As you call on prospective accounts this year, keep a secret weapon in your back pocket. What? You're not used to thinking of COBRA administration as a secret weapon? Think again. COBRA is a pain point, a hot button and an expensive point of contention, making it an ideal conversation starter and change agent. As…
As you call on prospective accounts this year, keep a secret weapon in your back pocket. What? You're not used to thinking of COBRA administration as a secret weapon? Think again. COBRA is a pain point, a hot button and an expensive point of contention, making it an ideal conversation starter and change agent. As you know, separating an account from an employee broker is no easy task. But it's a task that makes a whole lot easier when there's a highly relevant topic begging discussion.
If your competitor happens to be ignoring the COBRA elephant in the room, you'll enjoy an immediate competitive edge by introducing the COBRA administration topic. Not sure how? Below is a ready-to-use sales script.
THE COBRA ADMINISTRATION SECRET WEAPON SALES SCRIPT: This script assumes you're meeting with a decision maker who has given you permission to ask a few questions.
YOU: Are you happy with how your current agent is managing your health insurance benefits?
PROSPECT: Yes, our agent does a great job for us. We've been very satisfied with our benefits package this year.
YOU: Great, it's good to hear you're satisfied with your health insurance benefits. Now let me ask you – are you also happy with the way your agent is helping you through the challenges of COBRA administration? She has helped you navigate all of the recent legislative changes and helped you avoid expensive mistakes, right?
PROSPECT: Well, kind of.
YOU: Oh good, because COBRA is one area some agents overlook. It sounds like your agent has things covered. So, you probably already know how to reduce the labor hours needed to administrator COBRA efficiently, right?
PROSPECT: I do not know about that. It's actually taking more people to administrator COBRA now that the laws have become so complicated.
YOU: Did you know it does not have to take more time? I'm sure your agent has probably already apprised you of the concerns such as record keeping, accurate reporting and billing overpayments. And I'm sure you already know that one seemingly minor oversight in COBRA administration can cost you thousands in overpayments, fines or litigation. But even with all of this, many of my clients have found ways to reduce their COBRA administration burden. Has your broker helped you assess your current situation, evaluate your COBRA administration options and choose the best solution?
PROSPECT: Not really. Sometimes I am worried something something might slip through the cracks. What do you mean by best COBRA administration solution? Does such a thing really exist?
YOU: It's a good idea to weigh the potential cost savings of outsourcing COBRA administration compared to managing it in house. For some companies outsourcing makes sense, for others it does not. Your company may gain significant time and cost benefits from outsourcing. One of the largest cost savings is labor expense. One study estimates the average employer spends four hours per COBRA participant, per month. If an employer outsources the process, the four-hour expenditure drops to about 20 minutes per participant, per month. And labor expense is not the only savings. I'm sure you've already heard about all this, right?
PROSPECT: I do not remember. But I thought outsourcing was only for big companies. Do you really think it's a viable solution for smaller employers too?
YOU: Absolutely. Companies of all types and sizes can benefit. For example …
- If your company is understaffed, the job of COBRA may fall on employees who already have many other responsibilities. They probably are not adequately trained in COBRA and do not fully understand the risks and costs of noncompliance. It may be cost-effective to outsource COBRA administration to a specialist so you can avoid expensive oversights. The cost of one health insurance premium overpayment usually more than covers the annual expense of outsourcing.
- If your company is growing, you probably need to focus your HR efforts on attracting and retaining talent. You may gain significant time and cost benefits from outsourcing, while freeing you to focus on tasks that support your growth.
- If you're a business with tight margins, you probably can not afford the costs of noncompliance. You may appreciate the peace of mind of outsourcing to a professional firm that carries the added security of professional liability coverage.
Let me ask you, which of these categories (understaffed, growing or tight margins) best describes your business? I'm sure you've already talked to your agent about this, but in the ideal scenario, how would you change your COBRA process so it was less of a burden on your bottom line?
PROSPECT: I'm trying to grow my company. In an ideal scenario, I would like to wash my hands of COBRA and redirect my HR team to top line strategies. I never thought outsourcing would be something I could afford though.
YOU: Well, it's worth exploring is not it? When I'm working on your health insurance quote, I can also provide you with a COBRA outsourcing quote and I'll help you analyze your potential return on COBRA outsourcing. If the revenue or savings opportunity is twice what you would spend to outsource COBRA, it's worth considering. How does that sound?
Do you see how easily you were able to get this prospect's attention by using COBRA as your secret weapon? Now, more than ever before, the COBRA conversation is making and breaking health insurance relationships. COBRA administration is a sales secret weapon and it will remain so well beyond 2014 because continuation will be an ongoing issue. If you take the time to introduce this highly relevant topic, learn about your prospects' challenges, build a solid rapport, and paint a picture of an ideal solution, you'll greatly improve your odds of making a sale. By using COBRA administration to get your foot in the door, you'll make inroads with your health insurance prospects and separate them from your competition.