Insurtech Building Blocs Podcast

Changing the Way We Fund Group Health Insurance with Mike Bechtol

In this episode of the Insurtech Building Blocs podcast, host Cory Schmidt and guest Mike Bechtol from Bravo Health Partners discuss the challenges of employer health insurance, particularly in light of rising costs. They explore alternative funding models, such as level-funded and self-funded group health plans, the intricacies of reference-based pricing, and the importance of data in managing healthcare costs. The conversation also highlights the significance of employee benefits in attracting talent and shares success stories of businesses that have effectively navigated these challenges.

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Insurtech Building Blocs Podcast: Changing the Way We Fund Group Health Insurance with Mike Bechtol

If you're curious about the Insurtech landscape and how the movers and shakers of the industry are progressing, join host Cory Schmidt, Co-Founder & CTO at AgencyBloc, on Insurtech Building Blocs each month, available everywhere you download your favorite podcasts.

Insurtech Building Blocs is presented by AgencyBloc, the #1 Recommended Insurance Industry Growth Platform serving the benefits and senior market space with 6,500+ customers across multiple solutions within the platform. With a range of insurance-specific solutions for sales enablement, client and policy management, compliance management, quoting and proposals, and commissions management — all with highly recommended customer support — we've got you covered.

Transcript for the Episode

Note: CS denotes Cory Schmidt, and MB denotes Mike Bechtol.

CS: Hello everyone and welcome back to another episode of the InsureTech Building Blocs podcast. I'm your host, Cory Schmidt, and I'm excited to be joined by my guest today, Mike Bechtol, who's from Bravo Health Partners. Mike is partner and VP of client experience. Thanks for joining the podcast, Mike.

MB: Yeah, thanks Cory. Thanks for having me.

CS: Glad you're here. All right, so let's dig in. know we're gonna talk about predominantly, I think a lot of the alternative funding models that are available to employer groups. There's been obviously a year over year increase of 12 to 15 to 20 % coming through on group plans. As a business owner myself, I know this is my least favorite time of the year. We're recording this in the fall, which is on the front end of open enrollment. And so we're...

about to get our increases coming through from our friends, the carriers, right? In terms of like what we're gonna be facing in terms of the step ups and change. maybe before we dig into that and the model that you and the Bravo Health Partners team has built to help with that, please share a little bit about yourself, maybe how Bravo got started and what you all's mission is.

MB: Yeah, so I've got about 13 years background in health insurance. helped build two captive insurance companies really designed to combat the increase in health care, right? And make it more affordable and accessible. And I'll talk about some of this with the questions I know we'll get to. And that was at a different carrier. I came over to Bravo this year in January really because I wanted to be able to help

more brokers, more businesses, more advisors with the solution that we know is becoming, like you just said, right, business owners coming into this time of the year, this is what they're thinking about. And I heard a great quote, I was listening to a talk today and it said, it's not that business owners are stingy, they're not spending less, they're actually spending more than they ever have on health insurance. And a lot of them just don't know that there's a different way or an even better way to look at the solution.

CS: Yeah, makes complete sense. think the, know, I've been an entrepreneur, business, a business owner for a lot of years now. And it literally is like the least controllable, least controllable, least favorite part of the year is when this comes through. I mean, you don't have other expenses that just magically go up by 20 % every year. Like that doesn't happen in other, you know, and you have almost no way of controlling it. So excited to dig in about how you and Bravo are helping to control that.

CS: Looking at your bio, the mic, I see you also have a background in golf. that right?

MB: Yeah, I was a golf professional for about 16 years. And as I mentioned, it's a topic I'm happy to talk about. I love I love golf, love talking about it. Grew up with Johnny Miller's family. So if you guys know Johnny Miller, he was the US Open champion and the British Open champion. And so had the benefit of one of his sons is one of my best friends and caddied for him for a number of years and was able to pick it up myself. And I was more of a

CS: worse.

MB: an assistant golf pro on the club side. I, but I, I got to play in some tournaments and teach some lessons and definitely a fun, a fun industry for sure. But a lot of weekends, a lot of holidays and with a family, you know, that, that, that's tough. So.

CS: Yeah, I imagine the work life balance is a little bit better in this business than it was in the golf business.

MB: Yeah, and you still get to play golf too.

CS: Yes, right. Yes. Well, we won't, we won't go into my challenges as it relates to the, you know, the four times I got out this year and why my draw turned into a duck hook every time, but maybe, maybe on a different channel, we can catch up Mike on that. All right. Well, let's dig in. So maybe for the folks that are listening that are not familiar with, you know, level funded, self-funded funding models for employer benefits, help explain, you know, what

MB: You

MB: There you go, yeah. Absolutely.

CS: what Bravo does and how it helps employers control costs.

MB: Yeah. So the main thing is to understand the fully insured, like a fully insured product, they've bundled everything together. And as business owners, we have to understand most of the time that's not in our best interest. And there's there's times when a fully insured plan works great and it fits great. And you're to write that check and you'll probably get the experience that you pay for. But most of the time, that experience is going to cost a lot more. Businesses now, typically businesses that had 500 employees or more.

already looked at self-funding and they're probably in some sort of self-funded model. With innovations though and the way underwriting is done, the way we can steer people to the right care, care teams, cost containment efforts, communities getting involved, we've got plans that now go down to as small as two where you can do a level-funded offering. Most of the time, businesses that are in that 50 to 100 should be looking at a level-funded model. There was a report

put out by McKinsey that said by 2030, 12 million employees will be moving from a fully insured model with their employers and going to a level funded or a self-funded model. And that's a huge change. 70 % of employees in America depend on their employer for their health insurance. And you just said you're looking at it for your team. They depend on that. with, again, you mentioned just the rising cost year over year. It becomes just.

unmanageable, right? And business owners are throwing their hands in the air. Brokers sometimes are going, I know we need a better solution. What's out there now? More than ever, there's so many solutions, right? And so the level funded, self-funded is now taking that fully insured package, unbundling it and putting it back together in a strategic way that makes the most sense for not just the employers money wise, right? But actually a plan that people can use. So a business, the employees now can

actually have access to healthcare. There's a stat, it's like, you know, out of those employees, very few have more than $1,000 in savings. Yet most of the plans out there have more than $1,000 deductible and definitely more than $1,000 out of pocket. So a lot of these plans that the business owners put in place, because they look affordable, become unusable for an employee because they don't have the money to use them.

CS: Right. Yeah. I know one of the strategies, you know, we've had to use it as a business over the years is, know, increasing the deductible or, you know, change, changing the benefit design in order to basically curb those costs. Because I think, you know, even in the past few years, I think we had years where it was, it was 20 plus percent increase. And obviously we can't pass that onto our, onto our team. can't completely absorb that as an organization. And so we've had to get creative with the, you know, the design of the plans, but

MB: Yeah.

CS: It seems like there's a limit to what you can do there. Like you can only, you know, increase the deductible so many times and then it becomes to the, gets to the point where it's not beneficial to have those benefits or they're not rich enough to make a difference. I'm curious about the, the unbundling comment. So when you think about a level funded product, what are we unbundling at the, at the insurance level or at the employer group level?

MB: Yeah, the biggest piece is going to be the networks, right? So the carrier networks, have these pre-negotiated prices that tend to be, 800, 600, 500 percent of what Medicare would pay. And so that's where you're seeing a lot of the increases in price from is because you're protected from that in the sense that you know you're never going to pay more than the contract, but you're never going to see what that contract is. And it's going to be eight times what Medicare pays.

So if you take that piece out and you can either do a level funded network, so you can buy a network that you can put in there that has lower rates, or you can do reference based pricing. And that's going to scare some people because there's some potential for balance bills and things like that on the back end. But that's where you now put the pieces on the back end to protect the employee. The employer will be protected in their summary plan document for many charges, but now the employees become at risk.

But that's where that care team and the steerage really matters. lot of these plans now are going to have a tier one benefit where me as an employee can actually have no deductible if I go to a tier one facility because they've got a pre-negotiated reference based pricing in place, that RBP in place. And because of that, it'll reduce my out of pocket costs because the employer's plan now, my company's plan is going to pay significantly less. So they just waive my portion of that out of pocket.

That's a strategic move. It's the biggest needle mover, right? Is the hospitals. The second or close to the first is gonna be the drugs. So separating the, like getting specialty drugs where you're gonna take advantage of manufacturers assistance programs, patient assistance programs, even international sourcing. I give you source from Canada. You can take a $7,000 drug and get it to $1,000. We'll provide that to the member for free strategically. And the plan's gonna save money.

the member's willing to do that, right? If I called you and I said, hey, Cory, are you open to seeing if we can get this drug for you for free? Or maybe you have a $300 copay or more. Most of the time your answer to that is yes.

CS: Interesting. Yeah. We had, we had actually had a guest on this podcast talk about the sourcing of the drugs from Canada and same, same exact thing. It was, you know, the structure is such that the prices are so low that sometimes they just include, you get the drug for free and you were previously paying for it here in the States. So it's interesting to see how that, that plays out. it's interesting. You brought up reference based pricing. We actually have some scars from this. We tried this maybe, it's been a while, like maybe before it was cool. We tried reference based pricing.

MB: Yeah.

CS: And actually it worked really well for the whole first year. It worked really well. And it actually, I think generally still worked well for us in the second year. What we ran into, and I'll get to my question, but we ran into is actually there were a few university hospital systems that just did not want to accept it or negotiate it. And so I think my question is, can you use...

CS: Reference-based plus a network for those that don't take the reference-based or do you have to choose kind of one path or the other?

MB: You can do both. so typically though, and you mentioned university hospitals, they're the toughest to work with, right? And they tend to be, gosh, they do a lot of commercials and you see their name on the stadiums and things like that. But there's a reason why they have that is because they're making the most money and they are hard to work with. I know specifically CU Health up in Colorado was one that we just ended up having to stay away from other than emergency rooms, right? With the No Surprise Act coming out.

where they can't bill you more than the plan allowable and they can't go after the patient with it. They can try to go after the plan, but they can't go after the member anymore. But yeah, the thing with reference-based pricing is this is what I found, because I've been in it for 13 years and 13 years ago we were doing reference-based pricing. It was much easier 13 years ago because the hospitals hadn't caught up to it yet. Then there was this phase where the hospitals caught up to it and they realized, well, we're getting

we're not getting paid enough money. And they're subsidizing that with the fully insured plans. That's where they're getting that, you know, five, six, seven, 800 % of Medicare to subsidize what they're getting from the Medicare patients. So that becomes difficult for the hospitals to, when they're revenue producing hospitals, even though they might be a 501-C3 and they're called a nonprofit hospital, we all know they're in the billions of dollars, right? The strategy with

the hot with plans, right? And for your business is depending on where you are. And I don't know if everybody's in the demographic area. These community owned health plans are becoming a very big thing, right? And those are kind of the three C's that Dave Chase from Health Rosetta talks about is care team. So organizing care in a very strategic way cost, right? So driving the cost down by doing the unbundling and I'll get back to the reference based pricing piece in just a second, but then getting the community involved.

So if you can get the community involved, you can get these nonprofit hospitals now to come in and say, hey, we want to support our local community. And they'll do more of the direct contracts, or they'll do a single case agreement, which can pay some percentage of Medicare, depending on the plan, up to a level of Medicare. The other thing that's happened now is on the back end of the care plan. So one way to combat reference-based pricing issues is on the front end, do a single case agreement or a direct contract.

MB: The other is on the back end is to have a group in place, someone like a FIA group or a good bill is somebody that we like to work with who will now go in and negotiate the bill after the fact. And the 501c3 hospitals, they have different programs that they have to make available to members. So if you go there, a lot of these university hospitals are 501c3s. They have to make these programs available, which can now reduce or even eliminate out-of-pocket costs for members.

CS: Interesting. Yeah. Yeah. And I think it's the timeline that you referenced on the, on the reference based pricing, um, is about when we would have hit it is probably when they started to realize that this was putting their profitability at risk. And I think that, you know, there was certainly some, some dynamics at play there, um, for us as well. Um, well, let's, so you mentioned like, you know, demographics, like group size, you know, it sounds like a group size even of two is potentially, um,

CS: in the ballpark of someone that could benefit from level funded. And then what about the of the geographic spread? I think you were referencing that a little bit, Mike. What about organizations that are spread across multiple states? Does that prevent them from looking at this as an option or how does that maybe play into how they might rule it out?

MB: Yeah.

MB: Yeah, so let me attack the group size first. So there are certain plans out there, like the Bravo Health Plan plan goes down to two on a level funded chassis, right? And there's no underwriting on it and it's available in all 50 states. So that goes to the second piece is there's lots of plans available now that are going to work the same in all 50 states. Obviously, if you've got a demographic where there's more density,

It makes it easier to go in and negotiate with hospitals. Or we're going to specifically market or target areas where we know we've got relationships and it's easier. But I've made hundreds of these calls myself, maybe even thousands at this point now over the last 13 years of contacting hospitals directly and talking to them about what are they getting paid? You just have a conversation with people, right? And it always works better when it's local.

CS: Mm-hmm.

MB: Even if you've got an outlier of somebody in your company that works somewhere remote, to be able to get a tier one contract in place is not as difficult anymore because you're not talking about a big corporation. You're talking about these smaller businesses that are supporting the local community by paying taxes, by taking care of the employees of the hospital, even depending on what the business does. And when I have those conversations, it's much easier to start getting direct contracts in place.

The relationships are important. So that's a big key too. But definitely there are plans out there. Bravo Health Plans is one of those that has a plan that works in all 50 states, regardless of how many people you have in a certain area, it's gonna work. It maybe won't work as well as if you've got something targeted, like Arizona is where those health plans started. So we have relationships with all the hospitals in Arizona. But there's pockets throughout the US, Omaha is a big one.

Georgia, North Carolina, South Carolina, Florida, North Florida, where we've got relationships because we've worked with these hospitals over and over, where it'll work pretty much the same in all 50 states. But the negotiating, the conversation, the creating the relationship piece is the same everywhere.

CS: Okay, so a group decides that this is something that they want to take a look at. I know you guys work with advisors all over the country that are bringing their groups to you in terms of navigating this landscape. Walk us through the process that Bravo does or how they engage with the advisor and the employers when they're interested in pursuing or getting a quote under this model.

MB: Yeah, so two ways. One, like we're on Quote Plus, so it's pretty easy to go in and be seen there. Here's the huge thing about these Bravo Health plans that I have yet to see elsewhere with other plans is the pricing's fixed. So the quote is easy because the price is the price. There's a couple different types of plans. They have a mech type plan that's called everyday care, right? And then we have an HSA, we have a hospital plan.

And then we have a hospital plus plan that adds some more like prescriptions and things back into it. But all those prices are fixed. So getting those quotes is really easy to do. And you're going to know right off the bat. with those plans, because the pricing is so aggressive, there's no underwriting on it. But the pricing is so aggressive because strategically on a level funded plan, we've taken away the things that are really high cost but super infrequent. So it's not a great fit for everybody.

But for certain businesses and maybe even a business that has two employees that have these really high dollar but infrequent needs, it still could be a great fit. You find a solution for the two people outside of it.

CS: Yeah, interesting. hadn't, hadn't heard that you could, you know, do this without any underang. What, what is the, so under like, let's say a larger group, let's take a employer group of a hundred. What would be the process that they would go through and how would that compare to maybe the kind of the, guaranteed issue quote that you're referring to previously?

MB: Yeah. So it's still guaranteed issue with the hundred and it would still be the same pricing. The broker could either go on quote plus through you guys, or we have an RFP link they could submit into, uh, and, and get that quote back. It's instant again, cause the price is the price, the educational piece on it. And this is where, you know, you talk about people moving from fully insured to a, uh, self-funded or level funded. Normally people are going to go fully insured more to self-funded. That's an easier job. It's kind of like a crawl walk run.

Once they see that it works, then the move is easier over. But people have scar tissue, just like you said, right? They've tried something like this in the past, maybe five, eight, 10 years ago, and now they're reluctant to do it. But I think the progression that we've seen, the AI tools that are out there, the number of people, right? Because insurance, health insurance specifically, is crushing the American dream. It's become the most cost.

that we've ever experienced anywhere. And the subsidies are gonna be going away in January, so all the individual plans are gonna be going up, which means you're gonna have more and more people depending on employers, even small employers who maybe said, hey, I didn't have to offer anything before, but now they're gonna want to attract talent because their employees are gonna go, hey, I can't get this $100 plan on the marketplace anymore, why aren't we offering something here? And they're gonna leave to somewhere that's offering it.

I found that in the company I was at before is we here in Arizona, we were offering a health plan. We would bring on younger people. would train them. The health plan was a good health plan, but it wasn't the best one out there. But we had companies here like Intel, Honeywell Insurance, American Express, and we would lose our frontline people to those companies once they started wanting to have families and they were going to experience healthcare costs they left.

So that's why we made a change and we said, Hey, let's go build a solution here that works, that we can attract talent. and so I think that's a big piece with, with why, businesses need to be more strategic and look at a level funded health funded solution. Ours again, Bravo Health Partners plan is, is a fixed price. So it's easy, but again, it's not the perfect fit for everybody. It's why you guys have lots of other carriers that, can get quoted out too. And we work with advisors on that too, to make sure they're.

MB: going into the right plan and a lot of education.

CS: Yeah, I think the need for a strong employee benefits package is really critical as a business owner. know it's something that people look at. In fact, I saw someone, I can't remember where it was through, recently was talking about how they took a new role and they didn't think to look at the employee benefits of the new company that they went into. It was an AgencyBloc, just to be clear, but they didn't think to look at that. And then they realized at the end of the day, they had...

MB: Yeah.

CS: gotten some significant pay increase, but didn't realize that like they were losing a lot on the benefit side or their monthly contribution was much, much higher than it was previously. So I think it's a really important part. I wish we weren't in the business as employers of having to provide those benefits, but it's the way of the industry today. And I think it's just really important to make sure that you're taking care of your team and that you have a strong offering, which is why we take it very seriously.

MB: yeah.

MB: I know.

CS: In the case that an employer moves over to a level funded style plan, what does the employee experience look like comparatively to self-funded as it relates to like, you know, going to see the doctor, having their, getting their EOB, getting their claims, you know, reconciled. Like how is it different? And maybe it's not, maybe it's the same. Just kind of curious about that.

MB: Yeah, it's very similar, right? Because a lot of times if you think about what does the doctor's office want, right? They're looking at the logo on the card, right? And so that's why I move into a level funded. Sometimes it's important to have a network, even if it's just a physician's network that you have and you do reference based pricing on the back end. That logo is kind of the point of entry, right? And I give an example of time. If I asked you, Cory, if you know who

say you owned a business and I came in and I asked you, do you guys take Golden West Credit Union? Will you accept that as payment? What would you say?

CS: I don't know who that is.

MB: Yeah, you'd be like, I have no idea. But if I said, wait, there's a Visa logo on the card here. Will you accept it now? You would say, yeah, of course we take Visa. So that's what some of these, when you build these plans back together, a lot of times your employees, where the education needs to come in is, hey, we made a switch because we wanted to make it more affordable, right? Those savings need to trickle down to the employees too, to give them some incentive to use it. And a lot of times after you do it, like in our company, after we did it for three, four, five years,

We made the health plan free for employees. And then three years later, we made it free for employees and families because the employees have to engage in this. And you had said it from your business standpoint, there's nothing in your business that you accept a 20 % increase with, but you sometimes throw your hands up and say with healthcare, you have to, but as consumers, we don't do this anywhere else. We don't go buy dinner and not know the price of it, but we do it all the time with healthcare. We'll go in and be seen by a doctor.

My son just got a bill from an MRI he had in October today for $1,800. And he's going, dad, what do I do? And I said, hey, I'll take care of it. But it's a phone call and the cost of that MRI is probably between 300 and $700. So we'll get it down to that. But he has no clue. Right. And most consumers have no idea what to do with healthcare. That's where that care team comes in. Right. You got to have a care team that understands the system.

so that as a consumer, you're not out there doing it by yourself. Just like AgencyBloc is good at what it does. And you would say, hey, broker, you don't have to do this work. Let us do this for you. Let us simplify it. That's what a care team does in healthcare, is they simplify it. And so now the business owner has a solution where the employee's experience will look very similar, especially when they go see a doctor, they're gonna just put their card on the table. And they either have that logo network for physicians only,

or there's been a phone call made and what's called a single case agreement's been put in place. So when they walk in, that experience is very similar. Sometimes it's even better because now the providers know, I can just focus on care. And there was a story, I was just at Rosetta Fest in Denver and they mentioned they do these direct contracts with hospitals. they're tier one hospitals. Well, they've got the hospitals so trained that they put their patients that come in. there's a

MB: there's a group of members, a density of members in this area into a purple folder. And they went in and they did a tour and they were talking to the providers and the provider said, we love when we see a purple folder because we know we don't have to worry about the payment. But with a buka, you've got to go in and you got to do charting and coding. And it just, takes so much extra time that it's burning out providers too, right? They're getting burnt out because the system that's designed to pay them is not working for them.

CS: Yeah, makes sense. A couple of things I want to just react to. First of all, when we tried this many years ago, we did not have the Visa logo on a card that we could show the provider. And it was complicated for our team to be able to explain. So I think that, you know, that change or that concept actually would have made the world of difference. Like, because we were already starting off with this, the kind of like a strange scenario where it's like, well, who's going to pay me for this service?

MB: Yeah.

CS: We're like, we promise it'll get paid, but it's like having some sort of a network, like you said, a physician network at minimum to start the conversation. think it makes a ton of sense, And also the concept of like having some visibility into, you know, what the fees are, the MRI scenario. Like I actually, in the past couple of years, my daughter had to have an MRI and I didn't realize this, but the carrier,

MB: Mm-hmm.

CS: that we were with had a tool online that you could actually see what the cost was from the different providers. And it was, I found it interesting because the provider that she was at, which was like an orthopedic surgeon, like their price was much, much higher than just a scanning and imaging kind of like organization that it was like across the street. Now I will say like, as a bad consumer, I knew that we had already, we're going to hit our deductible because she had a serious injury.

MB: Right. yeah.

CS: And so we just stayed at the office, but I mean, it was more than double the cost, you know, to be at that office versus going across the street to another provider. So I imagine that's really valuable information. your members have ways to get insight into that or what's the best way for like a good healthcare consumer to actually get insight into those costs?

MB: Yeah.

MB: Yeah. Yeah. So some, some are going to have tools like you said, and we have an app, right? And I know that was something we had talked about, or we're going to talk about was the power of the plan and the palm of your hand. So transparency and data is the, is the biggest way to combat this, right? When I drive down the street and there's five gas stations, they all have the price up. So I'm, I'm consuming that and I'm going to make a decision based on that. That's what the app does.

but it's really about having somebody in the industry that can have those types of conversations. Because like you said, a lot of times it's crazy, it's just right across the street. And sometimes when you're in the hospital and it's not urgent and you're gonna get discharged is we can make sure you get that MRI across the street where now it's not double, it's 10 times the price if you did it in the hospital versus across the street. So the big move from a fully insured plan to level funded and self funded is you're have access to data.

data that's now actionable when you have the right team behind it. Because as a consumer, it may not be actionable data for me. I may say, if I'm diabetic, what do I need to know here? But there's going to be a care team. That's why it's important to have a care team involved in the type of plan that you build so that care team can help navigate you through the system. And there's times where we got to jump in that hospital and get things done. But then the key is let's jump out as soon as we can, not too early, not too late.

But as soon as we can, go get other care done outside of it, manage the care outside of it, correct?

CS: So your members are using the app to get insight into that and or reaching out to a concierge or a care team to help them navigate those decisions.

MB: Yeah. And things as simple as like getting a prescription, because even prescriptions can cost different amounts at different pharmacies. Right. And someone may say, well, how is that so it's the same prescription? Well, why does gas cost different prices at different gas stations? Like to simplify it. Right. So there's prescriptions that might cost $180 in a capsule format that we can move to a pill and move the pharmacy and it costs $6. Right. And it just happened to be that the provider prescribed that one. They didn't have that conversation with the consumer.

That'll only hit our system one time because we got people looking at that to make that call to say, Hey, Cory, did you know, is there any reason why you wouldn't take a pill versus capsule? And you're going to say, if you say yes, then that's what the price was going to be. But you may say none at all. Nobody asked me, are you okay if we switch that and move it from a big corner store pharmacy to a grocery store and lower the price by $174? And you may go, my gosh, like.

Think about American families, what $174 a month can do, right? Just by having data that now you know. And a lot of that is data finding out who's got chronic problems, right? And who's got diabetes, asthma, COPD, maybe depression, things like that, that we can now actionably take data monthly and create a care plan that's much less expensive to manage a care plan than it is to end up in the hospital and have a high dollar thing happen.

CS: Yeah, that makes total sense. I mean, I can see that like actively managing that goes a long ways. Like you could save some serious dollars by making sure that you're paying attention. What's the, like when you think back, Mike, I imagine there's a lot of success stories where, you know, where, where Bravo Health saved a group or an employee, a lot of money, like any, any standouts for you as it relates to, you know, success stories.

MB: Yeah.

MB: Yeah, and let me give two, because I want to give both extremes, right? I want to give a big extreme. It was a mortgage company with about thousand employees. They were on a Blue Cross plan looking and didn't know what to do. They were getting that big 20 plus percent increase. And we moved them to a Bravo Health that saved them $2.4 million. And they put $600,000 into a fund to help employees with some of the maybe non covered services or if the reference based pricing piece didn't work out. So they created a

a backend HRA, health reimbursement arrangement, to pay for things that maybe didn't, but still save 2.4 million. In a time where they had gone from 3,000 employees down to 1,000, so their company was hurting, and now they're able to put 2.4 million on their bottom line. So that was a huge success. lot of education to the team. We took teams out to open enrollment meetings. We took our medical director out to open enrollment meetings to make sure they were educated on, we're making a change.

How'd that trickle down to the employees? Well, their healthcare was paid for 100 % all the way through the family. That's how much savings the business heard. They paid 100 % through the family and the business still saved 2.4 million. So that was a big one. Go to the opposite side, small business, who typically small businesses are gonna get screwed with health insurance. Because there's more risk, there's less people, they're gonna get high rates. So we can a lot of times save more than 50%.

on a, for the premiums, right? Or business owners, this is what I see a lot is business owners who thought they could not afford health insurance for their employees now understand that they can and their employees get that benefit now. And like I mentioned, 70 % of employees depend on their businesses for health insurance. That's going to go up in January when the subsidies decrease, right? And the premiums increase on the individual market.

And now they're going to have a way to see that success. So there's a long tail of small businesses that we're going to see more and more jumping on and having health insurance for their employees.

CS: Yeah, interesting. We've done a couple of recent episodes and touched on ICRA as well. And I know I didn't, you know, I didn't haven't mentioned this in our kind of our outline for today, but I am curious, like with what I'm hearing in the news and seeing as it relates to the subsidies going away, I feel like there's going to be a lot of pressure actually on the individual market. And that could cause a sort of a swinging effect back to the employer benefits side of the equation. Like maybe, as you think about the next few years, Mike, like

MB: Yeah.

CS: What are the trends and challenges that you see playing out? And how is Bravo thinking about, know, what things are you guys thinking about today to try to address, you know, what's coming?

MB: Yeah, and that swing is going to happen, obviously, because price, the consumer's pricing is going to dictate that, right? People just aren't going to be able to afford it. I think I was reading this morning and it said some number of million of Americans aren't going to be able to even afford insurance anymore. So they'll go uninsured or they're going to, like you said, it'll swing because they're going to depend on employers or people are going to start looking for jobs that their employers offer benefits. So as a business owner, you know, you almost have to offer benefits to attract the right people.

to work there, which should increase your talent pool too, because you're going, the better benefits we have at the lowest cost the business can incur, putting a strategic plan in place is going to be huge. The moves we're doing are sustainable increases, right? So the plan that I was talking about that we built, the Bravo Health Plans has seen a four and a half percent increase over the last five years, yearly, right? And when the average is eight, nine, and a lot of businesses are seeing

CS: Double digit.

MB: double did high double digits or into the twenties. Um, so that's a big thing is as a small business owner, even as a large business owner to be able to say, Hey, we know we're going to get a four and a half percent increase next year. Right. What we need to do is we need to manage those plans by getting our employees engaged in it, which the second thing I would say is the access to data with AI now and access to data. can make such great actionable, um, know, movements in

in taking care of people because once you have data, there's so much you can do with it. On the fully insured plans, groups under 100, typically, they don't share any data with them. And even that 100 to 200, it's limited data. And they do that on purpose because they don't want you to put these changes in place to say, hey, we can save money. They want to charge you more money. And that's a tough thing with fully insured products like the Buka carriers, Blue Cross United, Cigna, Aetna.

a lot of those have fiduciary responsibility to shareholders. So they're trying to drive rates up not as a not protecting the consumer but protecting the stockholder. And that's where you're to see people moving more and more and more off into plans like a level funded solution.

CS: Yeah, it's interesting. know, you know, it feels like there's no incentive for them to actually control the costs. I understand they have, they have to make a margin on a, on a base, right? But that base just keeps growing by, like you said, 10 % per year. Um, the four and a half percent sounds like something you can actually budget to as a business and you're not being thrown curve ball after curve ball. So yeah.

MB: And you're not getting the surprise like, you know, one one's coming up right now. The one one renewals, lots of brokers are working on them. Sometimes those carriers won't release rates till 60 days before. And a lot of times the business owner won't get those till 45 days before. So they don't even know what they're getting. They don't, they are hoping for low, but the brokers are probably prepping them for, Hey, you're going to see an increase in the teens here. Whereas if, if you were on a plan like Bravo health plans, you could say, Hey, you're going to get a four and a half percent increase next year.

Put it in your budget because you know it's going to right? And make it easier.

CS: Yeah. Well, great. I have maybe one more question and a little bit of a plug for our Quilt Plus product. I know Bravo Health is represented on Quilt Plus, which is our small group quoting platform. It sounds like you can get instant quotes on Quilt Plus. Is that right, Mike? And, or if you're interested in reaching out to Bravo directly, how long does it typically take to get a quote for a small group case?

MB: It'll get turned around in 24 hours. Yeah, it's fast. Just a business day. Typically, I would advocate to go on Quilt Plus though, because that process is very simple and you use the system, right? Make it easy for on yourselves.

CS: Yes. Yes, I would too. So it sounds like as we approach one-one, those renewals are coming out. These groups can certainly engage as they get those renewals to kind of compare pricing and see how this option might compare. there anything else that you would recommend they maybe do now as they're thinking about this open enrollment period?

MB: Yeah, I would think just asking the questions, right? Like the big thing for advisors is making sure you're asking the business owners about data and letting them know how important data is. And as a business owner, you've got to have access to data. Like that's the only way you're going to be able to make strategic moves in the future is having access to data. So I would say those, those two.

CS: All right, great advice. Thanks again for joining the podcast, Mike. It was great talking with you.

MB: Yeah, thanks, Cory. Appreciate it.

Posted on Friday, September 26, 2025 in Podcast