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Financial advisors: Four things to consider when evaluating a healthcare extension



How to use healthcare as a differentiator

As the Department of Labor Fiduciary Rule looms over the financial advisor industry, most advisors are having to take on a legal fiduciary duty on behalf of their clients. As their roles shift and, simultaneously, healthcare becomes more and more material to the financial health of their clients, many advisors are including healthcare as a part of their financial planning process. Our team at Bernard Health has talked to hundreds of financial advisors about healthcare in 2017. When it comes to helping clients, the whole industry is evaluating three options:

1. Build health insurance and Medicare expertise in house by hiring an expert or helping a current staff member get a health insurance license

2. Add a “healthcare extension” to their practice by partnering with an outside resource like Bernard Health.

3. Do nothing. While many advisors are addressing healthcare questions head-on, some are concluding that it's not within their scope as a fiduciary to provide healthcare expertise to clients.

For the advisors considering a “healthcare extension”, how can they be sure their fiduciary duty is taken seriously by their partner? In other words, will the outside resource have their clients’ best interest in mind when giving healthcare advice?

When evaluating a partnership with a healthcare expert, here are four considerations that help ensure your clients are getting the kind of healthcare advice they need.

Four things to consider

  1. How is the healthcare resource paid? Some healthcare experts charge the advisor directly. Others don't charge the advisor, but receive commissions when signing clients up.

  2. Are they noncommissioned, or is their business built around selling products? Usually, when a financial advisor pays for a healthcare extension on behalf of their clients, the healthcare expert is noncommissioned. Other healthcare experts build their business around charging individuals directly or by signing people up for health insurance.

  3. Do they work with all carriers? Some healthcare advisors are affiliated with certain products. Others remain carrier agnostic, and evaluate all available options.

  4. Do they only help clients when they need to purchase an insurance product? Or do they evaluate retirement plans and other employer options too? Healthcare advisors that rely on commissions may only be incentivized to help clients sign up for new insurance products. Healthcare advisors paid directly by a financial planner may be more inclined to evaluate other options, like employer-based coverage, or to help with other areas of healthcare planning, like auditing medical bills or enrolling in Social Security.

    Adding a healthcare extension may be the best fit for your firm. If you'd like to consider it, Bernard Health may be able to help you answer these questions and find the best resource for you and your clients.

    Here is some feedback from clients of financial advisors that Bernard Health recently helped.

    “The Bernard advisor was professional, yet personal. I felt her interest in helping me have the best plan available. An extra tabulation of my results was needed to perfect the plan, and she did it in a timely fashion, with great skill and expertise.”

    “The Bernard advisor was a pleasure to work with; could not have had a better experience. It is comforting to know that I am using the “best” of the alternatives for Part B and Part D, and knowing that if I have ANY insurance questions/issues in the future, I have an objective resource at my disposal.”

    “With so many options, the search was very time consuming and confusing. We were gratefully relieved to have the Bernard advisor do the research and clarification for our best choices. And we will save money.”

    “This service is a life-saver. We have also called our advisor to let her know that we are satisfied and how helpful it was. We’re so thankful it’s offered.”

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