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Robert C. Dortch, Jr. | Sellers Hinshaw Ayers Dortch & Lyons PA | Charlotte

William Stroud


William Stroud is President of Lawyers Insurance and has managed the NC Bar Association Health Benefit Trust since its inception in 2002. Contact William at wstroud@lawyersmutualnc.com or 800-662-8843.

Do Wellness Programs Work?

A member recently joined the NCBA health plan who had a severe history of morbid obesity, diabetes and a number of other related medical problems.  Over the course of a year, this member shed well over 100 pounds, got his diabetes under control, and now exercises and takes care of his health religiously. 

This is a stark example of an individual’s wellness initiative paying huge dividends, not just in the risk they pose for expensive health costs, but more importantly in an exponentially improved quality of life.

What employers usually ask when considering whether to promote a wellness program is – will this provide a Return on Investment (ROI)?  In other words, how much will my health plan costs be impacted by a wellness program?

Well, if you extrapolate from an individual’s experience like the one above, you would think a wellness program could have a big impact.  Just get everyone to exercise, eat right, lose weight, quit smoking and, voila, lower health costs. 

Unfortunately, a recent study suggests wellness programs generally do not have a significant impact on health plan premiums.  From our experience with the NCBA health plan, it’s not hard to see why.  Much of today’s modern health expenditures are related to expensive acute or chronic care.  Large claims may arise from cancer, heart and renal disease or infections.  Specialty drugs, such as biologics commonly used for autoimmune disorders, are very expensive and chronic drivers of cost.  Wellness programs may do little to hold back claims of this nature and they are becoming huge drivers of higher costs.

The good news, though, is that while you may not be able to hold back the tide of swelling medical costs, you may get other unexpected positive results nonetheless.  The real payoff from a wellness program, or at least one implemented in a positive, team-building fashion, is happier, more productive employees.  Good health habits make us feel better, and it’s a lot better for employees to be comparing notes about their fitness progress than complaints about the tedium of the office.

So don’t implement a wellness program expecting to lower your health plan costs significantly.  But if you want a workforce with more enthusiasm, a better attitude and less absenteeism, a wellness program could be just the ticket.

William Stroud is President of Lawyers Insurance and has managed the NC Bar Association Health Benefit Trust since its inception in 2002. For a quote from the NC Bar Association plan, contact Delores Hunter at dhunter@lawyersmutualnc.com or call us at 800-662-8843.  If you have other questions about our plan you can contact me at wstroud@lawyersmutualnc.com.

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Affordable Care Act Update and the NC Bar Association Health Plan

With the opening of the federal health insurance exchanges, it may be a good time to compare your law firm health insurance rates with the NC Bar Association Health Benefit Trust.

We are in a rolling 12 month period when individuals and small businesses will be receiving their 2014 health insurance renewal premium notices.

The insurance rate reforms taking effect in 2014 will bring about widespread premium shock. Currently, costs can differ broadly based on age, gender and health conditions.  As a self-funded plan, the NC Bar Association Health Benefit Trust is not subject to the new rules governing rating and premiums and will continue with its current rating structure.

The NC Bar Association Health Benefit Trust has had an opportunity to compare 2014 rates in the individual and small business insurance market.  In most cases, traditional health insurance customers can expect to see rates 10-50% higher than those in the NC Bar Association Health Benefit Trust.  The Health Benefit Trust’s rate structure will remain unchanged, and our customers can expect to see normal rate increases along the lines of medical inflation.

The new rules have also caused changes to the plans available in the insurance market.  Generally speaking, there are fewer options with higher out-of-pocket expenses at a higher premium cost.  At the 2014 renewal, virtually every firm’s health insurance plan will change to some degree.  The plans of the Health Benefit Trust should remain relatively unchanged.

Another change that will affect some folks unfavorably is the way premium is calculated for the family unit.  The Health Benefit Trust will retain its tiered system with different premiums for Employee Only, Employee Spouse, Employee Child(ren) and Employee Family.  This structure does not charge premium on a per capita basis, and in fact, these tiers charge the same premium whether a family has one child or ten.  The new insurance system is on a per capita basis, so that larger families will be hit especially hard.

Please check to see when your firm’s 2014 health insurance renewal will occur, and make a note to compare rates with the NC Bar Association Health Benefit Trust.  With the magnitude of change that’s coming, it might be wise to get an early start this year.

For a quote from the NC Bar Association plan, contact Delores Hunter at dhunter@lawyersmutualnc.com or call us at 800-662-8843.  If you have other questions about our plan or the impact of health reform on your firm, you can contact me at wstroud@lawyersmutualnc.com.

William Stroud is President of Lawyers Insurance and has managed the NC Bar Association Health Benefit Trust since its inception in 2002.

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My #1 Financial Tip for the Solo or Small Firm

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Make Money online processBy way of background, early in my career I was self-employed (ate what I killed, as they say) for 8 years.  I was only moderately successful financially, and during this time I got married and had 2 of my 3 children.  I understand the vicissitudes of income to a small business.

Toward the end of my first year, I adopted what would turn out to be the most important financial discipline of my tenure as a small business owner.  I paid myself a salary.

Paying yourself a steady salary forces discipline throughout both your personal and business finances. 

On the business side, it requires that you accumulate operating capital and that you put together a budget of your business expenses so you will know how much you can pay yourself.

It also requires a personal budget so you know how much you need to pay yourself.

As you begin (or continue) to grow the income from your practice, budgets, capital and a steady salary will dramatically alleviate financial stress, making it much easier to focus on building your practice.  In a bad year, your operating capital may shrink, but you can continue to bring home a paycheck.  In a good year, after 12 months of steady paychecks, you can pay yourself a bonus.

On the other hand, even with a practice that produces substantial income, if you get on the merry-go-round of paying yourself as much as your practice produces, you have no saving and budgetary discipline, and you are constantly bumping up against a zero balance in both your business and personal finances, you will feel the full (and unnecessary) brunt of the financial stress of a struggling small business.

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