a strategic model for product diversification and broker revenue enhancement
TRANSCRIPT
Realigning the Client Relationship
A Strategic Model for Product Diversification andBroker Revenue Enhancement
Southwestern Risk & Benefits Group, LLCA Strategic, Organizational and Operational Consulting Practice
Southwestern Risk & Benefits Group, LLCA Strategic, Organizational and Operational Consulting Practice
Southwestern Risk
Consulting practiceBroker-drivenStrategic planningRevenue enhancement
Southwestern Risk & Benefits Group, LLCA Strategic, Organizational and Operational Consulting Practice
What we do
Help brokers identify opportunities
DiversificationProduct expansionStrategic partnership development
Southwestern Risk & Benefits Group, LLCA Strategic, Organizational and Operational Consulting Practice
Central focus
Unlocking new profit centersLeveraging existing relationshipsDemonstrating value
Southwestern Risk & Benefits Group, LLCA Strategic, Organizational and Operational Consulting Practice
The BeginningsBroker-sponsored vendor audits
Operational infrastructure (platform, succession, business continuity/disaster recovery planning)Also reviewed client purchasing patterns
DiscoveredClient plans purchasing multitude of servicesFees averaged 45% of admin fees (med, dental)
Medical bill repricing, Pre-cert, PBM, WellnessEach product provides TPA stream of revenueNo additional responsibilities
Southwestern Risk & Benefits Group, LLCA Strategic, Organizational and Operational Consulting Practice
Analysis Efficient distribution of labor
Broker sells, administrator servicesBut at what cost?
Competition for client relationshipEffect on retention/customer loyaltyQuestions of relative value and expertiseWho leverages the relationship for maximum financial advantage?
Southwestern Risk & Benefits Group, LLCA Strategic, Organizational and Operational Consulting Practice
The reality
The TPA received substantial fees for placement of business with vendors, not servicing the account.
Southwestern Risk & Benefits Group, LLCA Strategic, Organizational and Operational Consulting Practice
Strategic Response
Reaffirm primacy and expertiseExpand product mixDiversify revenue stream
Southwestern Risk & Benefits Group, LLCA Strategic, Organizational and Operational Consulting Practice
Reinforce primacy
Broker as trusted, valuable advisorBroker as owner of relationshipBroker as expert on product and service offerings
Southwestern Risk & Benefits Group, LLCA Strategic, Organizational and Operational Consulting Practice
Diversification
Broker-driven products and servicesPlans already purchasing Opportunities for increased “same client” sales
Southwestern Risk & Benefits Group, LLCA Strategic, Organizational and Operational Consulting Practice
The plan
10,000 livesIdentify opportunity
Easy to implementNo disruptionNo increase in costs
Southwestern Risk & Benefits Group, LLCA Strategic, Organizational and Operational Consulting Practice
Turn-key operation
We provided:Strategic partnersContract administrationVendor management
Southwestern Risk & Benefits Group, LLCA Strategic, Organizational and Operational Consulting Practice
The results10,000 lives being placed with broker driven service vendor
Easy to implementNo client disruptionSame service level$.50 PEPM$60,000 in revenues
Southwestern Risk & Benefits Group, LLCA Strategic, Organizational and Operational Consulting Practice
Follow UpTalk about other opportunitiesGoal of “same client” revenues increase by $1.50 PEPM$180,000 annually
Southwestern Risk & Benefits Group, LLCA Strategic, Organizational and Operational Consulting Practice
Not just about dollars Re-establishing primacyDemonstrating value and expertiseAccess to new products and servicesDiversifying revenue streamsBuilding a new model
Broker places businessTPA administers plan
