Savvy business owners often find success by zoning in with laser-focus to provide an exceptional product or service. On the flip side, this level of focus can also lead to blindspots when it comes to managing things like OPEX. John Clay, best-selling author and founder of BetterSource, explains.
“Throughout my years as a C-suite adviser, I’ve found that employers get really good at optimizing things like the SOPs and supply-chains which are necessary components for success. First thing we do as advisers is encourage execs to take that train-of-thought into other high-spend areas.”
For many U.S. companies, healthcare is the second largest expense but somehow sidesteps real examination. This, however, is by design. Insurance carriers have created a scenario where employers don’t have leverage when it comes to rising premiums. Without access to cost breakdowns, employers aren’t really armed to negotiate. Clay comments.
“It’s an intentional tactic that brokers don’t want employers to look behind the curtain – that would take away almost all their leverage. That’s a big part of what our advisers do for larger groups and it instantly changes the conversation. We make it about the data, and more often than not, the numbers suggest that premiums are dramatically over-inflated.”
This raises the question, if an employee group’s overall spend was less than projected, is it possible for a renewal decrease or partial refund? Clay responds.
“While carriers would want you to believe that this is unheard of, it’s actually common depending on plan design. We have clients that have come to expect a refund of unused premiums each year – they’re called surplus checks.”
Don’t feel too bad if you haven’t been offered a surplus check. Carriers and brokers would rather you are unaware that such a thing exists. Clay believes this is one symptom of a fundamentally broken healthcare system because insurance carriers’ interests are not aligned with their participants. Carriers operate in the best interests of their shareholders while brokers essentially work for higher commissions as your rates increase. Ultimately, all of this leaves employers and participants without a true advocate. Clay’s main takeaway.
“It can be tough to navigate but the good news is there’s a huge opportunity sitting there waiting in your healthcare spend. Capital that can be used to boost profits and provide better benefits for your employees. Best thing to do is get someone to sit on the same side of the table as you – an adviser whose interests are actually aligned with yours.”
For best results, find an adviser with a proven track record. John Clay’s firm, BetterSource, provides detailed case studies as seen here, https://bettersourcebenefits.com/results. BetterSource also offers a success-based compensation model to qualifying organizations so that clients pay based on savings. Can’t get any more aligned than that.
About John Clay
John Clay is a best-selling author and founder of BetterSource, a consulting firm dedicated to converting OPEX into competitive advantages for U.S. businesses. More information can be found at https://bettersourcebenefits.com/.