Cross-selling to survive health reform

How has the prospect of health care reform affected your business? Like most of us, you’re probably already feeling the impacts. Recent legislation has and will continue to have sweeping effects on our industry.

Changes aren’t coming just to the products and services we offer, but to our bottom lines, as well. Anecdotal data suggests health insurance commissions could be cut by as much as 60 percent in order to make room for mandates associated with health care reform.

Already, health care reform is changing benefit plan designs. For one, the legislation includes up to 85 percent in mandatory loss ratios for certain group health plans. In their “Request for Comments Regarding Section 2718 of the Public Health Service Act (medical loss ratios),” the federal agencies involved with the health care reform legislation, implementation and oversight request insight from the industry consumer groups and the general public as to how minimum loss ratios should be calculated. This is available online at

While many questions remain about how health care reform will be implemented and how the regulations will be written, it’s clear employers will be seeking new benefits alternatives, consumer involvement will continue to increase, and carriers impacted by the legislation will seek to maintain their profit margins while reducing certain expenses, including distribution costs. Thus, many brokers will find their traditional revenue streams challenged, and will need to change their established business models in order to adapt to these new realities.

How are we going to survive – much less thrive – in this new reality of regulatory and legislative change? Traditionally, some of us have addressed this through service differentiation rather than offering alternative product solutions.

Now, in addition, we’re going to have to offer innovative product options to our clients to help them cope with benefit challenges. A great place to start is with our existing clients through cross-selling.

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