Health Care Reform Impacts

Recently portions of the Health Care Reform bill went into act. We are all trying to grasp how it will affect us individually and as a nation, but in our industry how will it affect SPM (sales performance management) systems and compensation as a whole? After researching regulation changes, increased premiums, and some policy options going away I have made a few general conclusions (which I will limit to two in order not to bore anyone)

1) The type of policies that will be sold will be limited and several will go away

We are already seeing this in the removal of child only and mini-med policies. There will need to be alternative polices that replace these and others that fall to the wayside due to cost of administration and overall plan payout. What will these new policies look like?

2)Higher premium costs will occur

Traditionally compensation gets paid on the value of a policy, from first time payment to residual. This will increase compensation on individual policies, but the burden to the company will remain the same or go up. How will you address this within your organization?

So we are now looking at how we operate our Sales Performance Management systems, and driving sales in general. Do we continue to pay at a higher rate knowing that premiums will be artificially inflated? What mix of products will need to be leveraged in order to accommodate for new channels, like the people who are no longer able to get child only policies. This will result in a modification of system policy along with general administration.

Related to this topic, Canidium and Synygy are co sponsoring an industry round table on October 27th, in Philadelphia. Several organizations will be participating in understanding how the new health care legislation affects their business. If you are interested in participating please call us at 713-263-7462 or go to the registration site:

http://www.synygy.com/roundtable/healthinsurance.

The topic of the roundtable is ‘Managing Sales Channels and Compliance Alongside Reform.’