We recently took over as the new broker of record for a client with a couple hundred employees and I can’t help but share the experience. They had a renewal proposal in hand from a couple of household carriers in CA (an HMO and a PPO) and they had been working with a national agency –also a household name. When we requested copies of the renewal proposals from the carriers ourselves, the pricing was LOWER than what they had been presented. When we requested clarification from the carriers, we were unable to get a reasonable explanation.
There is none. Unlike just about all other industries, healthcare does not result in volume discounting at least in terms of broker compensation. When a large agency negotiates a profit-sharing contract with your insurer (which can come in various forms), it is simply added onto the premium that the employer is charged. Imagine what would happen if all the players in the healthcare supply chain operated with transparency.