more changes, just not 100% sure what they're going to be.

Speaker 2:

Yeah, and compliance changes too. Too, on reporting for employers, same thing for individuals in ACA dealing with Medicare. I know we've seen some significant changes to broker requirements. Do you want to talk about things that your broker should be doing if they're not doing?

Speaker 1:

Yes, so in the Medicare arena, when you get into Part D plans they all cover different drugs. So in just this past open enrollment there were a ton of changes where drugs that were covered aren't covered anymore. Maybe a plan that was $5 a month is now $30 or it was crazy 30 or it was crazy. So you need that broker, needs to keep an eye on it and find you the most reasonable plan for you.

Speaker 2:

So having a broker that can pay attention, that can understand that you can ask questions too, is really important.

Speaker 1:

Oh, yeah, definitely.

Speaker 2:

Not just in Medicare, but in the small business space as well.

Speaker 1:

Yeah yeah, Small business, individual Medicare.

Speaker 2:

All right, I'm going to ask you some really quick yes and no questions. Okay, ready, all right. Health insurance is too expensive for small businesses, yes or no? No, employees only care about salary, not benefits. Yes or no? No, duh, if I work with a broker, I'll pay more for insurance. Yes or no? No, right, all insurance plans are basically the same yes or no? No, once I pick a plan, I don't have to think about it until renewal. Yes or no? No, all right, I want to unpack some of those One that I think I love but I think people always forget. That is, if I work with a broker, I'll pay more for insurance.

Speaker 1:

So can we talk about that, alice? Why sure? So, especially in small group. The carrier set commissions and you pay the same commissions For one. The carrier won't work direct with you and you pay the same. Whether you work with us or ABC agency down the street, it doesn't matter. So you pay the same whether you hear from us or you don't hear from us, whether we shop you or don't shop you, yes, we get paid the same.

Speaker 2:

So so let's talk about renewal and shopping for a minute. So it's not. I don't think it's something that I told you we're going to talk about, but I want to. And so oftentimes we have groups that go oh, I'll just renew it. It's a 5% increase, it's a 10% increase year over year, and as long as it's under 10%, I'll just keep renewing. Why would you tell?

Speaker 1:

a group that that's not a good idea. Let's face it. Even 5% or 10% of a large number is a large number. So it's not like we have a $200 a month single rate anymore. It's not like we have a $200 a month single rate anymore. We've got some that are $1,000, $1,300, $1,500 or more that they're paying for a single. It never hurts to shop it. It doesn't even have to be on cycle. If nothing else, it lets you know if what you have is a good rate. Sometimes maybe you still don't want to move, but you can always take that market data to your current carrier and say look, this is what the market brings Right. Do you want to keep this group or not? And sometimes they'll drop their rate. Sometimes they don't, but then it's your decision to do what you want to do.

Speaker 2:

So using it as a point of leverage for negotiation.

Speaker 1:

Oh, yeah, definitely.

Speaker 2:

How do you present that to your client and saying I know you don't want to fill out these applications, but it can help and be beneficial. What are some of the cost savings? Can you give us like kind of a story that you've dealt with in the recent past around cost savings?

Speaker 1:

I just had a small employer, 20 employees. They had again been with an agent that they had continued to just take the increases on. They were on an old grandmother plan, so it was $3,000 deductible 80, 20. After that we were able to shop it, move them to a $500 deductible with a new carrier and save them 20% off of their current rate. Wow, Before even the renewal.

Speaker 2:

So much richer plan Mm-hmm, much cheaper rate Just because of competitive data. Exactly, wow, yeah, so tell us about a time when a business owner came to you overwhelmed by insurance and you completely turned things around for them. I think you do this all the time. So I think I do it and don't even realize I do it.

Speaker 1:

So again, you know insurance is complicated. Nobody ever likes to see me coming. You know, back during when employer reporting came out I kind of joked. I had this black wool coat and if it had a hood on it I looked like the Grim Reaper when I was coming. So I'm trying to think different situations.

Speaker 1:

One of our co-groups with Clarity had kind of reached a size. They had gotten 15 20 percent increases again year over year. Didn't know what was going on in the in the group. They're like oh, this is horrible. You know everybody's healthy. Why are we keep getting these 20 percent increases? We were able to shop it, moved them to a self--funded plan, totally changed how they do things. Now they get reporting, they know what's in there. They know that part of the group doesn't get their preventative care. So they've been able to change some education, make sure those employees are getting their preventative care done. So it kind of changes some things on that education side, because you can go in and tell people oh, you know you need to do this, but everybody could be doing it.

Speaker 2:

But at least you know what you need to educate them on, especially when you can see the numbers on the side. Oh, yeah, yeah, definitely, definitely so. If a business owner is listening, they're wondering whether they have the right broker or not. What's one question they should ask themselves when was the last time they heard from them? Oh, and if it was renewal? That's not the right answer. How often do you like to talk to your organizations that you work with?

Speaker 1:

In a perfect world if there's no dumpster fires about every six months Okay, Sometimes a little more depends on what's going on in the group. About every six months, Sometimes a little more depends on what's going on in the group.

Speaker 2:

Sometimes there's a dumpster fire and you need to touch base a little more often, so they've got challenges, maybe quarterly. And then also do groups reach out to you throughout the year.

Speaker 1:

Oh yeah, Constantly Okay.

Speaker 2:

Constantly so. If a business owner could take just one step today to improve how they handle their health benefits, what would it be Call me? I like that one too. What else Like? Let's say, they're in Montana and we're not licensed in Montana?

Speaker 1:

We could get licensed in Montana. Yeah, we could get licensed in Montana. What would?

Speaker 2:

you tell them, then, about how they can handle their health benefits? What's a step they can do to improve it?

Speaker 1:

Make sure they talk to their broker or, if they don't have one, find a new one. Yeah, and there's also benefits they can offer that don't require any funding out of the employer. There's voluntary benefits oh, talk about that for a minute. So there's a ton of different. We call ancillary benefits so voluntary life life insurance. They can benefit from a group rate and possibly get a plan less than they can get on their own. It's payroll deducted. The employer doesn't have any cost out of their pocket. It's totally funded by the employees. You can also do that with dental, vision, disability, cancer plans. There's all sorts of accident and working with a broker enables you to have access to those types of things and not vision, disability, cancer plans. There's all sorts of accidents.

Speaker 2:

And working with a broker enables you to have access to those types of things. Oh yeah, you don't have to worry about finding them yourself, exactly, all right, where can people connect with you?

Speaker 1:

Easiest place is on LinkedIn, or, if you're not on LinkedIn, call me. So our 1-800 number is 1-800-671-7665.

Speaker 2:

All right, and the last thing we do. It's the question we ask with every podcast is what do you think a business leader could do to get 1% better in their business today?

Speaker 1:

Oh, Call me. I agree, call your insurance broker or call Alice because she should be. If you have employees, make sure you communicate with them, make sure you let them know what's going on and just talk to them. Find out what their needs are.

Speaker 2:

Yeah, especially around benefits. I think oftentimes the employees forget that benefits are something that is at the cost of the employer too, and oftentimes the employer well, not oftentimes, almost always the employer is paying more for the benefits than the employee is. They should be, at least, because that's the rule. Yes, yeah, alice, thank you for your time today on the podcast.

Speaker 1:

Thanks for having me.

Speaker 2:

I look forward to we're going to have more of these conversations and more insurance learning. Thanks, a lot Thanks.