Five questions to ask your broker before you sign the renewal.
Most employers can say what their plan costs. Far fewer can say where the money went — and that gap is where renewals get decided without anyone really deciding anything. Whoever handles your benefits should be able to answer these five. The quarterly review in our health and cost strategy answers several of these before the renewal arrives.
What a good answer sounds like.
None of these are trick questions. A broker who is doing the work will have the answers ready, usually with the numbers behind them.
For the wider checklist, see what to look for in an employee benefits consulting firm, or, for groups under 50, how to choose a small business health insurance broker.
What Specifically Is Driving Our Increase?
A good answer takes the percentage apart: medical and pharmacy trend, your own claims experience if your group is large enough for it to count, changes in age or enrollment, and anything the carrier has added for risk. “Trend is up” is not an answer on its own.
How Do Our Benefits Compare to Similar Employers?
Comparable means your size, your industry and your region, not a national average. You should hear where you sit on premium, deductibles and the share employees pay, and what that means when you are trying to hire. Ask how the comparison group was chosen and how large it is, because a benchmark built only from a broker’s own book can flatter the plan that broker placed.
What Claims or Utilization Trends Should Concern Us?
Where your group is large enough to receive claims data, someone should have read it: high-cost claimants, pharmacy growth, emergency-room visits that could have been urgent care. Where it is not, you should hear what the pool you are rated in is doing instead.
What Alternatives Did You Actually Investigate?
Not “we shopped it.” Which carriers, which funding arrangements, which plan designs, and why each one was or was not a fit. The options that were ruled out tell you as much as the one that was recommended. Ask to see the quotes themselves rather than a summary, including any carrier that declined to quote and the reason it gave.
What Can We Do Before Renewal to Improve Our Position?
The best time to change a renewal is months before it arrives: contribution strategy, plan design, pharmacy management and the data you ask the carrier for. If the only conversation happens when the rate lands, the options are already narrow.
Quoting a plan and understanding one are different jobs.
We do this analysis for every client. Most brokers don’t — and it’s the second job that moves the number.
The Renewal Is an Opening Position
A carrier’s first offer is a starting number, not a verdict. Knowing what is inside it is what gives you something to negotiate with. The parts most open to negotiation are the carrier’s assumptions: trend, the credibility given to your claims, pooling charges and retention. A challenge backed by your own numbers on any of those has something to anchor it.
A Team on Every Account
For proper coverage of an account we work in teams of five: an account executive, an account manager, a plan analyst, customer service and IT. Each seat covers a different part of the renewal, so the analysis behind these five questions is done by the plan analyst, not squeezed in by whoever answers the phone.
Independent
No carrier owns us or sets the recommendation, so the answer to “what else did you look at” is a real list. It also means the recommendation can be to stay with your current carrier, or to change the funding rather than the carrier, when that is what the numbers support.
The questions to ask before you hire, or keep, a broker.
Ten more for HR leaders comparing firms, with what a good answer sounds like.
How do you get paid on our account, and will you put it in writing?
For group health plans, federal law now requires a broker to disclose in writing, before the contract, the direct and indirect compensation they expect to receive. Ask for it at the start, not at renewal. Our page on how benefits brokers are paid explains what to look for.
Which carriers will you take our plan to, and will we see the declines?
Ask for the list before the market work starts, and the written quotes and declinations after. A broker who only shows you the winner is asking you to trust the process instead of showing it. A second opinion on your renewal asks the same questions of a renewal already on your desk.
Who will actually work on our account day to day?
Meet the people, not just the person who sold the relationship. For proper coverage of an account we work in teams of five: an account executive, an account manager, a plan analyst, customer service and IT.
What happens when an employee has a claim problem?
Ask who the employee calls, how fast they hear back, and whether someone will work the claim with the carrier or just pass along a phone number.
Which compliance deadlines are you responsible for, and which are ours?
Form 5500, 1095-C reporting, Part D notices, the gag clause attestation and COBRA notices all have owners. Get the split in writing so nothing falls between you.
Are you independent, or does a carrier or a larger firm own you?
Ownership shapes recommendations. An independent firm has no carrier to favor; a firm owned by a larger group may have preferred partners. Either can work, but you should know which you are hiring.
Can you show us how you handled a renewal like ours?
Ask for a redacted example: what the carrier first asked for, what was questioned, what the market returned and where it landed. The method matters more than the headline percentage.
What do you need from us each year, and how do you protect it?
A census, the renewal, contributions and, at 50 or more employees, claims experience. Ask how it is stored, who can see it and whether they will sign a confidentiality agreement.
How do you help employees choose a plan at open enrollment?
The best answer includes a person employees can call to talk through which plan fits their situation, not only a benefits guide and a link to an enrollment site.
If we change brokers, does anything change for our employees?
No. A broker of record letter moves the servicing relationship, not the plan. Coverage, carrier and ID cards stay the same unless you decide to change them.
Ready? Send us your renewal, or talk it through with someone first. No cost, no obligation.
General information about choosing a benefits broker, not legal advice. Plan-specific questions belong with ERISA counsel, and we will bring them in.
Send us your renewal.
We’ll tell you whether it looks competitive, where we see opportunity, and the five questions we’d put to your carrier. No cost, and no obligation to move anything.
The renewal letter
Your current plan summary
Contribution split by tier
Enrolled counts by tier
Four documents — two more if your group is 50 or more. Nothing else; every extra one is a reason to postpone.
An independent employee benefits consulting firm. We look at the entire benefits program — cost, plan performance, risk and administration.
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