Webinar Recap: Healthcare Planning Strategies That Protect Your Clients, with Trust & Will

Caribou’s co-founder, Christine Simone, recently hosted a webinar with Andres Mazabel from Trust & Will all about how healthcare planning protects financial advisors’ clients. If you’re short on time or prefer reading over watching, our team has written an overview of some of the key points from the conversation below. However, if you want to hear the great questions that webinar attendees asked during the live session, we highly recommend watching the webinar below.

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Andres: Today we're going to talk about healthcare planning. I can tell you upfront that when I first met Christine, I was like, “Healthcare planning in financial advising? How does this actually tie in?” So this has been honestly a great learning opportunity for me, and if I was an advisor, this would be something I would definitely want to implement into my practice. So how did you and your co-founder come to say, we need to solve this?

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Christine: What we realized is that there's this big disconnect between the delivery of care and accessing care in the healthcare system, and then actually paying for it. And unfortunately, that burden is often placed on the consumer, or your clients, or the patient themselves. And it's no surprise that healthcare is the number one reason for bankruptcy. It's one of the biggest areas of overspending and it's currently people's top financial concern. So we interviewed a lot of people. We went out to ask a lot of questions, and it was consumers who told us, “I would love to go to my financial advisor with these questions,” or “I do already go to my financial advisor with these questions but they can only help so much.” So then we started doing the exact same thing with financial advisors to understand how they were approaching this topic, and how were they including it in their conversations related to financial goals for retirees. And we learned that there was a really big gap. We got to where we are today through a lot of conversations with financial advisors and we continue to see that there's still a really big need to bring this to more of the industry.

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Andres: Who is bringing healthcare into the conversation: clients or advisors? I can imagine this is information outside the scope of what most advisors are comfortable discussing.

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Christine: Advisors aren’t addressing it for the most part. It’s a brand new area of their planning and maybe they're a little unsure how to bring it into the conversation, understandably so. Again, they're not experts on healthcare. I often hear from financial advisors that their clients don’t bring it up, but conversely, clients are waiting on their advisor to bring it up. No one's really mentioning it. But what we do know, also in the data, is that clients are leaving their advisors because they don't discuss their full financial situation.. So advisors have an incentive to bring this up with their clients. Their clients want them to address the full scope of their financial picture and so it really needs to be them driving this. Otherwise, their clients aren't going to come to them with these questions, and they might find someone else who will address it. We're helping advisors identify the different life events that are applicable to bring healthcare up — the life events that impact your healthcare. We’re helping financial advisors identify these triggers because these are often missed opportunities to deliver value to clients.

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Later in the webinar, Christine showed a case study of a real-life client that worked with Caribou through their advisor. In the case study, a 68 year-old-business owner had an employer plan, but because they were the business owner, they were responsible for a hundred percent of that premium. But they had also - incorrectly - enrolled in Medicare Parts A and B, unbeknownst to their advisor who didn’t talk about Medicare with their client.

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Christine: When we started working with the firm and we started having these conversations with segments of their clients who were past 68 and still working, we identified this and were able to transition the client over to full Medicare coverage. In this case, it made a lot of sense. It was very straightforward because of how expensive the employer premium was, and so Medicare was the more cost-effective thing for them to do. But there are also a lot of other considerations to take into account. Is there a spouse in the picture? Does the spouse need coverage through this employer? Are there dependents who need coverage through this employer? Are there specific doctors that this individual wants to continue seeing for whatever reason? So it's highly personalized. This decision-making process isn't very cookie-cutter, and if you do it in a generalized approach, unfortunately, you miss opportunities like this. So this is more reactive, kind of to your earlier point of proactive versus reactive. That's $17,000 a year that the client missed out on for the course of two and a half to three years. We hope to work with advisors to avoid these situations altogether.

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‍Andres: In a case study like this, which is a great one to highlight, how is the advisor involved, and what type of support is offered in being able to talk about different options? Can you help me just quickly paint a picture of what that actually looks like to be able to get there?

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Christine: We don't expect financial advisors to look at different plan options across multiple geographies, taking into account different tax credits, or looking at prescription lists of their clients. So advisors use Caribou to be able to collect that data from their clients and then provide them with an output that is very financially focused but also aligns the options that are presented with the client’s preferences, health needs, risk tolerance, and budget. So there's this cycle that we go through where the financial advisor initiates the analysis, which again, is based on a life event. There's then the data-gathering component from the client themselves. We conduct the analysis and we send it back with those planning insights. This is one example where an individual had established coverage from the Marketplace, they have a pretty high premium and a big, what we call, maximum exposure, meaning the total of their possible out-of-pocket healthcare costs plus premiums. So there's the planning perspective where we're planning for some of these transitions, like retirement, like Medicare eligibility, years in advance But once you actually establish this coverage, you have to look periodically at if there are different opportunities to optimize it. The answer is often yes. So in this case, there was a tax credit that was applied, and we were able to reduce the premium as well as the risk exposure.

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Andres: What would you say is the main feedback and/or impact that you're hearing from advisors that are proactively bringing this into the planning conversation?

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Christine: That all goes back to the point that clients are worrying about healthcare. We've heard clients say, “I wish I had done this sooner,” or “I'm so grateful that this is a service offered by my advisor.” So clients really are appreciative of this. I've had a financial advisor even tell me once that after we had an interaction with them and their client, they said, “That client is never leaving me after that experience that we just had with you.” So it is so, so appreciated from the client side. And advisors want to do exactly what their clients are asking for, right? Of course. So we hope that advisors are going to start picking this up more and more.

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