Latest / Becker’s Payer Issues Podcast / ICHRA’s Rise and the Future of Employer Sponsored Benefits with Brandy Thompson

Transcript

ICHRA’s Rise and the Future of Employer Sponsored Benefits with Brandy Thompson · Becker’s Payer Issues Podcast

• 0:00
  Hi, everyone. This is Elizabeth Caslow with the
• 0:02
  Becker's Payer Issues podcast. I'm so happy today
• 0:05
  to be joined by Brandy Thompson, CEO of
• 0:07
  BenefitPay.
• 0:08
  Brandy, thanks so much for joining us today.
• 0:10
  Well, thanks for having me. Always a pleasure
• 0:12
  to be on Becker's.
• 0:13
  Of course. So glad to have you. So
• 0:16
  before we jump in, can you fill us
• 0:18
  in a bit more about yourself, your career
• 0:20
  background, and your current role at Benefit Bay?
• 0:23
  Yeah. I'm Brandy Thompson, the CEO of Benefit
• 0:25
  Bay. I come up the ranks from finance
• 0:27
  and accounting
• 0:28
  and had traditionally worked in more privately held
• 0:31
  businesses
• 0:33
  that were in various industries.
• 0:35
  So have been in construction, pork manufacturing, and
• 0:38
  specialty insurance.
• 0:39
  That really led me to be into my
• 0:41
  path today, which is as technology and health
• 0:44
  tech and fintech.
• 0:45
  Being a finance leader and operator, but also
• 0:48
  being a purchaser of benefits in those companies
• 0:50
  and being affected by that outcome is what
• 0:52
  led me to my journey here.
• 0:54
  So, I would love to jump into what
• 0:56
  Benefit Bay focuses on. So after ICRA has
• 0:59
  got the green light back in 2019,
• 1:02
  what did Benefit Bay see in that opportunity
• 1:04
  that others may have missed early on?
• 1:07
  Yeah. I
• 1:08
  think early on, it was seen as an
• 1:09
  SMB play. So I think that a lot
• 1:12
  were building for the small business, the subsidy
• 1:15
  advantage, for the on exchange policies,
• 1:18
  and they missed the wild opportunity for off
• 1:21
  exchange
• 1:22
  and building directly to the carrier to service
• 1:24
  a larger employer base and to preserve pretaxation
• 1:28
  and to facilitate most like a group experience
• 1:31
  for those other employers above the 51 life
• 1:34
  size,
• 1:35
  managing all the compliance that comes with a
• 1:37
  larger employer and applicable large employer and ALE,
• 1:41
  as we call them in our market. And
• 1:43
  I think overwhelmingly everyone was building for QSera,
• 1:45
  HRA, and an SMB
• 1:47
  type mindset.
• 1:48
  So I wanna ask about the large employer
• 1:50
  angle. So large employer adopt adoption is up
• 1:53
  34% and small employer adoption's up 52% just
• 1:57
  from 2024 to 2025
• 1:59
  according to the HRA Council. But some skeptics
• 2:02
  argue that ICRA is still a relatively small
• 2:04
  force in the industry and that large employers
• 2:07
  still have some concerns and are a little
• 2:09
  bit cautious. So what's your honest assessment of
• 2:12
  the barriers that might be holding ICRA back,
• 2:15
  when it comes to those employers?
• 2:17
  Yeah. I mean, I think there are some
• 2:18
  barriers.
• 2:19
  Benefit Bay is strictly a go to market
• 2:21
  through the broker channel tooling.
• 2:23
  We are a software as a service for
• 2:25
  the broker, and then we become the employer
• 2:27
  of an admin fintech health tech solution
• 2:29
  for their employee service. But what I see
• 2:32
  is holding employers back is a lot of
• 2:34
  misnomers.
• 2:35
  It is a lot about what the education
• 2:37
  is that's out there online.
• 2:39
  It talks about on exchange and subsidization
• 2:43
  of these policies
• 2:45
  and very much makes,
• 2:46
  large employers feel that their employees would be
• 2:48
  left to flounder on healthcare.gov
• 2:51
  or or HealthSherpa or one of these toolings
• 2:53
  that are out there for the on exchange
• 2:55
  side overwhelmingly. So I think it's an education
• 2:57
  challenge. I think, also,
• 2:59
  brokers didn't traditionally have the motivation to bring
• 3:02
  ICRA to the table. There's slightly less comp,
• 3:04
  more transparency in how those are being compensated.
• 3:07
  The contracting becomes very transparent in an ICRA.
• 3:11
  So they really have to have the consultant
• 3:13
  at the table who's bringing the right outcome
• 3:15
  for them and not motivated by maybe that
• 3:18
  compensation barrier there that could be driving them
• 3:20
  to sell against ICRA.
• 3:22
  What we've seen is there's a large adoption
• 3:24
  in large employers
• 3:26
  in the market. I think employers are becoming
• 3:29
  advocates, champions for choice.
• 3:31
  They have slowly peeled away their self insurance
• 3:34
  programs to try to point solution
• 3:37
  claims and cost
• 3:38
  to death, and they've now ballooned their self
• 3:41
  insurance program, and they're exhausted.
• 3:43
  So we've seen that the large employers are
• 3:45
  actually really willing to do this. Where we've
• 3:47
  seen there be some of a challenge is
• 3:50
  at the large national agency perspective,
• 3:53
  the
• 3:54
  agency is really concerned about losing the ability
• 3:58
  to control the group or the narrative or
• 4:01
  the solutioning that's at the table. So
• 4:03
  agencies really have to get a solution in
• 4:06
  place, and they have to be on
• 4:09
  for this transition because the employers are doing
• 4:12
  the research themselves.
• 4:14
  We get incoming leads every single day in
• 4:16
  the thousand to 5,000 life space. They're coming
• 4:19
  direct through our website. We then have to
• 4:21
  encourage them to introduce their agent to us
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  because we are only go to market with
• 4:26
  an agent at the table.
• 4:27
  Then that becomes a defensive sale for that
• 4:29
  agent, and all of that makes it a
• 4:32
  little bit more difficult. I think the HRA
• 4:34
  council data, it is accurate, but a large
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  portion of the HRA council members are in
• 4:38
  the SMP space. So several of those of
• 4:41
  us that do the larger
• 4:43
  weren't participating in that study. I joined back
• 4:46
  so that the data can start to reflect
• 4:48
  the large employer adoption, and I hope that
• 4:50
  some of the other
• 4:52
  technology solutions would participate
• 4:54
  in the data research so that we can
• 4:56
  show what those large employers really are doing
• 4:58
  out there in the market and have the
• 4:59
  numbers
• 5:00
  reflect the growth that we're seeing. We grew
• 5:03
  a 117%
• 5:05
  year over year in the large employer adoption,
• 5:07
  and now a large portion of our lives
• 5:09
  are over the thousand life space.
• 5:11
  Our average life count is still two seventy
• 5:13
  six, but that's because in the early days,
• 5:15
  it was a lot of the smaller adoption
• 5:17
  below 200. So it still skews your numbers,
• 5:20
  but that's it in enrolled count. So
• 5:23
  definitely moving up into the larger employer capacity.
• 5:27
  I wanna circle back and talk about, just
• 5:29
  as a follow-up, what strategies
• 5:31
  Benefit Bay is employing when it comes to
• 5:34
  engaging with and educating large employers?
• 5:37
  And then, also, how are you dealing with
• 5:40
  the, as you said, like, the defensive sales
• 5:42
  issues that might be coming up with their
• 5:44
  agencies?
• 5:45
  Yeah. So we we do a lot of
• 5:46
  thought leadership in the market. We go to
• 5:49
  where the chief human resource officer,
• 5:51
  the employee benefits
• 5:53
  specialist are located. We go to where the
• 5:55
  CFO councils are.
• 5:57
  We will be on panels or provide thought
• 6:00
  leadership.
• 6:01
  That thought leadership is always under
• 6:03
  getting people to ask the right questions of
• 6:05
  their agents
• 6:06
  and ensuring that they get the right outcome.
• 6:09
  ICRA should be at every table. If it's
• 6:11
  not cost effective, then the employer is not
• 6:13
  gonna make
• 6:16
  that choice. But as a consultant, they should
• 6:16
  be bringing all of the options for cost
• 6:17
  containment
• 6:18
  to the employer for the right outcome for
• 6:20
  their employees.
• 6:21
  And I also wanted to ask, you know,
• 6:23
  ICRA shifts the underwriting risk to the individual
• 6:26
  market. So how should payers be thinking about
• 6:28
  risk pool dynamics as ICRA adoption increases,
• 6:31
  and is this a threat or an opportunity
• 6:33
  for them?
• 6:35
  Yeah. I think it depends on who the
• 6:36
  carrier or payer is. We've seen that a
• 6:39
  lot of payers, payers like Kaiser,
• 6:42
  Geisinger, UPMC,
• 6:44
  Oscar, Ambetter, they're really aggressive in this market
• 6:47
  because, traditionally,
• 6:49
  with their products, they would not have had
• 6:51
  an employer group. Right? They would have had
• 6:53
  an employer group. If they were located in
• 6:55
  the Kaiser, you know, region, they would have
• 6:57
  had an employer group.
• 6:59
  They would have had individual policies possibly in
• 7:01
  a small SMB group, but they wouldn't have
• 7:03
  had access to these employers
• 7:06
  that are maybe corporate headquartered in Boston, but
• 7:08
  have employees in 48 states. Right? And so
• 7:11
  they're seeing a massive adoption, and they have
• 7:13
  a high motivation to get access to those
• 7:15
  lives and see that growth within their populations.
• 7:18
  They also have competitive products that can compete
• 7:21
  against the buccas.
• 7:22
  We saw early
• 7:24
  on that the buccas were not really favorable
• 7:27
  for ICRA. They were
• 7:28
  feeling as if it was going to cannibalize
• 7:30
  their group commercial group business. They weren't wanting
• 7:34
  to really
• 7:35
  put their, you know, flag in the race
• 7:37
  or, you know, get up there at the
• 7:38
  starting line. But what we've seen is now
• 7:40
  they've seen,
• 7:41
  okay. Actually, this is cannibalizing our group, but
• 7:44
  we're not in the game to ensure we're
• 7:46
  still able to retain
• 7:48
  the individual policy when the employer moves to
• 7:51
  choice.
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  And
• 7:53
  even those who tried to make the service
• 7:55
  more difficult or the outcome more difficult are
• 7:58
  really moving their technology investments forward. So I
• 8:01
  think for overall, ICRA took a few
• 8:04
  years for everyone, depending on the side of
• 8:06
  the aisle, to understand
• 8:08
  that this is the evolution of employee benefits,
• 8:11
  and the employers are on board with this.
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  I think there was a misnomer early on
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  that large employers would never do this and
• 8:17
  that they wouldn't take this on because it
• 8:19
  would be hard to allow everyone to choose.
• 8:22
  I think now we know
• 8:24
  employees are able to make complex decisions. Most
• 8:27
  of us do our own taxes. Right? We
• 8:30
  can do a once a year transaction that
• 8:31
  benefits our family. We can fiduciary make the
• 8:34
  right decision for retirement.
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  We can make the decisions for our health
• 8:38
  care, and we should be doing that. And
• 8:40
  it should be our business and our data,
• 8:42
  not our employer's business and their data.
• 8:45
  And and I think that that's that's what
• 8:47
  we're seeing as a as a true shift.
• 8:50
  And if employees have a physician they want
• 8:52
  to stay with,
• 8:53
  they can stay with that physician as they
• 8:55
  contract and move around or a medical center.
• 8:58
  Right? They can they can make sure they're
• 8:59
  making that decision every year with their physician.
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  And I think that's the part I'm really
• 9:03
  passionate about, the actual access to care. When
• 9:05
  we're all working in health care, not there
• 9:07
  aren't very
• 9:08
  many opportunities that we talk about. How do
• 9:10
  we improve access to care, service outcomes? How
• 9:13
  do we put the consumer in the driving
• 9:14
  seat with their dollars. Right? These are the
• 9:16
  things that I'm most passionate about evolving once
• 9:19
  we get everyone,
• 9:20
  really moving the market forward. And I think
• 9:22
  that we're at that pivotal acceleration.
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  So I wanna ask, you know, where do
• 9:27
  you see ICRA's and other alternative arrangements going
• 9:30
  in the next five years?
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  I think the I think we've seen a
• 9:33
  lot of fiduciary lawsuits lately. Right? So I
• 9:35
  think the employers are gonna get smarter about
• 9:38
  asking. I think they're gonna be less scared
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  of change
• 9:42
  because it's it's really driving a change. I
• 9:45
  think, economically,
• 9:47
  pressures are abound, right, for employers, and so
• 9:49
  they're gonna be turning over every rock. And
• 9:52
  I think ICRA, any cost containment strategy that
• 9:54
  an an employer and a broker can work
• 9:56
  on to execute for the betterment of their
• 9:59
  employees in the future, I think employees are
• 10:00
  getting smarter, and they're gonna start demanding these
• 10:03
  things from their employer. And we all were
• 10:06
  on the HSA train, and now the high
• 10:08
  deductible health care is at $6,500
• 10:11
  deductible, and people don't really have access to
• 10:13
  care. Right? So there are some things that
• 10:16
  need to come around
• 10:18
  in the health care outcomes, or
• 10:20
  I don't know if there are gonna be
• 10:21
  very many practicing physicians that are gonna wanna
• 10:23
  continue to go into this market
• 10:25
  as well. So we have to improve our
• 10:27
  health care outcomes, and I think that there's
• 10:28
  gonna be a lot of a lot of
• 10:30
  these things to improve it in the future.
• 10:32
  As we wrap up, is there anything else
• 10:34
  that you wanna say to industry leaders regardless
• 10:36
  of whether or not they're in this space
• 10:38
  or they're a little bit threatened by it?
• 10:40
  Where what advice do you have for them?
• 10:43
  Yeah. I just think it's being open minded
• 10:45
  that
• 10:46
  there are alternative solutions that can support the
• 10:49
  outcome for your business if you're an employer,
• 10:51
  And just be open minded and take a
• 10:53
  look and look under the covers and see
• 10:54
  what it looks like. It's free to look,
• 10:56
  right, at at alternative solutions. I think for
• 10:59
  agents, it's it's stop being scared and get
• 11:02
  out there and learn it so that you
• 11:03
  can have an additional tool to pull from
• 11:06
  and educate your employers with. And I think
• 11:08
  for the payers and for
• 11:10
  the health carriers,
• 11:11
  you know, really understand it and see the
• 11:14
  adoption, understand the administrators, understand
• 11:17
  how this is being delivered, understand the risk
• 11:19
  that are there, understand the opportunity. Right? So
• 11:22
  get in the game. Start to build your
• 11:24
  business cases for where you need to make
• 11:25
  the investment. That would be that would be
• 11:27
  my advice. Well, Brandy, thank you so much
• 11:29
  for joining us today.
• 11:31
  Thank you.