Benefits Business

Speeding up the proposal process

BenefitPoint expands its partner network to enhance services for agents

By Len Strazewski

Information drives sales in the world of employee benefits, and the agent or broker who can respond fastest with the most well-detailed proposal will generally land the new accounts.

But managing employee benefits information has become increasingly challenging with the evolution of consumer-directed health plans, greater access to self-funding mechanisms and new competition from financial service firms.

Even the largest employee benefits brokers need data tools and broad-based access to industry and client information if they are going to compete successfully, says Ross Reda, chief operating officer of Lockton Benefits, the employee benefits division of Kansas City, Missouri-based Lockton Companies, LLC, one of the largest independent insurance brokers.

Lockton Companies, which has 18 U.S. offices and an extensive international network, operates six employee benefits offices generating about $115 million in revenues—about one-sixth of the corporate total.

And the bigger the employee benefits operation gets, the harder it is to keep track of present and prospective clients, their unique needs and the insurance companies and other vendors that provide services they require, Reda notes.

“We opened our sixth office in 2000 and as our employee benefits business grew, it become clear to us that we had a real need to manage our client data across our national offices and our various carrier relationships in the benefits sector,” he explains.

The company became an early adopter of Aptus HR, an employee benefits agency management system from BenefitPoint Inc., in Boulder, Colorado, which allows the benefits brokerage to track client information from each office in a single centralized database and use the information to develop proposals for present and prospective clients.

“The platform originally came to market as a procurement tool for brokers but, in general, the software makes a benefits broker more efficient,” Reda says. “BenefitPoint developed a product that leverages the information that brokers acquire as part of their regular client management and integrates that data with enrollment information, carrier data and information about service vendors.”

BenefitPoint is a division of Vertafore, Inc., an insurance industry software provider that specializes in products for agents and brokers. The BenefitPoint division markets two agency management data products for employee benefits. One is Aptus HR, a Web-based benefits management and procurement system with account and plan management, business intelligence, and comprehensive revenue tracking. BenefitPoint’s other offering is ClientConnect which allows agents and brokers to deliver private branded client and employee benefit communications portals with custom documents and a library of human resources compliance information and resources.

The Aptus HR system, which can be integrated with Vertafore’s AMS line of property/casualty agency management systems, is used by more than 340 agencies and consulting firms and has more than 32,000 individual users, according to Joseph Thomas, vice president of enterprise sales in BenefitPoint’s Minneapolis office.

ClientConnect, announced last year, allows human resource clients to provide employee benefits self-service tools to employees and plan documents, including forms, policies, checklists, and employee handbook information. The reference material is provided by SilverPlume, a Vertafore company.

The Aptus HR product continues to grow and mature, tracking trends in the employee benefits business, notes Thomas. In November 2007, BenefitPoint added two third-party administrators (TPAs) to its online data partners that already included five online enrollment firms: Acclaim Benefits in Minneapolis and FCE Benefits Administrators, Inc., in Washington.

Under the agreement, the two TPAs will directly provide BenefitPoint customers with tools and information about their products and services within BenefitPoint’s Aptus platform.

Acclaim Benefits will feature national flexible administrative solutions for flexible spending accounts (FSAs), health reimbursement arrangements (HRAs), transportation, health plan continuation (COBRA) and retiree medical billing.

FCE Benefits will focus on health and welfare plans for government contractors, including plans for employees covered by Service Contract and Davis-Bacon Acts, collective bargaining agreements and living wage ordinances.

As BenefitPoint partners, both TPAs will be able to post messaging, marketing information and announcements on the Aptus broker home page and pre-load information into Aptus for immediate access and fast Request for Proposal (RFP) fulfillment.

“Agents and brokers are finding it increasingly difficult to differentiate themselves in their marketplaces,” Thomas notes. “And, they are forced to work with a broader range of service providers, including their carriers, benefit enrollment firms and administrators.”

The new partnership additions allow agents and brokers to bring their client data together with the service capabilities of the TPAs and enrollment vendors for a consolidated employee benefits delivery proposal. “Users will be able to allow their clients to compare plan designs and service options in an online proposal that consolidates specific vendor information with the needs of your clients,” he says.

Acclaim Benefits President Jeffrey Ackerson says the partnership agreement was a natural step for the administrator. “We have already been using the Aptus system for our own client management within our organization,” he explains. “Now by posting our product information online, we will be able to assist our agent and broker partners in preparing proposals faster than ever before.”

Ackerson says agents and brokers will be able to draft a standard proposal using Acclaim Benefits information and services in a day or less and develop a custom proposal that responds to specific client needs and requests in a matter of a few days, cutting and pasting information available online.

“The health services business has become increasingly competitive with the growth of Health Savings Accounts,” Ackerson says. “Banks and financial service firms have made aggressive entrees into what had previously been the exclusive territory of health plans and TPAs and their partners, the agents and brokers.

“In order to compete effectively, agents and brokers will have to respond more quickly with more detailed information and perform the due diligence on behalf of their clients,” and by having online access to specific service information, agents and brokers will be able to expedite their response to clients, he says.

Reda of Lockton Benefits agrees. “Over the period of a year, we do a number of deals involving an online procurement process. Having information about experienced administrators available online and integratable with our own system can be quite an asset.

“One of the most difficult areas in our industry has been data integration and form standardizations,” he adds. “It took years for ACORD to bring standards to the property/casualty insurance field, and now our industry has been struggling with benefits information.”

Reda says he expects a steady improvement in employee benefits data integration but, until the industry can agree on forms and standards, agents and brokers need to rely on ad hoc arrangements between vendors and agency management software providers to create integration opportunities that can help leverage their increasingly large and complicated databases. *

The author
Len Strazewski has been covering employee benefits issues for more than 20 years and is employee benefits editor of Human Resource Executive magazine. He has an M.A. in Industrial Relations from Loyola University.