We sold a group health plan but we tried our hardest not to………….
You’re probably wondering why on earth would we try our hardest to unsell a risk management strategy proven to work, lowering costs and improving benefits at the same time. As with any strong medication, our strategy side effects include immediate onset of high level stress among plan members and an epidemic of headaches in the HR department. (Both conditions are treatable with recovery times ranging from 6 months to a year dependent upon the mental health of the patient).
The “patient” in this case is a Texas school district. Do I need to say more?
School districts are high maintenance, demanding extraordinary efforts to please everyone all the time. Political tides wax and wane. Disgruntled plan members routinely run to board members for help. Board members then demand action of staff, staff then demands action of the plan administrator who is often admonished to make exceptions. Exceptions become the norm. No one is happy. Strong administration leadership is commonly lacking. Superintendents operate in fear of their board but try their best not to show it. The bad guy is always the insurance company.
Plan members are known to use social media platforms to point accusatory fingers highlighting their anger and frustration with their health plan. “ABC Insurance Company denied my claims and I’m gonna die if I don’t get treatment!“. Or “Our agent lied to us, he didn’t tell us we were ultimately responsible for a pre-cert call.” You get the picture…………..Reputations are ruined.
We vetted the prospect, meeting with them at their invitation. We quickly knew they were not a prospect for our strategies. Instead they were welded to status quo solutions and were not about to spend valuable administrative time and effort necessary to assure plan success. “Unlike ABC School District which you manage and all the time and effort their superintendent has devoted to their plan, my staff and I don’t have the time nor the desire to do that” said the superintendent.
That was months ago. In the interim this district went to public bids and we thought we had heard the last from them. Then they called us. “Is your plan still available at this late date” asked the business manager.
We learned they received many proposals and didn’t like any of them. “They are too expensive. We like the plan you put in at ABC School District. Can we join that plan?”
So we put on our Negative Selling Hat turbocharged with an overdose of high octane caffein and explained…………….
“We could do that but don’t recommend it at this late stage. The rollout would be rough. No time to educate staff and plan members properly. You would have to agree to our risk management strategies without exception. We must have 100% of all full-time employees covered (they don’t now). Not all providers will accept our insurance. Plan members may have to change doctors. We won’t cover certain expensive drugs including weight loss drugs everyone is talking about. Your employees will be in an uproar over all of this. They will raise hell with your board. It will get unbearably nasty. Our management fees are in addition to all other plan costs. We require all the district’s voluntary benefits too. Our stop loss is not firm, we need more information. You will be assuming risk whereas you have never assumed risk before. We don’t use a network of hospitals and doctors. We segregate risks within your population. There may be high risk individuals within your group that will be lasered which increases your risk even further. Plan members, for the first time, will have to assume individual responsibility in seeking the care they need which goes against the increasingly common American entitlement mentality.
Despite all these forewarnings they choose our program. They were focused on low rates and nothing more.
Years ago a good friend of ours who worked for a national insurance company captured the Harlingen Independent School District account in a competitive bid situation. The district had been with Blue Cross since the beginning of time. It was a nice sale for Albert.
Our office was blocks away from the district administration building and Albert would come by to visit from time to time after meeting with district officials.
“They are giving me a hard time Bill! They say ‘Blue Cross did it this way or that way why can’t you!’ My staff is not happy, taking abuse from pissed off school employees. I wish we had never written this group!” Albert cried.
Ten months into the plan year Albert came bouncing in our office with a gin on his face. “Bill, let’s go get a beer and celebrate! I just fired Harlingen Independent School District!”
“Whaaat!” I said. “What happened?”
“I delivered a non-renewal notice. I told them they aren’t happy, we aren’t happy so let’s part ways and both be happy!”
“Albert” I said, “They bought low rates. That’s all they cared about. And, it looks like the district lacks strong leadership otherwise district officials would have told plan members to suck it up, this is the way it is, and if you don’t like our plan you don’t have to take it.”
We will soon see if our new client has the appetite and strong leadership required for plan success.
