Benefits Administration Business Plan


Benefits Administration Business Plan


The Employee Benefits Administrators (EBA), will offer benefits outsourcing for small and medium-sized businesses. The Morgantown office was opened.

Employers are increasingly looking for ways to outsource functions within their businesses that aren’t directly related to the income generation. Human Resources Administration must be considered as a first option, since it doesn’t directly link to generating income.

Outsourcing is an innovative approach that can increase productivity while also reducing costs. Employee Benefits Managers aim to deliver high quality benefits administration services and customer service to clients, allowing them to focus on other strategic initiatives.

EBA’s initial target clientele will be clients with ten- to five hundred employees. Customers will have the option to choose from four levels, each tailored to their specific needs.

  • COBRA (Consolidated OmniBus Reconciliation Act), and HIPAA Administration
  • Administration of flexible spending accounts
  • Basic Benefits Administration – Includes a call center and for health and welfare programs
  • A level that combines the three previous levels.

EBA will market its services through business associates, insurance brokers, local businesses, and professional associations. EBA has plans to become a ‘#8220’WBE&#8221’, Women’s Business Enterprise in Pennsylvania in order for it to do business on the Federal and State levels.

Employee Benefits Managers is now an LLC (Limited Liability Company). Cindy Wells is the sole owner (principal) of the business. They have over 25 years of combined experience in corporate benefits administration, employee relations and communications, legal compliance, and a history of providing outstanding customer service. They are able to work with both employees and management at all levels.

This business plan is used to forecast financial statements for three-years and to get initial funding. This will cover all operating costs and start-up costs. Employee Benefits Administrators projects substantial revenue by the end of year one, and phenomenal by the end of year two.

1.1 Objectives

EBA hopes for the next three decades to be:

  • Significant first-year revenue, with remarkable growth in the second year
  • One new client/month (for COBRA) and one new customer/quarter (basic and all inclusive services).
  • At the beginning year 2, staff consisted of three people. By the end of year 3, staff comprise seven people.
  • By the end of Year 3, to evolve from providing strictly benefits administration to offering payroll services and/or any other HR services in which clients have expressed an interest in outsourcing

1.2 Mission

Employee Benefits Managers provides high quality benefits administration services and customer service to small and medium sized businesses. This allows them more time to focus on their strategic initiatives.

1.3 Keys to Success

EBA’s keys to success include:

  • Excellent communication and customer service skills — completely confidential, reliable, and trustworthy expertise and information
  • One of our most popular Human Resources Information software modules
  • Thorough knowledge of benefits administration issues


Health Plan Administration Business Plan


Health Plan Administration Business Plan


Southeast Health Plans, Inc. is a service company that will provide health plan administrative services to self-insured employers. The company will target employers with 50 to 500 employees. Many of these employers have current HMO, PPO, or major national insurance carrier health plans. While the majority of employers with 500 or more employees have at least some element of self-insurance incorporated into their health care programs, our target market is often ignored by the major national insurance companies. The majority of 500-plus employee-based companies are self-insured. However, Southeast Health Plans’ management discovered that less than 25% have plans.

Companies who are currently self insured and those with other types of insurance will have to transition to self-insurance. The availability of high-quality administrative and consultative services is an important factor in the transition from self-insurance to self. Southeast Health Plans, Inc., is managed by an experienced team. It has formed a strategic alliance and a subsidiary of Blue Cross/Blue Shield Pennsylvania, Blair Mill Administrator, to provide the best benefits management services to its target audience.

Southeast Health Plans, Inc. is expected to generate more than $5,000,000 in revenue over five years, with a net profit of $1.6 Million after taxes. After-tax earnings of $560 million will make the company profitable by year three. Margins as a marketing company and service provider will be high. Gross margins exceed 80% (less sales incentives costs) and close to 50% after operating expenses. Once market penetration has reached maturity, the company will turn profitable.

Southeast Plans, Inc.’s success lies in its ability to attract capital to market its services in the metropolitan Atlanta area and northern Georgia. Proper professional sales personnel is critical. The company will then need to expand its success in the Southeastern markets. The company must control costs, especially with respect to marketing programs and sales, in order to expand within the Southeastern markets. This will be possible by utilizing internal cash flow to fully fund expansion.

1.1 Objectives

The company has the following objectives:

  1. Co-operative marketing using Blair Mill advertising executions in the Atlanta metropolitan market
  2. To hire sales staff, both identified and unidentified, to implement a sales follow-up strategy.
  3. At least 4,800 employees total under management by year end.
  4. To reach break-even at the end of the second year by reducing the total loss to $100 000 in the second year and increasing market share.
  5. To shift to earnings by year three, and to accelerate gross margin contributions by building market maturity over infrastructure.
  6. To expand regionally using both sales and media personnel to penetrate new market segments while consolidating our service capabilities.
  7. To continue to achieve cost benefits through an expanding provider network, while maintaining quality patient care.
  8. To have more that 98,000 employees under management by year five.

1.2 Mission

Southeast Health Plans, Inc. provides small and medium-sized employers with a comprehensive benefits management program that allows them to manage their health benefits while giving employees access to high quality healthcare. Southeast will offer its clients, employees and employers, the best health care possible by combining self-insurance and stop-loss programs with efficient plan administration. Southeast will deliver a balance of quality care and freedom of choice at a fair price.

1.3 Keys to Success

These are your keys to success in the business.

  1. Marketing. Southeast Health Plans has the ability to sell directly through employers and independent insurance brokers and agents. Name recognition will be important among established programs. It is important to control media budgets and maintain closing ratios of 5% per annum for leads.
  2. High quality service. Services provided by Blair Mill administrators are among the best in small-employer services. Customers will be satisfied due to the value-added experience of the Southeast Health Plans, Inc. Management Team and their provider network.

It is important that clients feel satisfied with their service and plan cost in order to reduce client erosion as well as to fight competition. Renewals should be at least 85% of existing clients.

  • Controlled growth. Growth must include aggressive expansion to new markets, while also focusing on profitability. Each market that has been established must mature to ensure internal funding. Cash flow management must be done. Both market expansion as well media effectiveness must constantly be evaluated, and then re-evaluated or modified as needed.