By Colin Sheehan, RCS Reporter.
On this very exciting Roofing Road Trips, Heidi hands the mic over to Tom Shanahan, NRCA risk manager to ask Ted Ryan all about NRCA’s new health care program. The two discuss the differences between self-insurance and fully insured health care options as well as the importance of understanding how insurance affects your bottom line.
Tom Shanahan has been with NRCA for 31 years and deals primarily with health, safety and insurance-related issues that face the roofing industry. NRCA and its insurance board of governors have been looking into offering health-related programs that have taken a variety of forms throughout the years.
“Some [health programs] have worked well and some haven’t,” said Tom. “Throughout all of that, we’ve learned a whole lot about navigating the laws and regulations that have to do with having a national program.”
Ted is the executive vice president for business development for Vault Strategies, a health insurance company. He is also the program manager for the NRCA health care program. Tom and Ted have been reaching out to contractors everywhere about this revolutionary health care program and have noticed a widespread lack of understanding about the differences between health insurance products and options that are available to roofing contractors now.
Ted explains that most contractors are insured by a traditional insurance company where they “write one check a month for all your employees that covers their claims.” However, at Vault Health Strategies their approach to health insurance is through self-funding. Self-funding, like self-insured or self-insurance describes an insurance option whereby the buyer pays for what they use and accepts some risk usually taken on by the insurer on a traditional insurance plan.
“So when you're dealing with a fully insured product from Blue Cross Blue Shield, United Health Care, Aetna, Cigna, etc., 100% of the risk is with those insurance companies and that's why their premiums are more expensive. When you're in the self-funding environment, the employer is taking on a portion of the risk. Importantly, however, it is still capped by an insurance policy. However, if the employer has a healthy population, then we're going to end up reducing their premiums that they're paying and thus the cost of their healthcare,” explains Ted. In fact, the company might even receive a premium refund the next cycle, if that is the case.
Part of what NRCA wants to offer with their health care program is member assistance. The NRCA program can evaluate a member’s current healthcare benefits and go through alternative options, like self-funding that could save them in the long run.
“We have products and services that will be a great fit for most members. And we can help save them a lot of money,” said Ted. “I've even had instances where we've offered a very competitive offer and an employer has chosen to stay with their existing carrier because that carrier, while they were going to go up 10% on the employer, the insurer decided to lower the renewal cost of the existing health plan. I don't want people to shop us that way, but the fact of the matter is NRCA’s effort still ends up as a member benefit, right? The more you shop and the more competitive folks are, and in sharing that information, you're naturally going to be the beneficiary.”
Tom added that what is exciting about the Vault self-funding programs is it truly allows a contractor to better manage their health care costs. Once a contractor understands that through these Vault products, their company may get premium back AND/OR a rate reduction the following year IF they better encourage and manage their claims experience, it can be a game changer—you’re no longer at the whim of the broker’s annual list of premium amounts. You have some skin in the game and it not only feels but is better to know that.
Listen to the full podcast to learn more about the NRCA health care program and the many insurance options available to you now.