How a Non-Profit Saved $1.4M on Premiums

Switching to an ICHRA with SureCo allowed RFK Community Alliance to contain health coverage costs while increasing employee satisfaction.

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RFK Community Alliance is a non-profit human services agency based in Lancaster, Massachusetts. With 400+ employees, the organization offers day and residential programming for youth and adults with developmental, learning, behavioral and other challenges, as well as mental health and other services for children and families.

A Look at the Numbers

29%

saved on premiums

RFK was looking at a third consecutive year of a more than 20% renewal rate increase. By switching to an ICHRA with SureCo, they saved more than $1.4M annually, including all platform and consultant fees.

428

eligible employees

SureCo onboarded 245 employees onto its Enrollment Platform, and over 93% saw a savings on their healthcare premiums, with many choosing identical plans to the ones they had pre-ICHRA.

24

Medicare-eligible workers

RFK needed a solution that could accommodate the wide range of ages in its workforce. An ICHRA gave them the flexibility to do so and even allowed those who were 65+ to benefit.

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The Challenge

Stop recurring high-cost claims while offering a choice of quality carriers to employees

RFK Community Alliance is the result of a merger between the Doctor Franklin Perkins School and RFK Children’s Action Corps. When the non-profits merged in 2020, so did their health insurance claims. “Each separate business at the time was getting about a 20% increase and then we took it over and merged the two into one plan,” says Tony Macsata, senior benefits consultant at Brown & Brown. But merging the plans didn’t help offset the rising costs of the organization’s premiums. “RFK has one high claim that's about $900,000 a year and then it has a couple cancer claims that have hit $300,000 to $500,000. Combined, they were looking at a 140% loss ratio going on three years now with no end in sight.”

While in 2022, Macsata was able to bring a 27.5% renewal increase down to 14.5% through plan design changes, in 2023 RFK was again faced with a 21.5% increase. “We never want to pass one penny of rising healthcare costs onto our employees, and for many years we were able to avoid it, but this year I think we would’ve had to,” says Derek Padon, RFK’s SVP of Human Resources.

Additionally, Padon says he wanted to increase plan options for employees. Many workers wanted to keep either the Blue Cross Blue Shield or Harvard Pilgrim plans they had pre-merger, which didn’t work under the traditional group model.

“Employee satisfaction is key,” adds Padon. “We’re in a high-turnover industry, and the more negative things that happen to our organization, the worse our turnover gets, and that’s bad for everyone—the residents, the remaining staff, and our bottom line.”

The Solution

Eliminate claims risk and maximize plan options by migrating to an ICHRA

Switching to an Individual Coverage Health Reimbursement Arrangement (ICHRA) with SureCo promised substantial savings for RFK by transferring the risk of its high utilizers to the much larger individual market. It also allowed employees to select the plans they loved and were used to, meaning they could re-enroll in the BCBS or Harvard Pilgrim plans they had previously.

The math around premiums worked out favorably, but Padon had some implementation concerns he needed addressed before he gave the green light. He wanted to ensure that RFK would be able to continue to work with Brown & Brown as their broker, and he knew his employees were going to need education and support around the new model. “We needed a true HR partner to make this work,” he says.

With a fully managed onboarding and open enrollment, SureCo gave RFK just that.

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“SureCo takes something that is very complex and makes it as simple as it possibly can be.”

Tony Macsata

Senior Benefits Consultant, Brown & Brown

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The Results

29%, or more than $1.4M, saved on yearly healthcare premiums

In addition to driving down costs for the company, implementing an ICHRA with SureCo also helped RFK’s employees. “We were able to decrease the costs for almost every employee, and in many cases that included bringing them back to the exact plans they had previously,” says Padon. “One employee even called our office to ask if this was for real because they couldn’t imagine saving that much!”

As a consultant-first company, SureCo partnered with Brown & Brown every step of the way. “SureCo takes something that is very complex and makes it as simple as it possibly can be,” says Macsata.

The SureCo migration team onboarded 245 RFK employees onto its Enrollment Platform and held open enrollment education sessions for everyone. SureCo even conducted a special session for the company’s 24 Medicare-eligible workers. (Medicare is considered an individual plan under ICHRA and is eligible for tax-free employer contributions.)

“Every company tells me they’ll be an extension of our HR team,” says Padon, “but SureCo really is. They worked one-on-one with our high utilizers to ensure their needs and continuity of care were being met. We worked with the same support and migration specialist throughout the entire process. She really got to know our team and quickly addressed concerns as soon as they came up. And we love that there’s a phone number our employees can call 24/7 to get their questions answered. It takes so much off our plate.”

At its core, RFK is a company that cares for people, and that starts with its employees. “Moving to an ICHRA with SureCo has been terrific for everyone involved,” says Michael W. Ames, president and CEO of RFK. “It eliminated the significant cost increases we would have faced, increased plan options, and ensured continued quality healthcare coverage.”

 

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