If you were going to have surgery, how would you go about picking your surgeon? Would you call up several surgeons and ask them questions, would you ask for referrals from your family doctor, or ask family members or friends about who they think is a good surgeon? All of these sound reasonable, but how do you really know who is the best?
Or, would you first pick the hospital where you will be having the surgery and then see what surgeons have privileges there? Probably not the best way to proceed.
Over the years I have found that employers select their broker or consultant much the same way. They look for a large insurance agency or consulting firm first, and then ask who will be on the team. They sometimes think bigger is better, and all the people that come with the firm are experts.
The reality is that employers are only going to be working with 1 or 2 individuals from that firm throughout the plan year. Those individuals may or may not be qualified “surgeons” but rather “generalist” employees who lean on others to handle the more sophisticated issues and procedures.
I’ve seen plenty of broker RFPs over the years, and the vast majority of the RFP questions are focused on the firm or agency. They may ask for a biography for some individuals, but they’re usually filled with those who may not actually be working with the employer.
My opinion and experience would be to select my actual surgeon first, and then find out where he or she has admitting privileges. After all, the surgeons are going to be doing the operation – not the hospital. Consulting is a people business, and people like to do business with those who they like and trust. Employers are not doing business with the consulting firm or the insurance agency – they are working with people.
My “surgical” business is one that relies on my vast and intimate knowledge of healthcare and health insurance. As you may have read in my prior articles, I am a huge proponent of unbundled, partially self-funded health plans – not BUCA (Blue Cross, United, Cigna, Aetna). Many smaller “operations” (no pun intended) like mine have outside resources that rival or exceed the programs, quality, value, and knowledge that larger firms suggest that they have internally.
Brokers and consultants who maintain the status quo by working with the BUCAs are not really providing individual expertise, they’re simply relying on those insurance companies to provide the services. The broker basically quotes plans and acts as a middleman. An employer could go direct to BUCA, cut out the middleman and save themselves a substantial commission or fee.
In my seminars I asked the audience “When was the last time your broker or consultant gave you ideas that could save your company between 25 and 40%?” After a long pause, someone will answer “Never.” I respond “Right. Why is that? Is it because they don’t have any ideas, or is it because they don’t want to give you any ideas? If they don’t have any ideas you better find yourself another broker, and if they don’t want to give you ideas, why is that?” At which point someone will respond “Money!” The reality is again that brokers want to maintain the status quo because they get paid handsomely. Check out this article from ProPublica.
Whether you are considering a change in your broker relationship, now or in the future, I would strongly suggest you interview the surgeon first, rather than the hospital. This will enable you to get the best outcome, value, and savings that you couldn’t achieve just by interviewing the hospital. If you want to interview me, you can call me at 970-349-7707 or email me at [email protected] 