America's Benefit Specialist November 2022

Reasons to Consider Self-Funding Debunking FSA Myths Hybrid Open Enrollment

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All insurance policies and group benefit plans contain exclusions and limitations. We recommend you consult the policy for coverage and benefit details. GeoBlue is the trade name of Worldwide Insurance Services, LLC (Worldwide Services Insurance Agency, LLC in California and New York), an independent licensee of the Blue Cross and Blue Shield Association. GeoBlue is the administrator of coverage provided under insurance policies issued by 4 Ever Life International Limited, Bermuda, an independent licensee of the Blue Cross Blue Shield Association. INDV2014-BRK-6/21

N o v e m b e r 2 0 2 2

YOUR INDUSTRY

5 Noteworthy 10 Recent Mergers and Acquisitions 16 Debunking FSA Myths in Preparation for the Use-It-or-Lose-It Deadline Courtesy of Health-E Commerce

14 How Employers Can Plan for Hybrid Open

Enrollment By Phil Mason

18 Product News 25 Industry Events 26 People on the Move

16

MEDICARE MATTERS 29 Overview of the Medicare Marketing Final Rule By John Greene

31 Milliman: A Healthy 65-Year-Old Would Spend Between

$137,000 and $300,000 on Healthcare Costs in Retirement

30 CMS Releases 2023 Medicare Parts A & B Premiums and Deductibles and

32 After Congress

31

Fails to Add Dental Coverage, Medicare Weighs Limited Benefit Expansion By Susan Jaffe

Income-Related Monthly Adjustment Amounts

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MEDICARE MATTERS CONT’D

33 Medicare Conferences

36 Items and Services Not Covered under Medicare By John Greene 37 AHIP Study: Medicare Advantage Costs Less than Original Medicare

33 CMS Releases 2023 Medicare Advantage

and Part D Star Ratings to Help People with Medicare Compare Plans

34 Medicare Advantage vs. a Medicare Supplement Plan: Helping New Beneficiaries Decide By Margaret Stedt

38 Plan Updates

37

YOUR SALES

45 Voluntary Disruption Why the Direct-Pay Model Is Better for Broker Compensation By Eric Silverman

48 The Benefits of Quoting a Level-Funded Plan By Daniel MacLeod 50 The Value of Tackling Healthcare Costs for Employers By Jim Holder

48

46 Note to Self: Four

Reasons Your Clients Should Consider Self Funding By Drew Burns

YOUR ASSOCIATION

58 NAHU’s Board of Trustees

52 New Infographic

54 Congratulations,

59 Your NAHU Staff

Registered Employee Benefits Consultants!

50

60 Association Events

55 Welcome to NAHU

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Correction : In the list of 2022 NAHU Award winners in the August/September ABS, we missed one: The New York AHU earned the State Website Award.

VOLUME 69, NO. 9

EDITOR Martin Carr (202) 595 0724

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The Rise of Telehealth Examining the Insurance Workforce Strategies for Reducing Prescription Costs

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BENEFIT SPECIALIST A AM E R I C A’S I Th e O f f i c i a l P u b l i c a t i o n o f t h e Na t i o n a l A s s o c i a t i o n o f H e a l t h Un d e r w r i t e r s

CONVERT THE LOW-HANGING FRUIT IN YOUR BOOK OF BUSINESS

Solving Compliance Problems Managing Remote Employees NAHU Award Winners

April 2021

NAHU’S LEGISLATIVE SUCCESSES

Anatomy of a Bill Medicare Matters Value-Based Care

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The opinions expressed in this magazine are not necessarily endorsed by NAHU nor does the magazine assume responsibility for statements made in advertisements or published articles. Send editorial submissions to: America’s Benefit Specialist Editor, 999 E Street NW,

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Suite 400, Washington DC 20004. America’s Benefit Specialist (ISSN 2475-5826, publication no. 238660), 2022, volume 69, number 9 Published 10 times per year (January/February, March, April, May, June, July, August/September, October, November and December) by the National Association of Health Underwriters, 999 E Street NW, Suite 400, Washington DC 20004. $25 annual subscription price is included in NAHU member dues. Periodical postage paid at Washington DC and additional mailing offices. POSTMASTER: Please send address changes to America’s Benefit Specialist, 999 E Street NW, Suite 400, Washington DC 20004.

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WORKPLACE LIFE, DISABILITY AND SUPPLEMENTAL HEALTH PREMIUMS REBOUND New annualized premium for workplace life insurance, disability insurance and supplemental health products increased in the second quarter, according to LIMRA’s workplace benefits sales surveys. “After a sluggish first quarter, sales for workplace life and disability insurance prod ucts experienced solid growth in the second quarter,” said Patrick Leary, corporate vice president and director of LIMRA workplace benefits research. “Despite inflationary concerns, the awareness among employees of the need for insurance coverage remains even after their concerns about COVID-19 have waned, which helps explain the contin ued growth in certain voluntary products.” Life Insurance: Overall, U.S. workplace life carriers wrote $587 million in total new annualized premium sales in the second quarter, eight percent higher than second quarter 2021. Through the first six months of 2022, new workplace life insurance annu alized premium totaled $2.2 billion, falling three percent from the same period in 2021. “Term life insurance sales makes up the large majority of total group life insurance premium and drove the growth in the second quarter. Workplace term premium increased nine percent in the second quarter but could not overcome the declines in the first quarter. As a result, term premium fell four percent in the first half of the year,” s aid Leary. Permanent life premium increased three percent in the second quarter and five percent in the first half of 2022. Permanent life products hold 15% market share of the workplace life insurance market. Disability Insurance: Total workplace dis ability insurance new annualized premium jumped 10% in the second quarter to $629 million. Despite the strong premium growth in the second quarter, first half workplace NOTEWORTHY

continued work-from-home policies, the tight labor market and shifting demograph ics on employee benefits offerings. The company’s first ever benchmarking report, which analyzed benefits data from more than 20,000 employees across the U.S., found that traditional health and wellness benefits such as fitness, nutrition, mental health, and spa, beauty and massage were the most popular offerings across companies of all sizes. In a nod to changing employee needs and pref erences, the study also uncovered a host of new creative and flexible benefits to support employees are also top of mind, including pet care, food, parental support, tuition reim bursement, and travel and vacation benefits. “Employees today want to work for organizations that value their well-being, so it makes sense that companies are search ing for new ways to prioritize employee wellness, especially as remote and hybrid work blurs the line between work and home. Our study findings show clear signals that companies are seeking to provide benefits that are highly personalized and flexible,” said Jaclyn Chen, CEO of Benepass. Based on an analysis of benefits data from large, medium and small U.S. busi nesses representing 20,000+ employees, the 2022 Benepass Benefits Benchmarking Report found: The Rise of Flexible Spending Accounts and Dependent Care FSAs: Of the various types of pre-tax accounts, FSAs are the most popular. DCFSAs ranked second. During the pandemic, parents faced the stress of working from home while their chil dren were in the next room due to closed daycares and schools, raising our overall consciousness of what it means to be a working parent. The popularity of DCFSAs suggests employers continue to explore how to support parents so they can be their best, most productive selves at work. Wellness perks most popular offering at large, midsize and small organizations:

disability premium was $2.1 billion, down four percent compared to prior year. “Premium increases in the second quarter were widespread, with two-thirds of carriers reporting gains, driven in large part by the employer-paid product lines,” Leary said. “After the past couple of years, our research suggests that employee demand and height ened recognition for the value of life insur ance and disability insurance will continue to rise over the next five years. However, a potential recession and other economic factors present headwinds to an otherwise positive outlook.” Supplemental Health Insurance: Total workplace supplemental health insurance product premium, which includes accident, critical illness, cancer, hospital indemnity insurance and other health supplemental health insurance products, was $485 million in the second quarter, nine percent higher than the same period in 2021. For the quarter, all supplemental health product lines recorded positive premium growth: Accident insurance grew six percent, critical illness climbed eight percent, cancer insurance improved nine percent and hospi tal indemnity experienced 10% growth. New annualized premium for workplace supplemental health products increased 10% in the first half of 2022 to $1.6 billion. LIMRA’s workplace benefits sales surveys for life insurance, disability insurance and supplemental health represent at least 90% of their respective annualized premium markets. The latest data table with U.S. workplace sales trends can be viewed at www.limra.com/en/newsroom/fact-tank/. STUDY ON WORKPLACE BENEFITS SEES WIDESPREAD ADOPTION OF CREATIVE BENEFITS TO SUPPORT WELLNESS AND MENTAL HEALTH A new benchmarking study from Bene pass illustrates the impact of the pandemic,

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for meals, cleaning services, trash pickup or water treatments. Technology companies are big spenders when it comes to buying employees meals, spending on average $123/ month on the popular perk. This compared to healthcare companies, which are spending on average $25/month on food perks. Rise in experiential perks to meet prefer ences of Gen Y and Gen Z: Some companies provide entertainment or cultural experi ence benefits to help pay for podcasts, music streaming services, concert or theater tick ets. This perk is particularly popular among tech companies, which pay on average $44/ month on this benefit. Other unique benefits that are particularly appealing to this demo graphic include travel benefits for employees to spend on personal vacations and rental homes or one-time rewards to celebrate new hires, birthdays or work anniversaries. Small businesses face pressure to match benefits of larger companies: The study found that while the dollar amount may be less, small businesses were by and large offering the same benefits as large and medi um-size businesses. “I think there’s an expectation from younger generations for more than just the traditional core offerings. They really want flexibility and choice, and they want their employer to meet them where they’re at. When you want high-performing employees, you need to make it easy for them to access the support they need, when they need it. I think it’s a generational shift and change from coming out of the pandemic; people are much more aware of and more vocal about their well-being,” said Kelly Wakefield, senior manager of global benefits at Moderna. To access the full report, visit: www.get benepass.com/ebooks/2022-benepass-bene fits-benchmarking-guide. REMOTE WORKERS STRUGGLE MOST WITH BENEFITS SELECTION While the majority of today’s workforce prefers remote work over going to the office, MetLife’s annual open-enrollment survey

Across all company sizes, and industries, the most popular types of perks are fitness and wellness, lifestyle spending accounts (LSAs) and work from home. On average, large companies are spending $177/month, medium-sized companies spending $108/ month, and small companies spending $67/ month on fitness and wellness benefits alone. Technology and healthcare organizations are both big spenders when it comes to fitness and wellness benefits, with technology com panies spending on average $111/monthly and healthcare organizations spending $117/ monthly on these perks. Lifestyle spending accounts are empow ering companies to expand the concept of wellness. LSAs, a relatively new benefit in the market, are non-salaried allowances that enable employees to choose how to best sup port their work-life balance and well-being. LSAs are fully funded by the employer and were developed on the basis that flexible, employee-led benefits lead to happier, more productive employees. The report found LSAs to be the second-most-popular perk among all companies, with 37% of compa nies offering it and providing an average of $171 in flexible monthly funds. Given the newness of this perk, many companies also struggle to design the core eligible spend ing categories. While traditional wellness pillars such as fitness, nutrition and mental health made up the bulk of eligible spending categories, the inherent flexibility of LSA ac counts has empowered companies to expand their well-being support to include spas, food, pet care, travel and vacation, profes sional development, tuition reimbursement and parental support. WFH perks remain popular and go well beyond buying a desk: Regardless of benchmark segment or industry, many employers provide $500 to $1,000 in work from-home benefits, which allows employ ees to purchase high-cost items like a new desk or office chair. With the continued trend toward WFH, the report saw increas ing creativity on the part of employers to support employees at home including paying

found location may impact much more than just the daily commute. The survey found that over half of the remote workforce (55%) are highly anxious about their finances (vs. 46% of hybrid and on-site workers) and that this group spends more time worrying about their benefits (55% spent over one hour per week vs. just 37% of on-site and hybrid employees). “Benefits play a major yet often over looked role in employees’ overall financial health. A lack of understanding of benefit options is only compounding the finan cial insecurity remote workers feel today,” said Bradd Chignoli, senior vice president, Group Benefits at MetLife. “Benefits can provide financial stability in times of eco nomic turbulence and, when used the right way, are a tool that can even lighten employ ees’ financial burdens and anxiety.” As the workforce continues to change post-pandemic, meeting employees’ diverse needs—including location—is a growing chal lenge. MetLife’s survey indicates potential gaps in communication to the remote workforce. Two-thirds of remote workers (65%) say that a better understanding of open enrollment would help make them feel more financially secure. Potential gaps exist in benefit education for these employees. Con sequently, remote employees are two times more likely to say they enrolled in the wrong type of benefits last year, and require more information to make the right benefit choices (57% vs. 47% of hybrid and on-site workers). MetLife’s data also finds that employ ees who understand and actively utilize their benefits are more loyal, thus proving beneficial for employee retention. Three in five fully remote workers (61%) say their employer’s benefits are a significant part of what’s keeping them at their company, and this is even higher for work-from-home caregivers with children under 18 (72%) and Millennial/Gen Z workers (67%). The state of an employee’s financial well-be ing is often directly linked to their benefits usage. In fact, 43% of all employees say their benefits have helped them out of financial dif-

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according to a new report from LendingTree research site ValuePenguin. The key findings: • More than 440,000 workplace injuries happened to workers not covered by employer-based insurance—or for one in three victims. While 67.7% of employees were covered by employer-based insur ance, workers who had to take time off due to a workplace injury were 7.8% less likely to be covered. • Americans working in jobs that have the highest rates of workplace injuries are less likely to have employer-based health insurance. In the farming, fishing and forestry industry, which has the highest injury rate, at 33.4 of every 1,000 workers, only 36.7% of workers have employer- based health insurance. • Sixty-four percent of the 25 occupations with the highest average annual fatality rate between 2017 and 2020 earned less than the national weekly median. In fact, workers in occupations with the most workplace fatalities earned an average of 7.9% less than the average American. • Half of the 10 states with the most workers in dangerous occupations were in the West. Overall, Wyoming ranked first, with 5.8% in the state working in the top 10 most dangerous occupations. Comparatively, states on the East Coast ranked among the lowest, leading with the District of Columbia (0.6%). The full report and methodology can be found at www.valuepenguin.com/work place-injuries-insurance-study. EMPLOYERS EYE INSURANCE BENEFITS AS A WAY TO ATTRACT, KEEP TALENT Facing a historically tight job market, many employers are looking to bolster their work place benefits to attract new talent and retain their existing workforce. In a LIMRA survey of U.S. private employers with 10 or more employees, 60% said they are considering

ficulty this year, and 44% say they have helped improve their overall financial health. “We’re at a critical moment in the em ployee-employer relationship. As we look to build more inclusive cultures and further support today’s workforce—including how and where our employees work—benefit communication is vital,” said Jenn Kischell, vice president, Workforce Engagement at MetLife. “In today’s volatile economic environment, ensuring workers understand and use their benefits is more important than ever for employees’ well-being, as well as overall retention.” AKASA, a developer of AI for healthcare operations, released findings from a new survey conducted on its behalf by YouGov, which highlights how patients often do not shop around for healthcare service pricing because they are unaware of publicly avail able pricing information is or do not believe there is competition in healthcare because of limited transparency. Respondents were asked: “Have you ever tried looking for prices for care or services needed?” The survey of more than 2,000 Americans found 64% have never sought out pricing for healthcare services. When looking deeper into the data, younger adults (18-34) tend to be more likely to research prices (45%) for healthcare services vs. older adults 55+ (27%). Addi tionally, patients with high-deductible health plans (41%) and individual plans (43%) are more motivated to research healthcare pric ing information than other groups. Additionally, respondents were asked: “Would knowing the price of care or ser vices ahead of time encourage you to shop around?” The survey found 58% of Ameri cans would be encouraged to shop around if pricing information was disclosed before nec essary healthcare procedures and services. MAJORITY OF HEALTHCARE CONSUMERS CONDITIONED TO NOT SHOP AROUND FOR THE BEST PRICE

“There’s clearly a gap between what many healthcare organizations—providers and insurance companies—think helps increase price transparency and the experience of patients in finding price information conveniently and in a manner that is easy to understand,” said Amy Raymond, VP of rev enue cycle operations at AKASA. “This is a deterrent for patients in seeking out the best price like they would in any other industry, which can be incredibly frustrating. In the survey, 36% indicated they have researched prices for healthcare services. Of these individuals, 60% would look to their insurance provider for pricing information, with nearly half (44%) reporting they would look on the websites of health insurers, and more than a quarter (29%) would call their health insurance company. (Respondents could select more than one option): • 44% would try looking for pricing infor mation on the health insurance company website • 39% would visit a physician or hospital website • 34% would opt to call their physician or hospital for pricing information • 32% would access a patient portal for the information • 29% would call their insurance company Additionally, 44% of survey respondents say their health insurance company does not provide pricing information for local healthcare providers, and 34% don’t know if this information is available. OVER ONE IN THREE WORKPLACE INJURY VICTIMS DON’T HAVE EMPLOYER-BASED HEALTH INSURANCE Employer-sponsored health insurance is supposed to offer access to affordable health care to Americans of all social and economic classes. Sadly, employer-sponsored health insurance is not common among employees who face a higher risk of workplace injury,

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erage and benefits that American families depend on for their health. The report from Avalere looks across in dustries at trends that drive ROI higher and lower. Avalere highlights the manufacturing industry as an example, finding American manufacturers see an ROI of 42% on their ESI programs. “Employee-sponsored health insurance is a win-win for employers and employees,” said Katie Mahoney, vice president of health policy at the U.S. Chamber of Commerce. “We know employees place a high value on quality health insurance in the work place, and now we have more evidence that employers benefit significantly from investing in these programs as well. Em ployer-provided coverage is the backbone of the American healthcare system, and this report reinforces that any reforms should build off this model that is good for workers and companies alike.” “Improving productivity and wellness make America more competitive and prosperous,” said Joel White, president of the Council for Affordable Health Cover age. “While employers offer health coverage to improve the health and welfare of their employees, employees and their families benefit significantly. This study shows that Congress and the Administration must work to expand job-based coverage, not weaken it. The study, which examined employers with 100 or more employees, defined ROI as “the monetary value of benefit for each dollar employers invest in healthcare cover age. Investment in ESI may include health insurance premiums, wellness programs, direct medical expenses, administrative costs associated with processing medical claims, and other costs associated with providing health insurance. Avalere calculated the ROI derived from ESI by dividing the total em ployer benefits by the total costs of providing ESI.” The full report, including methodol ogy, can be found at www.uschamber. com/assets/documents/20220622_

introducing at least one new non-insurance option to address a wider array of their workers’ needs. While salary and bonuses remain a primary way to attract and retain workers, LIMRA’s study shows many employers are placing heightened emphasis on other com ponents of total compensation. Providing enhanced benefit options and greater job flexibility appeals to job seekers while also helping to retain key employees. EMPLOYER-SPONSORED HEALTH INSURANCE PRODUCES A 47% RETURN ON INVESTMENT FOR AMERICAN BUSINESSES Employers in the United States this year will earn an average return on investment of 47% from their employer-sponsored health insurance (ESI) programs, according to a new study from Avalere Health. This means for every dollar spent on ESI, employers get back $1.47 in financial benefits. The analysis from the health data firm finds that the aver age ROI is projected to grow to 52% in 2026, and that businesses that invest more in their ESI programs tend have a higher ROI. While providing employees high-quality health insurance is the right thing to do for workers, the report shows how it makes business sense. Avalere attributes the direct financial return for employers to lower direct medical costs, increased productivity, lower recruitment costs, stronger reten tion, lower short- and long-term disability costs, as well as tax benefits. More than 155 million Americans currently get their health insurance through ESI. The study was commissioned by the U.S. Chamber of Commerce on behalf of the Protecting Americans’ Coverage Together (PACT) campaign. PACT members, includ ing the U.S. Chamber of Commerce, Busi ness Roundtable, The National Association of Manufacturers, Council for Affordable Health Coverage and Vermeer Corporation, represent leading employer voices focused on strengthening the employer-sponsored insurance system and protecting the cov

adding a new insurance benefit within the next two years—roughly double the interest employers expressed five years ago. More than one in four businesses express strong interest in introducing at least one new type of insurance option to their workforces. Four in 10 midsize and large companies are very interested in offering new insurance benefits within the next two years. If all of these organizations follow through, approximately 784,000 employers will introduce a new insurance benefit over the next two years, reaching more than 86 million employees. Today, more than 80% of private employ ers with 10 or more workers offer at least one insurance benefit, with major medical plans most commonly available to employ ees. Dental (55%), life insurance (48%), vision care (47%) and short-term disability (47%) round out the top five benefits offered by employers currently. When it comes to new benefits employers are considering, disability (both short- and long-term) and vision care benefits were mentioned most often. Businesses that do not currently offer insurance benefits are most often considering adding major med ical coverage. Employers with no existing insurance benefits are also looking to add dental insurance, life insurance, short-term disability and vision care coverage. This aligns with what workers value, according to recent LIMRA research. In the 2022 BEAT Study: Benefits and Employee Attitude Tracker, more than half of workers cite medical benefits as one of the top five factors they look for in an employer, and more than a quarter prioritize other insurance benefits, such as life, disability or dental insurance. Beyond insurance benefits, employees are interested in adding non-traditional benefits, such as work flexibility, caregiving benefits and wellness programs. Given the current competition for talent, coupled with the increased emphasis on job flexibility among workers, the study finds more than half of employers (53%) are interested in

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Chamber-of-Commerce_ESI-White-Pa per_Final.pdf. SURVEY FINDS HEALTH CARE PLAN COSTS EXPERIENCED STEEPEST CLIMB IN A DECADE Healthcare spending in 2021 spiked an average of 14% per covered participant, the highest increase in a decade. The surge was primarily driven by the return of previ ously deferred medical care and the uptick of COVID-19 vaccines and therapeutics, according to data released by benefits and HR consulting firm Segal in its 2023 Health Plan Cost Trend Survey. In the 26th annual survey, respondents reported 2023 trend forecasts as well as actual health cost trends for 2021 for medical, prescription drug, dental and vision coverage, based on group health plan experience. Last year’s medical actual plan cost increase was nearly double the projected rise of 7.7%, a stark contrast to the -2.1% medical trend rate experienced in 2020. This survey of employer-sponsored health plans also not ed that per employee monthly medical claim costs is forecasted to increase at a rate of sev en to eight percent in 2023. The survey found that forecasts for annual prescription drug costs increases are approaching almost 10%. Specialty drug prices, which now account for 55% of pharmacy benefit costs, are projected to increase by 13.5% as more expensive med ications are introduced to the market. “Inflation is at a 40-year high and is expected to drive up medical plan costs in 2023. While the full effect of inflation on health care costs may not yet be realized, it is expected to impact medical trend rates in the next year,” said Eileen Flick, senior vice president, director of health technical ser vices at Segal. “Continued pressures on the healthcare sector related to health profes sional labor supply shortages and demand for greater wage increases, combined with the acceleration of new to market high-cost technologies and treatments, are likely to drive higher health care cost trends in the next several years. Plan sponsors should ex

1.4% from 7.8% reported in the 42nd survey. Notably, this trend-factor slowdown in the current year is impacted by higher-than-nor mal healthcare activity in the prior year, due to pent up demand from COVID. Medicare: The trend factor for plans that supplement Medicare (excluding prescrip tion drugs) was 5.6%, up from 5.0% in the prior year. This follows six consecutive in creases from 3.0% reported in 2018. Respon dents attributed the increase to COVID-19 and unfavorable claim experience. Notably, these trend factors are still lower than trends for plans covering active employees and reflect Medicare’s ability to limit its payment rates to participating providers, rates which “spill over” to Medicare supplement plans. Prescription drugs: Health insurers reported a weighted average prescription drug trend of 8.1%, representing a steady decline from 9.3% in the 41st survey and 8.8% from the 42nd survey. In contrast, the weighted average trend reported by pharmacy benefit managers in creased by 1.3%—from 6.2% to 7.5%. As with medical, some respondents cited COVID-19 as influencing their trend projection. Health insurers use trend factors to cal culate premium rates, and large self-funded employers use trend factors to budget their future healthcare costs. In general, trend factors provide for price increases that may result from such variables as inflation, utili zation of services, technology, and changes in the mix of services. Employers could see premium rate increases that differ from the factors summarized in this report, as the final premium rate increase reflects other factors, such as changes in benefit design and recovery of prior period losses. For more information, visit www.buck.com. CRITICAL ILLNESS INSURANCE MARKET SURVEY RESULTS Gen Re has released results of the U.S. Crit ical Illness Insurance Market Survey. This annual survey covers traditional individual, group/worksite critical illness (CI), and acci dent products. The majority of new CI sales Continued on page 25

pect higher health plan cost increases which put added pressure on overall compensation costs in the near term.” The 2023 Segal Health Plan Cost Trend Survey polled health insurers, managed care organizations, pharmacy benefit managers and third-party administrators. SURVEY SHOWS CONTINUED INCREASES IN HEALTHCARE COSTS FOR EMPLOYER SPONSORED PLANS Buck, an integrated HR, pensions and employee benefits consulting, technology and administration services firm, recently announced findings from its 43rd Nation al Healthcare Trend Survey of nearly 100 health insurers and health plan administra tors covering over 100 million plan partic ipants. The survey identifies trend factors used by health insurers and third-party administrators to project employers’ future healthcare costs. The report found that although healthcare costs continue to increase, the rate of in crease has generally slowed across multiple categories such as medical and prescription drugs. Notably, the impact of the recent increase in prices is not yet reflected in the healthcare trend factors used by insurers to set premium rates. “Healthcare claims spiked in 2021 due to residual demand from COVID,” said Harvey Sobel, FSA, a Buck principal and consulting actuary who directed the survey. “While a temporary reduction in trends is welcome, activity is projected to normalize in 2022. Health plans will be under pressure to increase provider reimbursement rates in reaction to the rise in inflation as their provider contracts come up for renewal.” Medical trends: Health insurers and ad ministrators reported medical trend factors that vary by product, averaging 5.8% to 6.9%. This is down by one to two percentage points from the prior survey, indicting a slower rate of increase in healthcare costs over the prior year. Similarly, the average trend factor for the popular PPO plan was 6.4%, down by

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RECENT MERGERS AND ACQUISITIONS

to Warner Pacific’s proprietary quoting and enrollment technology tools and ongoing client service. “Mike and Colleen Stephens through Tallgrass have excellent reputations and we are proud to welcome them to our family of employees,” said Nelson. “This acquisition will enable us to expand our offerings in Oklahoma and deliver a broader range of products to agents there.” BENEZON JOINS MEDXOOM Medxoom, an enterprise health benefits and payments platform, has acquired Benezon, a benefits-navigation solution. Medxoom’s expanding reach across the health benefits ecosystem will now include additional virtual care, compliance, care-coordination and advocacy offerings. “We’re excited to be joining forces with Medxoom,” said Julian Lago, Benezon founder. “Together with Medxoom’s bene fits-integration and fintech capabilities, we now have a market-leading, comprehensive offering for our clients. Employers demand more of their healthcare benefits offering, and Medxoom unifies and provides all such capabilities.” Lago joins Medxoom as presi dent, group solutions. “We welcome the Benezon team to the Medxoom family. Julian and Benezon’s offerings have built a great reputation while serving the health benefits space; we are for tunate to be joining forces,” said Jeff Toewe, Medxoom founder/CEO. Medxoom licenses a white-label platform to TPAs, health plans and brokers. It unifies the healthcare benefits and payments expe rience, and is a solution for enterprise bene fits administrators seeking to reduce OPEX, deliver cost savings and offer a customized experience to their employer clients.

Medxoom, based in Atlanta, is backed by well-known fintech and healthtech inves tors, including TTV Capital, Las Olas VC and Castellan Group.

WARNER PACIFIC GROWS Warner Pacific, an employee benefits-fo cused general agency with locations in Texas, Colorado and California, recently announced its acquisition of Professional Insurance Concepts Inc., a Houston-based GA that has served the area for more than 40 years. Kirk Templin, PIC’s executive vice president, and his team will be joining the Warner Pacific family of employees. PIC broker partners will have access to Warner Pacific’s proprietary quoting and enrollment technology tools and its client service. TJ Templin, PIC’s vice president of administration said, “Warner has great tools and enrollment technology. We can’t wait to introduce and train our brokers on it.” PIC primarily offers Blue Cross and Blue Shield of Texas. When coupled with Warner Pacific’s new partnership with the health plan, the acquisition further supports Warner Pacific brokers in building their business. “Professional Insurance Concepts is well known for their excellent service and strong reputation in the Houston market,” said Warner Pacific co-CEO John Nelson. “They are a great bunch of people who are well in-tune with the market. We are proud to be joining forces.” In late September, Warner Pacific also acquired Tallgrass Benefit Solutions, an Oklahoma-based GA. Through the acqui sition of Tallgrass and its sister company, Scissortail, Warner Pacific is now able to offer Oklahoma brokers small-group, large-group, level-funded, individual and Medicare options. These additions build on Warner Pacific’s portfolio of products already available to brokers. Tallgrass owners Mike and Colleen Stephens will be joining the Warner Pacific team. Tallgrass’ broker partners will eventually have access

SENIOR MARKET SALES ACQUIRES OHIO FAMILY OF BUSINESSES

Senior Market Sales has acquired a family of full-service insurance businesses in Ohio spanning three generations of the Vic Ger ber Sr. family. SMS President Jim Summers said the acquisition preserves the legacy of Gerber and Associates founder Vic Gerber Sr. and allows for his son, Vic Gerber Jr., and Vic Jr.’s sons, Kyle Gerber, Victor (Max) Gerber and Clayton Gerber, to expand on their success serving Doylestown, Ohio, cli ents with annuities and life, long-term care and Medicare Supplement health insurance. Vic Gerber Sr. started his agency when Medicare first became available in 1965, building strong Medicare Supplement health insurance sales through customer service that fueled referrals. Vic Gerber Jr. has run the business in Doylestown for more than 40 years, leveraging SMS’ back-office support, marketing systems, and health and wealth carrier product portfolio. Kyle Gerber joined the insurance agency in 2009 and, with KJ Gerber & Company LLC in 2015, added investment and financial planning services, working as Gerber Advis ers, also in the family’s Doylestown office. Vic Gerber Jr. said being able to add com pany-provided benefits, including health insurance and 401(k) plans, drove the Gerbers’ decision to join SMS and Alliant Insurance Services, which acquired SMS in 2020. The family also liked that additional resources such as payroll administration and advertising support could free them

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continue to oversee operations and collabo rate with Choice to further its expansion. GPA CEO Michael Heidelberger said, “Building GPA was a labor of love for Steve and me, when it came time to find the right partner to continue our growth, we looked at many possible solutions. When we heard the Choice story, we knew we had found the right fit.” GPA COO Steven Roy shared, “We were looking for a strategic partner that of fered the support and resources we needed, and it was clear that we could develop that synergy with Choice.” The transaction between GPA and Choice closed on August 1 and represents the 10th acquisition for the Choice since partnering with Northlane Capital Part ners in October 2021. SAN DIEGO INSURANCE FIRMS TO MERGE EMPLOYEE BENEFITS PRACTICE C3 Risk & Insurance Services and B. Wood Insurance have joined forces to expand em ployee benefits plan services to current and prospective clients. The merger went into effect on October 1. The company will oper ate under the C3 Risk & Insurance Services name and deepen and diversify specialty expertise through the strategic partnership. Leaders of the two San Diego insurance companies began talks in 2021 when they realized their professional and personal circles overlapped in several areas. When they discovered the close alignment of their organizational values and how complemen tary their skill sets were, the partnership felt like the next right step for both firms. C3 offers personal and commercial lines of insurance, risk-management solutions and tailored employee benefits plans to businesses of all sizes. Merging with B. Wood Insurance adds 17 years of industry experience with an emphasis on employee benefits programs.

B. Wood Insurance co-founders and brothers Ben Wood and Bryan Wood will now be partners at C3 Risk & Insurance Services as a result of the merger. B. Wood Insurance is an employee benefits shop in Southern California, which accelerates the capacity of C3’s benefits division. HUB INTERNATIONAL EXPANDS EMPLOYEE BENEFITS CAPABILITIES WITH ACQUISITION Hub International Limited has acquired the assets of each of Peel & Holland Holdings Inc., Peel & Holland Inc., Riddle Insurance LLC, Hartin Dynamics LLC and Bluegrass Premium Finance LLC. (collectively, Peel & Holland). Headquartered in Benton, Kentucky, with six additional locations, Peel & Holland is a full-service, independent insurance agency providing property and casualty insurance, surety and bonding, family insurance and employee benefits plans. Peel & Holland leadership, including Roy Riley, president & CEO, Keith Riley, senior vice president, Skip McGaw, president of Riddle Insurance and Kelly Harding, vice president, and the Peel & Holland team will join Hub Mid-South. NATIONSBENEFITS TO EXPAND ITS FLEX BENEFIT CARD TECHNOLOGY NationsBenefits, a provider of supplemental benefits, flex cards and member-engage ment solutions for health plans, recently announced the acquisition of SoliSYSTEMS, an experienced technology integration vendor with a background in providing IT support to both state governments and commercial enterprises. This acquisition is part of the company’s strategic vision to expand its flex benefit card technology to meet the ever-growing needs of health plans

up to focus more on clients and could help them grow well into the future. FRANCISCO PARTNERS TO ACQUIRE BSWIFT FROM CVS HEALTH Francisco Partners, a global investment firm that specializes in partnering with tech nology businesses, has signed a definitive agreement to acquire bswift, a provider of benefits technology and services, from CVS Health. Founded in 1996, bswift is a provider of software and services that streamline ben efits and human resources administration, offering a cloud-based technology platform with service. The company combines its deep expertise and passion for technology innovation with customer service and a consumer-driven approach. bswift helps its partners and employers simplify adminis tration, manage employee benefits, reduce administrative costs, and connect employ ees with resources needed to achieve their health ambitions. bswift will continue to partner with CVS Health and Aetna, a CVS Health company, to provide benefits technology to its employ ees and client base. Since its launch over 20 years ago, Francisco Partners has invested in over 400 technology companies. CHOICE FINANCIAL GROUP EXPANDS INTO THREE NEW STATES THROUGH PARTNERSHIP Choice Financial Group (Virginia Beach, Virginia) has partnered with Georgia Pines Agency LLC, furthering its expansion and entering Florida, Georgia and Califor nia. GPA is a full-service agency with 12 branch locations that provide personal and commercial insurance to a variety of clients. Together with their team of 65, co-founders Michael Heidelberger and Steven Roy will

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maintaining personal relationships with carriers and healthcare providers, and they are deeply committed to the guidance and success of their team of agents. Additionally, Integrity has entered into an agreement to acquire Insurance Market place Agency, an IMO based in Portland, Oregon. Dianne Faligowski, CEO of Insur ance Marketplace Agency, will become a managing partner at Integrity. Faligowski immigrated to the United States from the Philippines in 2001 to create her own path to success. She founded Insurance Marketplace Agency shortly thereafter to provide Medicare and health insurance marketplace products in the Pacific Northwest. Since 2015, Insurance Marketplace Agency has been part of a select group hand-picked by the State of Oregon to receive grants to help residents find and access health benefits. The agency has expanded across multiple states, with a reputation for helping those community members who need it most. Finally, Integrity has entered into an agreement to acquire Gott Professional In surance Services, an IMO headquartered in Sacramento, California. Johnny Gottstein, president and CEO, will become a manag ing partner in Integrity. Gottstein founded GPIS in 2007 to help federal and state employees obtain and make the most of their benefits. Since then, GPIS has become a recognized national expert in the federal employee market and has expanded to provide insurance and financial services products to municipal employees and members of the military. The company’s systematic sales process thoroughly trains agents from marketing to sales support. GALLAGHER TO ACQUIRE M&T INSURANCE AGENCY Arthur J. Gallagher & Co. has signed a de finitive agreement to acquire Buffalo, New York-based M&T Insurance Agency Inc., an indirect subsidiary of M&T Bank Corpo

ration. In connection with the transaction, Gallagher will become the preferred insur ance broking partner of M&T Bank. The transaction is subject to regulatory approval and is expected to close this quarter. Founded in 1955 and operating under its current name since 2005, MTIA is a retail insurance agency offering an array of property and casualty products, custom ized group benefits and surety solutions to clients in the Northeast and Mid-Atlantic. John Rumschik, Bart Kresse, Zachary Howe and their teams will operate under the direction of Patrick Kennedy, head of Gal lagher’s Northeast region retail property/ casualty brokerage operations. CROSS INSURANCE ACQUIRES PATRIOT BENEFIT SOLUTIONS Cross Insurance has announced the acquisition of Patriot Benefit Solutions Insurance Agency based in North Andover, Massachusetts. Patriot Benefit Solutions is an employee benefits, health and welfare insurance brokerage firm that provides design, marketing and support services to employers of all sizes. The Patriot Benefit Solutions team will remain in North Andover and will operate under the name Cross Insurance with Dave Messersmith, president of Cross Insur ance-Coastal Region, serving as the regional president for Cross Insurance. Founded in 2003, Patriot Benefit Solu tions specializes in providing consulting and brokerage services for organizations of all sizes, from the unique needs of a small employer to the complex challenges of larger organizations. Since its founding in 1954, Cross Insur ance has grown extensively through the acquisition of more than 120 insurance agencies. The company now has 1,000 employees operating out of offices in Maine, New Hampshire, Vermont, Rhode Island, Massachusetts, Connecticut, New York and Florida.

with Medicare Advantage and Part D Plans for the year 2023 and beyond. “We are thrilled to welcome Roque Solis and his talented group of engineers to NationsBenefits,” said Glenn M. Parker, M.D., Founder and CEO at NationsBenefits. “Joining forces and expanding our technol ogy infrastructure enhances our flex benefit card offering with a national retail network.” The company’s flex benefit card solution, which will fall under the brand of Nations Flex, enables health plans to provide their members with a convenient way to pay for eligible items and approved services. Members receive a personalized debit card that gives them quick and easy access to funds that are loaded on a monthly, quarter ly or annual basis. In addition to flex card solutions, NationsBenefits will continue building its healthcare payments related product suite. Roque Solis will continue to lead this division as a part of NationsBenefits. INTEGRITY ANNOUNCES ACQUISITIONS Integrity Marketing Group LLC has entered into an agreement to acquire Anderson-Kent Insurance Agency, an independent market ing organization based in central Texas. As part of the acquisition, Jim Anderson, found er of Anderson-Kent, will become a partner and Boyd Kent, president of Anderson-Kent, will become a managing partner in Integrity. A mainstay of the insurance industry in Texas, Jim Anderson has been serving Americans for more than six decades. In 2012, he partnered with Boyd Kent, an industry veteran with more than 35 years of experience, to establish Anderson-Kent to help guide retirees in selecting Medi care Advantage and Medicare Supplement plans. Though their management roles have expanded significantly as the agency has grown, both Anderson and Kent remain connected to the field as high-producing agents. The leaders are dedicated to

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