Selling Disability Benefits to the Physician Market

Physician groups are among the best-kept secrets in the employee benefits market. There are hundreds of thousands of small medical groups (fewer than 50 employees), representing a market with tremendous growth and sales potential.

There are many benefits to selling to physician groups. For one, a long term disability (LTD) plan for physicians can net premiums that are, on average, five times higher than comparably-sized non-physician groups. This is due to their higher-than-average incomes and high risk rates.

In addition, the physician market has a historically higher persistency than other markets. The very reasons why it's so difficult to sell to doctors -- they're hard to get in touch with, hard to convince of the value of long-term disability coverage, etc. -- can also help limit the amount of competition you'll encounter from other agents. Because physicians are so busy and because group benefits are not their daily priority, they are less likely to shop around for new benefit providers year after year. They have neither the time nor the reason to research new consultants or providers. Why would they, if you've sold them the best employee benefits products available?

Selling to physicians groups can create a lucrative and loyal client base for you, but you must first know how to prepare for the sale and what they need from you. Following are several tips for cracking into this market.

Preparing for the sale
Before diving into the physician market, remember one thing: These are not your typical benefits prospects. Physicians are far different from benefits administrators and other human resources professionals, who are tasked with providing quality employee benefits while keeping an eye on the company's bottom line. HR professionals are familiar with different types of coverage and how to administer benefits. They have the time and resources needed to make a decision about benefits, and they are comfortable working with agents.

This isn't always the case with doctors. Doctors may not have the time and expertise needed to engage in a complete discussion about employee benefits. This means that to successfully sell to the physician market, you should:

  • Be prepared to be persistent. Employee benefits are not the most important part of a doctor's day. In small physician groups with fewer than 50 employees, the doctors are burdened by a full patient load and the demands of running a small business. Small-group doctors make their own business decisions, but getting in front of them to present your case may be difficult. Many physician groups employ a practice administrator who is responsible for facilitating decision-making, managing the personnel and business affairs of the physician practice. The administrator is the gatekeeper, and while they may not make the final decision, he does decide whether what you have to say is worth the doctors' time. Be prepared to sell yourself to the practice administrator before you can get time with the practice's doctors.
  • Be prepared to demonstrate the value of being covered as a group. If and when you're able to get into the office, you will be selling to the doctors themselves -- doctors who may not have experience with a group benefits plan. Why? Because early in their careers, most doctors are encouraged to purchase as much individual disability coverage as they can. The misconception is that group benefits are for the average employee and can't meet the needs of doctors and their incomes. Likely, they don't understand how a group benefit such as LTD can supplement or replace their individual disability coverage. The first step is to show doctors how employee benefits will meet their needs. The second step is to explain that the added value comes from electing benefits as a group. However, you must sell the physician on how employee benefits meet their individual needs -- not how coverage meets the needs of the entire office.
  • Be prepared to overcome negative misconceptions about insurance providers. This is an important differentiator from your traditional prospects. Doctors deal with insurance carriers every day and probably have preconceived notions about the quality of certain carriers. It's common for a physician to have a horror story about poor customer service or battling over claim payment with an insurance carrier. Be prepared to counter any negative opinions of carriers by emphasizing your carriers' claims-paying reliability and outstanding customer service.
  • Be prepared for a lengthy decision-making process. When you do finally receive a call or book a meeting, you may need to return more than once to have the same conversation. If there are multiple doctors in an office, they may all have a say in the decision but may not be able to meet with you at the same time. Often, monthly partnership meetings allow you the opportunity to make your pitch to all the partner physicians at one time.

Physician groups: Making the sale
Once you've gotten your opportunity to sit down with the doctors, there are a few things that you must consider in your presentation and product offerings:

  • Physicians have specialized professions and need specialized contracts. Physicians' benefits needs differ from other occupations, especially when it comes to disability coverage. The variety, complexity, and specialized nature of the medical profession require equally specialized contract provisions and claims administration. To be successful, you must provide contract provisions that meet the unique needs of physicians. For example, the definition of disability is the key to a claimant's ability to receive an LTD benefit, so you will need to provide physicians with a "specialty/sub-specialty" definition of disability -- an LTD plan that considers the specific duties performed by a physician instead of a "generic" list of duties performed by a typical specialist. Without a specialty/sub-specialty definition, and without consideration of a physician's specific procedures performed at his practice, many doctors will be unpleasantly surprised at claim time. Carriers familiar with providing coverage to physicians will also have a dedicated claims area that only services physician claims.
  • Physicians don't value return-to-work programs as much as other professions. In fact, the quickest way to end a conversation with a group of doctors is to say "return to work." Physicians do not want to be forced to perform another job. Expertise in one specialty doesn't necessarily translate into other medical areas, and physicians are commonly unwilling to perform any job other than their specialty. When you consider the variance in training, licensing, expertise, and pay from one specialty to another, it's easy to understand why.
  • Physicians earn higher incomes, so they want higher benefits. Traditionally, physicians are more interested in hearing about "income protection" than "long term disability." The individual disability coverage that those doctors previously purchased probably provides them with 60 percent of their monthly earnings at that time. Most physicians are limited to $10,000 to $15,000 of monthly individual disability coverage. Group LTD provides you with the opportunity to provide physicians with an additional $10,000 to $15,000 of monthly income protection. Position your employee benefits as another layer of protection for the income they've worked so hard to achieve.
  • Physicians are looking for the best coverage, not the lowest rate. Often, agents sell employee benefits by listing 10 to 15 carrier proposals on a spreadsheet and listing the rates from lowest to highest (so the lowest rates are the first the prospect sees). The assumption is that most of the benefits plans are pretty much the same, and the lowest bid wins. This is not effective with physicians. When selling to doctors, emphasize the quality of the carrier and dependability at claim time. Explain that low rates almost always mean fewer and more restrictive benefits, less-precise definitions, and hidden loopholes in contracts that may present claim problems for a highly paid physician specialist. You'll find that they're less concerned with the price and more concerned with the value of the benefits. Selling to the physician market requires a different approach, but the rewards are worth it. All these hurdles begin to work in your favor the second you've captured a doctor group.

While a sale to physician groups may require more patience, persistency, and effort than the average sale, the rewards are great. But first, take the time to understand this niche marketplace; it's time well spent.

Drew J. Niziak is vice president of distribution for the employee benefits division of Sun Life Financial's U.S. Operations in Wellesley Hills, MA.

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