Health care plans

Employers: Benefits Are More Important than You Realize!

That’s what the Seventh Annual Study of Employee Benefits Trends – Findings from the National Survey of Employers and Employees shows. In fact, their data says health benefits are valued by 75 percent of employees, while employer perception is that 59 percent of their workers value health benefits. That’s a pretty big gap … combined with a number that states that well under half of employees (43 percent) actually understand which benefits fit their needs. Yikes!

It’s clear from all the numbers that employees value benefits more this year than in the past. Employees are talking more control of their finances and are increasingly looking to the workplace for help—even if it’s fully employee-paid benefits. Employees are also becoming more aware of their personal risk exposure, which leads to greater appreciation for benefits and company loyalty: Forty percent of employees say benefits play an important role in their decisions about whether to remain with their employer.

Here are some more key figures:

When asked which benefits are an important factor in employee loyalty (2007-2008), “salary/wages” decreased in importance by four percent while “other insurance benefits” (life, dental, disability, vision) climbed in importance by 18 percent (51% to 69%).

41% …

of employees consider workplace benefits to be the foundation of their personal safety net.

51% …

of all employees now state that they obtain most of their financial products through the workplace.

46% …

of employees have expressed greater interest in learning more about the benefits offered through their workplace.

73% …

of employees highly satisfied with their benefits were also satisfied with their jobs.

22% …

of employees not satisfied with their benefits said they were satisfied with their jobs. (Take note, employers!)

33% …

of employees expressed concern that their employer may reduce or cut benefit expenses in the next 12 months because of the economy.

90% …

of Americans believe that it is important for companies to continue to offer benefits, even if they must pay most or all of the cost!

Employer objectives and employee priorities seem to intersect, but they do not fully align. This, in our opinion, opens up opportunities to potential new benefit offerings.

If you’re surprised by any of these numbers—especially if you’re an employer—feel free to contact us at Stephenson Welsh Insurance Services to see if changes in your benefit offerings would better serve your employees while better positioning your company for retention and growth.

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During Flu Season, Prevention is King

Right now, many of our clients are concerned about getting the flu—especially H1N1 (Swine Flu). The answer to the question on most people’s minds is “yes,” the H1N1 vaccine is going to be covered by your insurance in most cases, but it’s still being given out on a priority basis.

We’re glad people are asking about vaccines because preventative care is an extremely important tool in staying healthy and avoiding potentially costly insurance charges related to illness. And most high-deductible plans have excellent preventative care features at no charge or that don’t apply to your annual deductible.

In addition to vaccines, regular wellness visits, covered screening exams, exercise and proper diet are a powerful ways to keep the body strong and to nip health issues in the bud.

We’re also aware that there are a significant number of people out there who are uncomfortable taking vaccinations for various reasons. In those cases, keeping the immune system strong through preventative measures is especially important to staying healthy and avoiding illnesses such as H1N1. Talk to your doctor, nutritionist or acupuncturist about the best ways to keep your immune system at peak performance to stave off seasonal flu and H1N1.

If you’re confused about what’s covered and what’s not, your broker should be a resource in answering your questions and directing you toward covered preventative care. You’re paying the premium costs for your insurance, so we want to make sure you’re getting the most out of that coverage and really leveraging it to support your good health.

When a virus runs rampant such as H1N1, it can be scary. People who need to be in public for work and life get understandably worried that they could be exposed and be the next to get sick. We as brokers hope that through covered preventative measures and good, clear information, our clients can feel more empowered … and more healthy.

Note: Every insurance carrier and every plan operates a little bit differently. As a reminder, always check with your doctor or carrier to confirm covered benefits and what qualifies as in-network services. Out-of-network services may cost more or have different coverage levels.

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Health Reform Latest: Words, Bills & Dollars

To say the legislative process has been “messy” would be an understatement. But despite all the heated rhetoric, we still seem to be moving closer to some form of health care reform day by day.

One of the main questions at this point is whether any degree of bipartisan consensus is possible, or if the Democratic majority will attempt to push a bill (or bills) through to passage on their own … either through a filibuster-proof 60-vote senate majority or the complicated “budget reconciliation” course of last resort, which theoretically would only require 50 senators for passage. Many people are uneasy about this approach.

Of course the other dominant question is whether the bill ultimately heading to President Obama’s desk will include a “public option” to compete against the offerings of private insurance companies. According to the latest reports out of Washington, the life of the public option is largely now a numbers game. This is the most volatile element of the legislative process at the moment, so we’ll keep an eye on the latest. We could know significantly more as early as Friday.

Meanwhile, the latest figures show health care advertisements on television have topped $100 million, illustrating how high the perceived stakes are for many parties and industries that would be affected by reform.

There are still many, many moving parts and how all the pieces of the puzzle fit together is not yet clear. Right now we are waiting on the Senate Finance Committee to complete its work so senate leaders get begin cobbling all the different versions of bills together into a package to take to the senate floor. The floor debate could last weeks (or longer) depending on how things go.

At this point as insurance brokers, we see our job as staying up to date on everything that could affect our current clients and having a firm grasp of what the re-formed health insurance landscape will look like (so we can properly advise new and renewing clients). One thing seems clear: No matter what health care looks like, there will be a need for expert help navigating all the choices and plans and key details—and matching people and groups with the programs that best suit their specific needs. That’s what we’re here for.

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Health Reform Update: Are We Moving Too Fast?

Health care reform is moving at a lightning pace, so we thought we’d provide another update on all the latest developments. We reached a major milestone, as two House committees approved reform legislation. That’s never happened before, and an overhaul of our health care system has never been so close.

… or so far away. As Reuters reports, there’s a long way to go and many hurdles to overcome. The biggest recent “pitfall” has been a report out of the non-partisan overseer Congressional Budget Office, which declared that the most recent iteration of the Democratic health care proposal wouldn’t actually curb escalating health care costs. Then, there was the news that Massachusetts was backpedalling from universal health coverage. (Mass. was often cited as evidence that health care reform can succeed.)

President Obama came forward Friday to address any growing concerns and voice vociferous support for speedy reform. And while the path to comprehensive reform is daunting and the best direction for Americans still unclear (especially small business employers), it would seem unwise to bet against the president getting this done before 2010.

While there are significant differences between the national and Massachusetts model, what the Bay State’s woes illustrate is that perhaps it’s not in our country’s best interests to rush through reform intended to meet or beat a self-imposed deadline. Maybe if Massachusetts is taking major steps backward, it’s an indication that they moved too quickly in the first place and some important elements slipped through the cracks. Now, some feel if national reform doesn’t pass this year, it never will. But whether or not that’s true (there’s no way for us to really know), it shouldn’t have to be that way.

Really, we’ve waited this long, so it would be wonderful if we could fully deliberate all the reform possibilities and be as sure as possible that we’re doing this right. Someone said to me recently that what’s happening right now with this accelerated timeline feels like Congress is “trying to force a watermelon through a garden hose.” It’s true that these are really big changes, so there’s a whole lot to thoughtfully consider and not a lot of time to do it in.

It’s still extremely early in the process, and there’s still plenty of reason for optimism. Hopefully, moving forward in the wake of the CBO report and the news out of Massachusetts, the emphasis will be on taking the time to do reform right, rather than getting reform done by a particular date.

Just know that if you’re a current Stephenson-Welsh client, we’ll keep following all the news out of Washington and blogging about anything that has a direct impact on your insurance.

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Use it or Lose it? Not with HSAs

Heath savings accounts (HSAs) and flexible spending accounts (FSAs) both provide tax-free ways to pay for all your medically eligible expenses. But they are often unfairly lumped together in people’s minds when it comes to the perceived drawbacks associated with the accounts.

It’s true that with an FSA, if you can’t use up invested money by the end of the year, you lose it. So, people scramble around, buying eyeglasses they don’t really need and finding any way possible to exhaust their account … or they’re left in the lurch when the account runs dry early. That experience leaves a bad impression on many people, which creates resistance around the idea of putting in place the HSA associated with high-deductible plans.

But HSAs are getting a bad rap.

HSAs are truly flexible, portable and in your name (not the employer’s). You have the control over when you put money in and when you take money out. You have control over the amount of those funds. You don’t have to take an educated guess at how much you’ll spend because the money isn’t vanishing into thin air at midnight on Dec. 31.

Not only is an HSA a retirement account, but whatever you don’t spend, you keep. The amount left over just rolls over into next year and continues to accrue. If you leave your employer, you take that account with you. It’s established and opened in your personal name, so the employer has nothing to do with it and the money doesn’t roll back to the employer. So, with an HSA you’re getting a medical IRA. You can actually make money on it if you’re a savvy investor and take that money wherever you go. It is a legitimate addition to your financial portfolio.

Used wisely, an HSA is an investment tool that will save you money and continue to grow. If you have big expenses later in life (braces for your kids, a big and unexpected medical expense, etc.), you have money saved up to deal with that.

This All Sounds Good … How Do I Get Started?

Starting an HSA is a pretty simple process-especially if you have your health insurance broker walk you through it. HSAs can be opened through essentially any bank or HSA administrator. You have to have a high-deductible, HSA-compatible health plan to open and contribute to one. What’s important to know is that if you later switch health plans, you won’t lose your HSA; you just can’t continue to contribute to it.

You can put in whatever amount of money you want at the outset. In fact, you can either prefund it or wait till you have a medically eligible expense. That means you can put in money ahead of time or pay out of pocket, fund the account after the fact and reimburse yourself out of the HSA account.

What’s Considered a ‘Medically Eligible’ Expense?

The book detailing what IS covered is an inch thick. You’ll only run into trouble with “elective” medical expenses such as cosmetic surgery, so no Botox injections or augmentation. Complementary medicine such as chiropractic care and acupuncture is eligible if you can validate that it’s needed. You also cannot pay medical premiums or insurance premiums with the funds. Otherwise, it covers most things that come up. Ask your broker if you’re not sure about a specific medical expense.

It’s Not Too Good To Be True

People often figure there must be “a catch” with HSAs since FSAs, while still quite valuable, are full of rules an exceptions. The reality is that HSAs are highly flexible, portable, carry over into the next calendar year and can grow over time. Talk to your broker or contact us with any questions you have or to get started.

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Answering Your Health Care Reform & Benefits Questions

While negotiations in Congress are certainly still ongoing, we thought it would be a good time to talk about the most recent health care reform proposals—and through doing so answer some frequently asked questions.

Let’s start by simply stating the obvious: We have a broken system. There are too many uninsured people in this country, too many people struggle to obtain adequate coverage and the process is so complicated that without a good broker it’s an immense challenge to secure the very best, most affordable plan for you and your family.

The solution with the most steam is mandated health coverage for all Americans (or more realistically 95 percent of all Americans). The outline recently released by Sen. Ted Kennedy (D-Mass.), as The Washington Post puts it, calls for “sweeping health-care legislation that would require every American to have insurance and would mandate that employers contribute to workers’ coverage.”

Democrats are not alone. This week, Sen. Judd Gregg (R-N.H.) reportedly broke ranks with his Senate colleagues with a proposal requiring that individuals own health insurance.

And while coverage for all Americans is certainly appealing, it’s the second part about mandated contributions that has many groups—from insurers to doctors to employers—concerned and keeping a watchful eye. What would it really mean for employers to contribute to workers’ coverage … and how would it work? Would this guaranteed health care be guaranteed by the government? Guaranteed through a person’s employer? Through a public health option?

There are a lot of uninsured individuals who don’t have coverage through their employer, so how do you make similar plans available to all individuals and families—especially those who don’t have health coverage through their employer?

These are all questions to which we have some clues, but it’s still too early to tell. What is clear is that the Obama administration is deeply committed to health care reform this year. In that same WaPo article the president is quoted as telling members of Organizing for America, “If we don’t get it done this year, we’re not going to get it done.”

That kind of urgency necessarily leads to a discussion of cost. Analyses of a recent Democratic House proposal estimated a need to cut 2 trillion dollars over the next 10 years to pay for a dramatic overhaul of the health care system. President Obama this week, according to the reporting of Politico.com, “summoned Democrats from two key Senate committees to the White House on Tuesday to make clear that the bill must control health costs and not add to the deficit.”

The goal is affordable health care plans for everyone, but where does that money come from and who’s going to pay for it?  That’s the big challenge right now. That’s what everyone on the Hill is trying to figure out, while those groups who would suffer under changes are mounting opposition.

I’m not here to characterize the current proposals as good or bad for Americans. In fact, there’s not enough concrete information at this stage to even make that judgment. My concern as a father, a broker and an American citizen is the potential for rushing into a new program too quickly and then have “buyer’s remorse.”

If this is done too quickly we could look back and realize our options or the quality of benefits has been compromised. For example, no legislation should prevent an American from being able to choose his or her own doctor. No legislation should effectively “penalize” those who have taken the steps to secure coverage by forcing them into inferior changes. There’s no evidence that a current proposal would create such limitations, but that’s just the type of unintended consequences that can occur from a rush to action. I just hope that through deliberation, we can put the right plan in place. At Stephenson Welsh, we strongly believe in continuing a private health care system that supports the freedom to choose your own doctors—one in which those who need coverage most are not denied the coverage they need.

It’s a good thing that reforms are being discussed. It’s just essential that we go about this in a thorough, deliberative way.

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Recent Survey: Health Benefits Not on the Chopping Block

According to a recent survey by Workscape, the vast majority of employers are not reducing health care benefits or forcing workers to shoulder more costs despite the state of the economy. Only 20 percent of responding companies reported a reduction or reconstitution of benefit offerings.

The fact that most companies are not decreasing their commitment to employer-sponsored health benefits, even though they are often the costliest of benefits, underscores the critical role of such plans in the overall compensation mix,” said Tim Clifford, President and CEO of Workscape. “Most organizations realize that in order to survive the recession and be poised for growth when the economy rebounds, employees must remain healthy and have peace of mind knowing that their families are protected.”

This is clearly good news for the industry and good news for most small businesses and employers. One way or another, employers are finding a way to make this work and doing everything possible to not cut health benefits. Forty-four percent of companies responding to the Workscape survey are opting for high deductible plans to offset costs, but all indications are they’re still funding those plans at 100 percent for employees. Some employers are taking steps to cut 401(k) or disability benefits. A small percentage of employers are going to higher employee contributions to pay for their benefits, although the vast majority are not.

The bottom line is to this point, employees’ health benefits are still sacred.

While disability and 401(k) plans as well as ancillary products may suffer cuts in the short term, that’s much better than the early predictions about how the steep recession would impact the health care sector. Instead of a catastrophic impact, this survey shows that employer-sponsored health benefits have withstood the economic downturn and are, in essence, considered the very last to go when a company is struggling financially.

As brokers, we think that’s absolutely the right decision. Health insurance is critically tied to employee satisfaction and is necessary for sustainability. In most industries, benefits are a retention tool. Most employers realize they need to offer quality health insurance to attract and retain quality employees. When considering two jobs that are of equal interest, a savvy talent will usually gravitate toward the superior benefit package. This is especially true in the small- to mid-market space and the technology sector.

When one employer offers quality benefits and another doesn’t, that makes the decision for the sought-after talent rather easy. There’s no way you’re going to recruit someone away from another organization without offering a quality benefits package, and there’s little chance of holding onto a top talent for long without benefits good enough to keep him or her put.

Our job as brokers is to work with clients to make sure offered benefits fit within their budget while still attracting or retaining key personnel. It makes little sense to offer an overly rich benefits package that you can’t afford. But it makes a great deal of sense to offer a solid health insurance plan to your employees at a fair price. There are high-quality yet value-priced health care options out there that are still going to make your employees happy. That’s what a good broker helps you achieve as part of the broker-client partnership.

Make sure you can have open, honest communication with your broker to say something like: “Hey, times are tough and we need to tighten our belt. What other strategies can we utilize to not break the bank while still offering good benefits?”

If you’re an employee considering a new company, talk to an experienced broker or experienced professional who can help you determine which benefit offering will best serve you.

If you’re an employer or small business owner, don’t destroy your business offering unaffordable, unsustainable benefits. There are affordable alternatives out there that will allow you to still offer quality benefits and retain top talent without breaking the bank. And if you don’t have an experienced HR department or have offered the exact same benefits to your employees for years, you better have a good broker take a look under the hood. Chances are you’re paying much more than is necessary, and without a sound strategy in place you’ll suffer though huge premium increases on outdated offerings.

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COBRA & the Current Economy: What Happens When Your Company Goes Under?

If you’re terminated from your job or otherwise lose your employment, you automatically become eligible for COBRA coverage. But it’s not given to you. You have to elect it, and then you’re responsible for its hefty premiums. You also have a deadline for electing coverage and cannot miss a payment without running the risk of plan termination. COBRA also only lasts a set amount of time, so it’s important individuals are looking down the road to their post-COBRA coverage decisions.

Most people also don’t realize that if their former company goes out of business, COBRA coverage will die with it. If there’s no plan, there’s no COBRA. That also means if all the employees under a plan leave or are laid off, that plan—and its associated COBRA benefits—can be terminated.

And then what do you do?

Well, you’ve got to go find your own insurance. And people scramble—especially those with preexisting conditions. They’re all wondering, “How do I secure health insurance for my family?

The reality is people who are considered “uninsurable” by carriers don’t have many options. They either need to find a new job with group coverage or start their own business. (A business owner with at least two employees can secure a guaranteed-issue group plan). Unfortunately, a lot of people are otherwise uninsurable in a market that has only gotten more difficult. Carrier underwriters are extremely picky right now in terms of whom they’ll insure for individual/family coverage.

The most important thing for people in any of these scenarios to know is there are affordable options out there. People just aren’t aware how to find them … or if they’re eligible … or where to look. They should be getting help from their broker to do so—and to discuss all the options and strategies available to someone in their specific situation.

People should also be sure to use their broker for regular reviews of their individual plan to make sure it’s still the best option (with realistic premium levels) for current circumstances. When individual/family plan premiums skyrocket, a lot of times that person is eligible for a free transfer to a more affordable plan under the same carrier. Importantly, that switch can be made without having to again go through the underwriting process. Carriers just aren’t always quick to volunteer that information.

These are all issues and questions that a broker can answer in minutes, as opposed to the hours or days that it may take someone to call customer service lines and do research on their own. There are ways to secure coverage or lower premiums, but people need the help of a good broker to know how.

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How to Secure Affordable Health Care After Losing Your Job

Right now thousands of people are losing their jobs because of the rough economic conditions, and one thing that comes with that is the loss of health insurance.

With so many people out of work, a big question out there is: How do I secure affordable health care?

Quality health care plans are out there, but it’s an extremely difficult process to navigate on your own. The truth is it’s not easy to secure insurance right now in the individual/family (non-employee) market. You almost have to be in perfect health because of underwriting.

Any application has to be underwritten, which means carriers have the right of refusal. It’s up to the carrier do decide if it wants to take on the “risk” of insuring you. If you have any preexisting conditions, the chances are very slim a major carrier will take you on.

The bright side is if you are healthy (as an individual or a family), there are a lot of great, affordable plans out there, including a lot of the same plans you enjoyed under employee group coverage.

As a broker, I find a lot of people paying around $1,500 a month for family coverage who aren’t aware of vastly more affordable alternatives. This is often because they don’t have a broker for their non-employee coverage. They went direct—went online and picked a plan on their own. Now, they’re paying $1,500/month, for example, for coverage they rarely use when they could be on a high-deductible plan and paying around $500/month. They could be saving $1,000 every month in some cases and still have an excellent health care plan.

There are some really affordable plans out there right now. We recently put a healthy 18-year-old female in a plan that was only $70 a month. It’s a nice plan with great preventative care features. It has a high deductible, but she’s not going to pay a lot of money up front.

But unfortunately, there are so many people out there with the same healthy profile and circumstances who are paying far more (or have no insurance at all) because they’re unaware of their options and really need some help.

The issue is that often people simply aren’t aware that they can have a broker representing them for individual/family coverage without it costing them a penny. The carrier pays the broker in full, so there’s no disincentive whatsoever to having the expertise of a broker guiding you through the process of securing individual/family insurance. And even if someone has an existing plan, they can still assign a broker (just like with an employee group) to that plan without having to switch to something else.

It costs you nothing to work with an insurance broker. It doesn’t impact your rates in any way, so you should absolutely have and leverage a broker as your partner in your health care decisions.

This process can be so difficult to figure out on your own—especially now. There are so many plans out there and so many decisions to make. If you didn’t know where to look as an individual, you could search for days trying to understand what all the plans mean and what’s the best fit for you.

Some plan names and terminology can be misleading; you could think you’re going to be covered only to find out that what you bought on your own wasn’t what you thought it was. And terribly, most people find that out when in the hospital or submitting a big claim—when they have much more important things to focus on.

A broker can help you navigate your way through the approval process, find the right plan for you and your family and understand the benefits of that plan. Families can save money every month with the right plan, and in this economy the savings go a long way.

It’s just all about understanding what’s out there and what it takes to get covered when insurance isn’t guaranteed-issue. It’s not the friendliest market out there right now for individual/family coverage, but with a little help you can still end up in a great insurance situation.

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Taking Full Advantage of Your High-deductible Plan: Preventive Care

The most frequently talked-about reason for switching to a high-deductible health care plan is the premium savings. But there is also another element to these high-deductible plans that’s highly desirable: rich, useful and comprehensive preventive care benefits.

These services are covered at 100 percent and plan deductibles and HSA dollars don’t apply. So long as you go to an in-network provider and stay within the allowed frequency (some services are annual, etc.), these exceptional benefits are totally free.

Well-baby and well-child preventive care includes vision, hearing and lead exposure screenings as well as a host of free immunizations.

Adult preventive care includes vision, hearing and routine blood and urine screenings. But it also includes “less obvious” free services such as cholesterol and lipid level screenings, blood glucose tests for detecting diabetes, prostate cancer screenings, HIV tests, bone density scans and colonoscopies. There are also breast exams, mammography screenings, pelvic exams, pap tests and contraceptive management for females.

Just always be sure to check in with your doctor first so that you get the coverage to which you’re entitled. Call ahead, give the office your insurance information and ask if the services that interest you are covered in full at that time.

When you schedule a routine office visit, that’s a great opportunity to request additional preventive care services covered under your plan. Just always confirm that those benefits fall under your free preventive care.

Preventive Care Services: What’s In It for Them?

So, why are all of the major carriers offering all these no-charge preventive services with their high-deductible plans? Because they’re counting on these services keeping people healthier and detecting health issues before they become costly catastrophic problems down the road. A healthier America for them translates into fewer insurance claims. A healthier America for you means less time ultimately receiving medical care and a better-conditioned body to live the life you want.

These preventive care services are recommended by everyone from the American Cancer Society to the U.S. Preventive Services Task Force, but people aren’t utilizing these benefits nearly as much as you’d think.

On one hand, that’s because people aren’t used to services of this breadth and scope being truly 100 percent covered. They expect copays and deductibles and other charges to apply, so they stay away unless it’s absolutely medically necessary.

On the other hand, many people simply aren’t aware they’re entitled to these free preventive services with a high-deductible plan or aren’t clear enough about their benefits to feel confident using them.

We picked up a new client the other day that had super-rich preventive benefits as part of their existing plan, but they had no idea so much was covered for free because their last broker didn’t do any reviews with them. They had fantastic insurance but nobody in the group knew how to utilize it or when they could use it.

That’s why the role of the insurance broker is such a critical part of the process. A good broker is a good partner—reviewing or reminding clients about plan benefits and informing employees exactly how to best utilize their plan.

The goal is that hopefully you’re healthy and you don’t need to use you plan services very often, but when something comes up, you need to know what benefits you’re entitled to. It’s the broker’s role to keep people up to speed on how to best take advantage of their insurance.

Whether it’s on a quarterly, semi-annual or annual basis, our role as brokers is to continuously review with groups what benefits they have. That can be a quick highlight summary or a lunch-and-learn refresher meeting. Reeducating groups on little things such as plan usage plays a big role and goes a long way … and you’d be surprised how many people don’t realize or completely forgot what rich benefits are included and free with their insurance plan.

The more the broker can stay in front of people, the easier it is for those individuals to ask questions and find a comfort level. That’s our job as brokers: to be as available and proactive as is necessary to make sure people understand their benefits. And quite frankly, that’s a lost art in this business.

Remember that with employee benefits, the key word is “benefit.” Don’t hesitate to take advantage of what’s included in your plan.

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