A Level-Funded Plan With A Purpose with Bob McCollins

Hey. Hey. Welcome back to the Broker's Voice. I am excited to be joined by the one, the only bald guy, Bob. Bob McCullins. If you have watched the Broker's Voice, you'll recognize Bob has been on the show before. But we're having Bob back on for part two to talk about a really cool solution he has brought to the market. So, Bob, welcome aboard.

Thanks for having me. Andy, happy Monday.

Likewise, my friend. Now this will go out on Wednesday. Bob and I are recording it on, on a Monday. So when you hear Bob say Monday arm, no foul. All right, Bob, let's talk about this. You said something offline that I just want to start with right away. What you have is a solution for the level funded market, but it's a solution, not a product. That's talk about that.

That's correct. Well, in the tagline of Star lf, it is a level funded solution with a purpose. And I put it that way intentionally, Andy, because of a lot of the frustration that I heard from the benefit advisor and broker community last year as I was thinking about this level funded solution and that frustration of having great TPAs, great risk management solutions, medical management, pharmacy. But the frustration was when you try to put them all together, it was very clunky.

And it was frustrating that.

The employer, the customer and their members were not getting the true and total value of this unbundled solution. So as I thought about creating Star lf, I wanted to position it not to be a product, not to be a canned product, but to be a solution that takes advantage of different relationships, different vendors and their ability to work well together, to have proven that they can work well together and bring those options to the level funded financing for the small to mid sized business owner and for the benefit advisor.

Yeah, talk about that for a second because you said something too that I thought was very, very accurate, which was back in the day, you know, an advisor would go to a TPA and be like, hey, I need help putting a self funded plan together. And they'd kind of leave it up to the TPA to pick the stop loss carrier, the PBM maybe any other solutions they partner with. Today the game has kind of changed where the brokers go into TPA saying I work with these partners, you will also work with these partners. Talk about how that has caused some of the clunkiness that we're seeing in the market today.

Yeah, I mean, you know, back when I had hair and was a lot skinnier and got into this business over 38 years ago, the TPA was seen as the hub. Again, as you said, we're going to bring you this group, they want to be self funded. You have the expertise in the PBM and the data management. You put it all together and give us a solution and.

Piece of business. But you need to be able to work with these vendors. Well, the TPA is obviously going to say, sure, we can integrate with them and they do a great job of interchanging eligibility. But again, diluting the real value of people bringing this solution together. So it forces the TPA to say yes because you know what, if they say no, they're not going to get the business. So that, I guess, conflict. I want to write the business, but I also want to deliver the value that we stand for has really kind of put the TPAs in a tough position. On the other hand, maybe the TPAs ought to step up a little bit more and say, you know what, this isn't a good fit for us. These are our vendors, we've got it worked out, it works. So I get the conflict, I get the dynamic of wanting to write business. But that unbundled solution has kind of put TPAs in a tough spot to be able to deliver the value that they say that they can do, but really aren't doing a very good job of.

Yeah, and your point's well made. I think a lot of TPAs probably say yes for the sake of business. Right. It's new business. But the problem is then they're trying to align with certain solutions. The integrations aren't effective, it's very clunky. And I think this is what has led to, just to be blunt, I know advisors who are coming into groups, writing self funded, level funded, all these unique outside the box cases, saving money as they promised they would and getting fired. And it's like, how is this happening? You're coming in, you're doing everything you say. It's because the integration of the solution was so clunky that despite the savings in money, now you've got employees who are frustrated and ticked off and the culture isn't what it needs to be. So the employer, unfortunately, it probably decides to go back to the way it was.

It is. And you know, we are putting benefit advisors in a tough position. We want the, the next gen and the Health Rosetta and the U powers. We want them to be innovative and bring these new ideas. But typically, and quite frankly, when they're doing it, they're probably bringing vendor partner solutions to the table that these employers have never heard of. So they're putting themselves kind of out on a limb saying, I've got this new solution, it's really going to be awesome. And it does work. But the noise that it creates because of the disconnects, it forces them unfortunately to kind of say, look, as much as I hate to, you know, I'm going to bring the carrier to the table because as a consultant for Mercer told me one time many years ago, nobody ever got fired for recommending Blue Cross Blue Shield. So I know the carrier, I know the problems I'm going to have, I know the dysfunction I'm going to have. But I'm not going to get fired for bringing in a big network and a big, big brand and a big name pbm. Even though it's not going to work as well as it should, I'm kind of safe. So I'm going to take that easy path even though I don't want to.

Yeah. Even though it's not always the right decision, an easy decision often wins out. And so. Well said. Well, let's, let's dive into Star Health, Health Solutions. I'm going to ask the question some others might be asking is Bob, what does the word star have to do with health solutions or a level funded plan?

Well, it was, it was something that kind of evolved over last year and I'll put a plug in. I did a LinkedIn post last week from a beach scene that kind of talked about how Star came to be. So I'll let you kind of view that to find share that story.

It's a cool story.

Well, it was, it was over a period, a tough period, quite frankly, my life. Last fall as my dad was progressing from an injury to his unfortunate eventual passing and thinking about where I was in my career, been doing this, as I said, for 38 years now. And I really was kind of thinking, you know, my dad left a great legacy on people, wonderful man. And I kind of started to think what's my impact going to be? I turned 64 last October, so I'm gaining on that magic number 65. And how many more years do I have left? And what, what do I want people to think of Bob McCollins as an impact on the industry? And one morning I remember recalled a story about the starfish. And it's a story that real quick, an older gentleman wakes up in the morning with his coffee. His ritual in the mornings is to go out on the beach and walk and usually kind of dark before the sun rises and he noticed off in the distance some movement. He got closer and it was a young boy picking something up and throwing it back into the ocean. So that curiosity caused him to walk up and he realized, young man, what are you doing? And the young boy looked up and said, well, sir, there was a horrible storm last night and it washed all these starfish up on the beach. So if I don't get them back into the water, they're going to die. So I'm picking them up and throwing them back into the ocean. And the old man kind of looked around and saw thousands of starfish. And son, I don't mean to discourage you, but there is no way you can throw all these starfish back into the ocean. Well, as the story goes, at that point, the young boy reached down and picked up a starfish, gave it a big old toss, threw it back out into the ocean and turned around and looked at that man and said, you know what, sir, you're right, I can't save them all, but I can make a difference to that one. And that, that struck my heart. That kind of moved me and I took it a little bit further. I went and I found out that There are almost 1 million businesses in the United States with between 25 and 250 employee lives. I call those the Tommy boys of the world, the small and mid sized employer. And I got to thinking about the story of the starfish. And there's no way our industry, even all of us, can help all 1 million employers. But can we make a difference to one? Can we do for one what we wish we could do for everyone? And that passion, that heart that kind of caught me and hit me really hard and I thought, you know what, Bob, this is it. This is, this is what you're supposed to do. And it led me down the path to create star.

Lf that spoke to my heart, Bob, because I think, you know, go look at LinkedIn profiles of some of our peers and you'll hear, you'll see these people saying they're disrupting the healthcare system. And I hate to tell you, no, you're not. Jeff Bezos could not disrupt the healthcare system. You are not. Right.

Yeah.

But you don't have to. Yeah, just help one company at a time, help one employee at a time. And you're doing your job. And that's coming at it from that mindset of, of what you're hoping to do with Star Health Solutions. I just love how you've intertwined that story into the name of the solution itself. However, let's talk about this. The name STAR is also an acronym. Yes, it Is So if you wouldn't mind, for the people who don't know the acronym, let's start walking through each letter of stars and. And it'll give the listeners a chance to understand what you truly built here. So let's talk about the S. Well.

The S stands for simple. Again, a lot of the feedback I received from the benefit advisors is we like pulling all of these solutions together, but it's got to be simple, right? That's the frust. So I really wanted to lean hard on the S and simple in creating star level funding. The T stands for transparent. Okay, look, you can't be in this industry today and not figure out somehow how to bring transparency into the equation. And while I'm not really a huge fan of the word transparency, I prefer truthful. That may be a little agitating to some folks. But it's the employer's plan, it's their data, it's their information. They need to be able to see everything and be able to at the advisor's recommendations, make moves and make changes. So transparency, having access to data, critically important because quite frankly, these groups tend to not have access, any access or certainly minimal access. The A stands for aligned and the aligned may not be what people think. The aligned in this situation are the solution providers, right? These are the industry providers, the TPAs, the PPOs, reference based pricing, PBMs, medical management at risk, Maternity management. These are the solution providers that I've chosen to bring into the fold, if you will.

That are all aligned to do the right thing. They're good people, they want to help for all the right reasons. They're aligned to work together for the good of the employer and their work family. And then the R stands for rewards with the S cutely being a dollar sign. Because quite frankly, if you're in a level funded program or any self funded program, you're in it. So that when you have a good claims year, you get money back. And much like many of the other level funded programs, you get 100% return of your claim bucket to the employer. No gotchas, no you have to do this or you got to do that. But the R is for rewards. When your employees take advantage of the risk management programs, when they're choosing wisely with what they're how, what and how they're accessing their healthcare, that's going to benefit you the payer, it's going to benefit them as the employer or the member. So people should be rewarded for good choices and taking advantage of the programs that are going to put in place. So simple, transparent, aligned rewards.

Yeah, I love that. You know, and thinking about what foundation Star Health Solutions is built off of that relationship with Edison Health, you know, talk about that because when people hear the, the phrase level funding, it could go anywhere from all savers, you know, United Healthcare product or Cygnus level funded plan to, you know, people who are literally taking an unbundled concept and adding the, let's call it the level funded rider where they pay it like it's a level funded plan.

The question always comes up is what makes you different? And I think that the fact you've built this off the chassis of Edison Health is what makes this so unique. So if you don't mind, for the people who may not know that Edison Health, what is that? Talk about that, because that is definitely a differentiator of this plan that you're bringing to the market.

Yeah, thanks for recognizing that Andy. And again, thank you. Thinking about putting this together and what can make another. How many level funded products are there out there? 50, 60, 80. What's going to make Star different? And again, the foundation of Edison Healthcare and the centers of excellence model that Tom Emmerich built when he went to work for Walmart and Sam Walton asked him to come in to address Walmart's healthcare problem. And Tom doing that, creating the first destination centers of excellence by finding the best care teams out there to send Walmart and their work families to, to get the best care for things like cancer, for musculoskeletal issues, for cardiac, for complex pediatric and complex care cases. That's critically important for the patients to have an outstanding experience. Because if you know the story of Tom and Edison and what he found at Walmart, that exist today, and these are scary statistics, but they are unfortunately all too real. 3 out of 10 cancers initially diagnosed are completely misdiagnosed or they have the wrong treatment. For the type of cancer that you have, 3 out of 10. Okay, just think about that for a second. 4 out of 10 cardiac diagnosis, 6 out of 10 musculoskeletal spine surgeries are unnecessary, completely unnecessary. There's an alternate, less invasive or you don't even need it, you just need some good physical therapy. Those are scary numbers, but they are real. Those are real numbers. So by bringing that into the program again, what I wanted to do in my frustration is there's a number of these solutions out there. But when you talk to the vendors, when you talk to a diabetic management solution, well, what's your target? Well, you need to have 5,000 employee lives. Well, this is a 25 to 250 Tommy Boy Market. These people are just as important as the people that work for a 5,000 life group. I wanted to find solutions like Edison Healthcare to bring into STAR level funded to again provide bringing back the care and healthcare and the benefits and benefits. And when you do that, you're going to impact the lower end costs. So bringing about those care solutions into this program built foundationally off of Edison Healthcare was critical to the development of what I wanted STAR LF to be.

Yeah, I want people to hear how important that is because this, the foundation is Edison Health, which is really the foundation of Tom Emrick. Tom Emrick built the benefits at Walmart. I want you think about that for a second. You're now able to bring the benefits, essentially the benefits Walmart provided its employees from the centers of excellence and everything else that goes around that to a group of 30 or 40. And you and I both know the biggest gap a group of 30 or 40 has is access to options.

It is. I mean the whole point of this is to let the fully insured employer know that they have options. Yeah, because too often they've been told they don't. Or you're too small. Absolutely false. You have options. It may not be right for you today, it may not be right for you ever, but boy, you're one of those starfish. We're gonna make sure that you get thrown back in the water. Know what those options are?

100%. Now let's talk a couple details about the plan. I love the way you, you phrase some of these things on your board behind you, you've got the fast. No, let's talk about that. What does that mean? What if I'm a broker seeing this? Bob, what the heck is a fast?

No. Yeah, that's not something brokers and benefit advisors like to hear hear. Very often it's is the word no. What I mean by that is this. Again, going back to simple. I wanted the process of getting a proposal to be simple. I wanted the speed to quote, to be important. Unfortunately, again, in the pecking order, these groups tend to get their renewals late in the game. Okay, it's not that they're not important, but let's face it, a 70 life group is not as important as a 700 life group group. So the fast knows important and how it works. Is this all I need using artificial intelligence? I just need a full census, including the dependents. I need the current renewal and the prior renewal. Once I have that, I'M submitting it to my underwriters and generally within 48 to 72 hours I get an email back that says, hey, Bob, sorry, this one didn't pass underwriting. We're going to have to decline to quote. That's the fast. No, I want to let the broker know, hey, we tried. We got a no. This one didn't qualify. Let's go find another one. The opposite is a fast firm. Yes. Meaning in that same time frame, if I don't get the no, well, guess what? I'm going to get the yes. I'm going to get the fully insured equivalent rates. Here you go. Go sell this group for June 1st. Go make it happen. Here's 10 set plan designs. Real simple. Go pick two. Here are your rates. No further underwriting. No individual health questionnaires.

Love that. Now I'm looking under the fast. No, I can't see what it says directly under. Yeah, what does that say?

It says big equals small.

Let's talk about that. What does that mean?

It goes back to the foundation bringing big company risk management solutions. Okay, so we talked about Edison Healthcare. What else? Virtual primary care. You know, if there's a market, there's strong direct primary care. We want to include that and take advantage of that in the market. Those again, typically for larger employers, if we have a patient that we identify is at risk with a pregnancy, we have a special program for at risk maternity that we can bring in to help that person. Again, 35, 40, 70 lives, you don't typically get that chronic kidney disease. We've got, you know, Kimberly Langford and the wonderful folks of specialty care management, Diabetes. We've got a diabetes program that allows people to get their diabetes testing supplies at no cost. The employer is paying a significantly reduced rate. We're eliminating the price and the cost barrier for that patient so they can get their test strips, so they can test as they should and so that they can be connected with the diabetic care management coach. So we've brought a number of those big company risk management solutions for the small and mid sized business owner that typically don't exist.

I love that.

Return on premium. You know, that's a concept with level funding. You know, I think about the level funding plans I used to sell out here when we sold through Cigna, you know, they had the option, do you want all the money back? Do you want 2/3 of it back? Do you want half of it back? The more you want back, the more we're going to charge you up front. Talk about if I'm selling. If I'm putting a client with Star Health Solutions, how much money, how much of the unused claims bucket can my clients get back?

100%. They get, they get all of it back again. No gotchas. Look, it's, it's the transparency, it's the truthfulness. It's as simple. You've got, you've got two buckets, essentially, one bucket is your administrative cost, you know, your stop loss, you know, your network access fees. That's the fixed bucket. But the other bucket, the bigger buckets holding your claims, it's the employer's claims money, okay? If there's money left over, it should go back to them. They should be rewarded. We want to celebrate that. We want to get one of those big hunk of novelty checks and put paid to the order of, show the money, take the picture, hand them the check. And now go celebrate with your associates. Let them know, hey, we did well this year and we're going to give you a premium holiday or we're going to, you know, buy a dental plan or we're going to put money in your hsa, whatever it is, it's their money, it's their data, it's their money. It's that simple.

I envision you having the novelty check with a big starfish on it. So if you're not investing in that yet, you might want to think about it.

Yeah, Yeah, I could. Yeah. That's a good idea. Thank you.

All right, two more questions. So you use a concept when it comes to identifying the right advisors to sell this, that I absolutely love. Plus people like us. Describe an advisor who would be defined as a good plu. What character traits?

Knowledgeable about self funding, knowledgeable about level funding, captive partial self funding. They're knowledgeable about self funding. They've done it. They appreciate the value of the risk management solutions they can sell at 1218. And again, I did a survey a couple weeks ago about whether I should do a 1218 or a 1212 with a terminal liability option. And I really appreciate the responses on both ends, but my gut was telling me from the beginning of 1218, I'm a more conservative type of approach, more conservative guy. It fit my personality. So that kind of narrows the field because, you know, you have to be willing to take the little bit extra effort to sell at 1218 because it's going to be a little bit more probably than the fully insured, but you're going to have better retention. So, you know, they're knowledgeable and self funding, they've Been there, done that, they're selling it, they value the risk solutions. You know what, they've done reference based pricing too and had success with it. They can sell the 1218 contract.

And you know, they just, they just have that ability to be consultative and really bring this again, this solution to the employer to let them know there's other options out there.

Yeah, I, I think, I know with the 1218 you actually made a good decision because you're kind of protecting the broker against him or herself. When I, when I say, what I say by that is a lot of advisors will sell the 1212 but fail to tell the client that your first renewal might be a little higher than expected. Because if, unless we keep it on a 1212 with TLO, we're going to have to move contracts. That's where those advisors get. They, they feel like they gotten burned but it's because they forgot to communicate that the first renewal is probably going to be larger than usual versus going to a 1218 which again might be higher priced up front but it's going to be more, the renewals are going to probably be more conservative or in better shape years after.

And again I go back to the word solution. A lot of level funded is sold quite frankly based on the price. The price is competitive, it's a competitive stop loss quote. It's a competitive bundle. They're selling on price. I really see star level funded as being a first step into self funding. You know, you may do this for two or three years, kind of get the hang of it, realize how valuable the data is, the recommendations from the advisor, maybe say, you know what, let's think this year about a captive. Maybe you'd be a good fit to go into a captive. Well, what's that then? They can explain it. So I kind of see it as a baby step to self funding. They go level funded maybe in 2, 3, 4 years they decide to join a captive, maybe they decide to go on their own and be partial self funded. But I hope that the way that it's been structured with the 12:18, with the risk management features, with having identified good vendor partners and TPAs and do well to work together and bring that value. My hope is that the retention for the benefit benefit advisor is longer than just hey, we got a competitive quote, let's do this this year.

Last question.

I look at a lot of products that enter the industry, products, not solutions.

And one of the biggest challenges they have is the people behind the solution are unknown. So a lot of people don't know who they are. And I think that creates a challenge for any solution trying to enter the market in a market in an industry like insurance, where advisors probably more than they would like to admit, commoditize things. Talk to us about, you know, you've spent the last couple years really building the bald guy, Bob Brand.

How has that brand helped you when it came to launching Star Health Solutions?

Real simple.

People know me.

I think people like me and more importantly they trust me. I think I've built that relationship quite frankly, 90% of it through LinkedIn, 10% being able to meet people face to face at conferences and like I said, an Ascend or you powered and those types of things. But people have got to take advantage of what I learned at a great Mastermind class or broker branding academy back in the second half of 2020 because I would be remiss if I didn' mention that Mr. Andy Neary. But you know, implementing those, those programs again, I, I had a conversation with a couple ladies this morning that I just met recently at an event that you were at and, and they already kind of knew me and, and I think like me and trust me and, and that has allowed me to, to launch this. I'm also launching it very intentionally and again, it's my choice. I'm looking for 25 to 30 benefit advisors to partner with. You know, again, plus following that, that psychographic profile of the type of person I want to work with. This isn't going to have 500 brokers out there. This isn't a spreadsheet solution. Again, people that I want to work with want to pick up that starfish and throw it back into the ocean so that all of that with the bald guy, Bob Brand, with the starfish lapel pen, with what I'm doing all goes back to.

I think making great connections for the right reasons and when it was appropriate to reach out to them. With this, it's being accepted not because it's a great product or it's unique in this form or fashion or it's the only level funded. No, it's because they've got to know me, they've got to like me and they've got to trust me. And on the reverse, same for them.

I was talking to a friend the other day in the industry and he too has done a phenomenal job building brand and name recognition. And I know we had a conversation about where he's going in the future, things, some things he's contemplating. And I said to him, I said, here's the best part. When you Build brands and name recognition, you can actually do whatever you want. And I truly mean, I truly believe that. And I think you're a living example of that. Bob, you decide, hey, I want to build a level funded solution for the market. Well, because bald guy Bob already exists, building that solution and doing it successfully makes it so much easier.

It certainly does, yes.

And that's what I love about that. Well, last question. If an advisor is listening, watching, going, okay, I got clients in that 25 to 125 space, how can I reach out to Bob? What are the best and easiest ways to get a hold of you?

I tell you the best and easiest way folks, is go out to LinkedIn, look up Bob McCollins, it's MC with the Collins afterwards, if that doesn't find it, you're going to recognize if that little emoji, a ball guy Bob, doesn't pop up, you don't have the right connection. But truly that's just where, that's where I would love to meet you. And hey, if I can provide any help or assistance, I would love to do that.

And you're going to see some great content from Bob because I am challenging Bob to put some good content out on LinkedIn to educate you about all things level funded. So Bob, I want to thank you for taking the time to jump on today. This was fantastic.

Thanks Andy.

And for everybody else listening in, if you have clients in that space, 25 to 125 employees, you're looking for a different solution, look no further than what Bob's got with Star Health Solutions. Like I said, there's very few solutions if any, in the market that are built off of a foundation like Tom Emerick and Edison Health. So make sure you take a look at Bob, reach out to him, as he said, connect on LinkedIn and you won't be disappointed. Now you might get a fast no, but hey, you're going to be able to help your clients pretty quickly. So everybody else have a great week or have a great week. Have a great day, Bob, thank you again. And as Bob said, just go out and help one.

Absolutely. Thanks Andy.