Rising star drives industry change through entrepreneurship
Aspira of Pennsylvania, which manages six charter schools in the Philadelphia area and has 750 employees, faced debt issues that left it struggling to make insurance payments back in 2015. The organization ended up being dropped by its insurance carrier and needed help reorganizing its benefits strategy. That’s when benefits adviser Zain Hasan stepped in.
Hasan, now 32, hadn’t been on his own in the benefits game for very long. He had left a position as an adviser with a prominent insurance carrier and launched his firm — the National Insurance Consulting Group — in 2014. Hasan was able to negotiate a deal that would save Aspira over $1 million, by moving the company into matching plans on a self-funded basis.
It was a major success for a young adviser looking to upset the status quo of the typical broker-client relationship. He would make a career of this, launching two businesses with the goal of helping employers and their employees find the best care and benefits solutions on the market, while staying true to his community-based values.
“The standard broker relationship is the guy who comes by once a year and tells you what your renewal rates will be and says, ‘Sorry, there’s not much you can do about it,’” says Irv Williamson, a financial consultant who served as Aspira’s interim CFO from 2016 to 2018. Hasan “had a longer term strategy to create a self-insured plan with the same level of coverage that the employees had before.”
Hasan, one of Employee Benefit Adviser’s 20 Rising Stars in Advising of 2020, spent 13 months helping Aspira actively manage its self-funded plan and working with its finance team to determine an installment program and getting the insurance provider to agree to it.
“Our premiums were extremely high prior to Zain and his company coming on board,” says Marisol Morales, human resources director at Aspira. “They brought that number down. He has allowed us to save money on the insurance plan as well as keeping our employees satisfied, with less disruption.”
Aspira left one of the top five brokerages in the United States to formally become Hasan’s client in 2016. Since then he has taken Aspira from fully insured to self-funded and then to a reference-based pricing model and a transparent pharmacy benefit manager, or PBM.
“Their previous broker was not bringing a sense of urgency” to the situation, Hasan says. Understanding the organization’s desire to take care of its teachers, Hasan got to work securing a third party administrator, setting up the PBM, stemming the losses while maintaining the existing benefit design.
I was 27, I was working out of my basement, and I was trying to figure out how to educate employers on healthcare.
The future of the industry
Hasan says he is seeing a lot of positive changes in the benefits adviser space, including the realization that more advisers view it as a mission-driven industry. He consistently hears that millennials don’t want to work in insurance, which concerns him since younger generations must fill the role as more baby boomers retire.
“This is healthcare consulting; it’s the ability to save lives,” says Hasan, noting the importance of partnerships and collaboration with organizations and nonprofits such as Health Rosetta, where he was certified as a benefits adviser in 2018. “We’re not doing insurance brokerage work anymore. It’s inspiring to know that there are [other] firms out there that are doing what we’re doing.”
Changing this view of the benefits advisory career is another factor that helped drive Hasan to found two businesses. Hasan’s second business, National HR Consulting Group, was founded in 2015, and remains independent from NICG. His goal was to help HR leaders focus on the critical aspects of their roles and not get tied up in complex HR tech issues.
“The world of human capital management software is constantly changing, and the number of vendors available is constantly growing,” Hasan says. “Organizations fight the war on attracting and retaining top talent, while HCM vendors rapidly innovate to meet the need. Our clients were changing vendors and experiencing real pain as they were learning how to use what they purchased.”
Hasan and his partner saw that the tech vendors were unable to retain their systems implementation specialists, and organizations were spending too much training on the new system. The result was a waste of money.
While Hasan and some partners were able to build two successful businesses, his road to becoming an entrepreneur in the benefits advisory space was paved with frustration, primarily involving what he saw as a broken system that was focused more on compensation than quality of care.
Before forming a firm, while he was at Cigna, Hasan was mostly frustrated about the incentive compensation model of the broker world, he says. He saw some brokers artificially negotiate renewals that were fully insured, without taking the time to consider how they could add value to the client by helping them be self-funded, he says.
That motivated Hasan to set out on his own to create a firm with the goal of eliminating that conflict of interest. He would adopt a flat fee model and offer economic and practical healthcare solutions to employers and employees without skimping on the quality of care.
“The goal was to create a firm that really aligned with the clients’ interests,” Hasan says. “I wanted to make sure every employer was educated on the conflicts of interest that exist within every facet of the healthcare ecosystem, but primarily that the traditional broker model isn’t in their best interest.”
For Hasan, it didn’t make sense for an employer client to put trust in an individual who was being paid by a third party and who wasn’t obligated to be transparent. He says he recognized that as costs went up, so did broker compensation.
“I wanted to bring employers the option of a performanced-based business,” Hasan says.
So, Hasan founded the National Insurance Consulting Group. The firm offers benefits consulting, outsourced benefits administration, human capital management software delivery, and outsourced HR. It would be a difficult start; more than 12 months would pass before he landed his first client.
“My first 82 prospect meetings were rejections,” he says. “I was 27, I was working out of my basement, and I was trying to figure out how to add value and trying to educate employers on healthcare.”
The biggest challenge at the start was getting an organization to essentially break up with the broker it had been working with for years, Hasan says. Companies with longstanding broker relationships weren’t receptive to learning new things or taking on new strategies. Hasan had to adapt and learn how to emphasize that the change would be a true investment in their employees, which would in turn have positive results for the organization.
Eventually, the business would grow to a book of $2.2 million and about 35 clients by the time the organization was acquired by Risk Strategies, a national insurance brokerage and risk management firm, in 2019.
“We met Zain and his partner Josh Conklin and were impressed by their energy, innovative approach to benefits design, and willingness to operate outside the conventional employee benefits paradigm,” says John Greenbaum, national employee benefits practice leader at Risk Strategies.
That energy and innovative drive has left a lasting impression on more than Greenbaum and Risk Strategies.
Zain Hasan has allowed us to save money on the insurance plan as well as keeping our employees satisfied with less disruption.
Albert Velez, regional vice president of new business acquisition at NICG, was in a transition period in his life when he was introduced to Hasan through a mutual friend. Velez, 42, was looking for a new career opportunity, and he says Hasan offered him much more. He became a mentor and friend, even paying for Velez to earn his property and casualty license.
“He helped me get to where I am now,” Velez says. “He said ‘I’m going to put my money in you,’ and nobody had ever taken the time to see the potential in me before.”
Velez and Hasan worked together closely to help The Lighthouse, a Philadelphia-based nonprofit early learning provider, which officially became a client in September 2019. The Lighthouse was struggling to provide good health insurance for its employees, Velez says, and needed an alternative for its pension fund. The organization also needed to update its HR procedures, which was still a paper operation.
“Hasan catered to the needs of our organization,” says Miguel Concepcion, president of the board of trustees and acting CEO. “We’re taking an agency that’s been around since 1893 into the 21st century.”
After spending three hours listening to the organization’s concerns, Hasan was able to come up with a solution that their previous broker hadn’t. The duo would implement a 403(b) retirement plan, which the organization hadn’t been familiar with. They also introduced the organization to their human resources business process outsourcing system and are currently working to provide an alternative to its health plan.
Concepcion was moved by the way Hasan was concerned about the organization’s staff and the community of people they help. While The Lighthouse was going through executive and organizational changes, he offered his expertise and advice at no charge.
Velez was also impressed by how personally connected Hasan became, even before the organization signed on as a client.
“[Hasan] understands insurance like nobody else,” Velez says. “He understands the issues clients have, and he’s able to connect with clients in a way that I haven’t seen before.”