Hard numbers are difficult to come by, but company by company, brokers handle anywhere from 80 to 95 percent of small and medium-sized businesses' coverage choices. WellPoint Health Networks estimates that brokers handle 95 percent of all its sales to small businesses, which it defines as fewer than 50 employees. Kaiser Permanente's West Coast operation felt the influence of the brokerage community when it ran into a membership slump. Kaiser decided to bring in brokers and start paying commissions for the first time to attract companies with fewer than 1,000 employees. The company now actively works to keep its plans at the top of the list of some 10,000 brokers in California.
Brokers know just how important they are to the health plans.
While Elenz flatly refuses to accept freebies handed out by health plans, offers of trips to exotic destinations are not uncommon. As a partner in Arthur Andersen, though, Blackard buys his own steaks. Regardless of the meat on the table, the big game for brokers is always in the commissions. Sometimes the attraction of big money draws a wide array of characters into the brokerage ranks. Those brokers, he says, are more concerned with which plan pays the highest premium rather than which offers the best service.