David Contorno, Founder & CEO at E Powered Benefits, is a trailblazing figure in the insurance industry. He was one of the first to raise his voice against traditional insurance carriers and the negative impact they have on employers, clinicians, and patients. Having a wealth of experience in agency ownership, David previously ran successful consulting firms. However, he decided to take a different approach and established a fully transparent, anti-BUCAH (Benefits, Underwriting, Claims, Administration, and Healthcare) brokerage. The main focus of his brokerage is to create health plans that empower employers to control costs and prioritize high-quality, affordable care for all the covered patients.
David’s accomplishments in transforming the US healthcare system have not gone unnoticed. He has been honored with prestigious awards, including Forbes Most Innovative Insurance Broker, Benefits Pro Broker of the Year, and Validation Institutes Advisor of the Year. His work has been featured in several New York Times Best Selling books, and he is a sought-after speaker, educating audiences nationwide on delivering high-performance health plans to employers.
Stepping in Insurance Sector
David’s journey in the insurance industry began early, as he started telemarketing life insurance at the age of 12. By the time he turned 17, he was already selling traditional health plans to small employers in the NYC area. With dedication and hard work, he successfully grew an agency, employing over 15 people and generating around $1.2 million in revenue. In 2007, David made the decision to relocate to North Carolina and venture into a new agency.
Over the years, his new agency flourished, and by 2013, it was generating double the revenue compared to his previous agency. However, despite the success, one thing remained constant – his clients’ reluctance to meet for their annual renewal meetings. Most of the time, these meetings brought bad news for the clients. But what truly became challenging for David was having to convey to his clients’ employees that their out-of-pocket expenses would increase, benefits would decrease, and more money would be deducted from their paychecks. This was a difficult message to deliver.
David noticed that some traditional brokers attempted to alleviate the situation by offering additional insurance products like Aflac, claiming that it would reduce certain out-of-pocket expenses. However, this approach didn’t sit well with him. He questioned why the insurance industry believed that more insurance was the solution to the problem his clients faced. He saw it differently, recognizing that his clients had an insurance problem, and simply selling more insurance didn’t seem like the right answer.
He understood that many brokers earned commissions, and as premiums rose and more insurance policies were sold, they made more money. It became apparent to him that these brokers were insurance salespeople, and even though they may appear to work for the clients, the reality was that they were being paid by the insurance carriers. This experience gave David a unique perspective, as he knew firsthand the dynamics of the industry and the potential conflicts of interest.
Challenging the Status Quo
In his professional life, David adopts a contrarian or challenger sale approach. When discussing complex topics like healthcare and health insurance, convincing people to move away from traditional health plans can be quite challenging. At least that’s how it seems. When David first started exploring alternative paths to building health plans, he focused on his solutions. However, he soon realized that these solutions didn’t resonate effectively. It took him a few years to understand the reason behind this – solutions to a problem lack appeal when one doesn’t fully comprehend the problem itself.
During his initial meetings with employers, David typically highlights how the US Healthcare system’s quality declines while costs increase over time. He emphasizes that succeeding in such a rigged system is an uphill battle.
On a personal note, David’s approach contrasts with his professional demeanor. He dislikes confrontation and animosity, preferring a romantic and family-oriented lifestyle. He enjoys experiencing events like travel, Broadway shows, concerts, or relaxing by the pool with his family.
Passion for Bringing Change
David is passionate about fixing a system that he believes isn’t broken, despite what many people think. He often emphasizes that the system is actually functioning exactly as it was designed to, except it wasn’t designed by patients, employers, or doctors. Consequently, it’s not working well for these three groups, but it’s highly profitable for most other entities involved.
He strongly values the idea that when someone requires medical care, they should receive the highest quality of care possible, and it should be affordable regardless of whether they have insurance or not. However, there are two critical areas where the system has been slow to progress for decades: providing cost and quality information.
David finds it hard to accept the excuse that it’s too difficult to publish pricing and quality information. He draws a comparison to Amazon, which manages to display pricing and quality details for a vast array of products, even with pricing changes happening every 10 minutes. He’s witnessed hospital and carrier executives claim that revealing this information would lead to unfair competition and higher prices, which he finds quite audacious. He questions where transparency in any other sector of the economy has led to such negative outcomes, asserting that, in reality, transparency tends to have the opposite effect.
Offering Assurity
E Powered Benefits specializes in building innovative health plans, and their primary focus is teaching others in the industry how to create similar plans. These health plans achieve remarkable results that may seem unattainable to most employers. In the first year alone, these plans can reduce the total cost by 35%, with ongoing double-digit decreases in subsequent years.
One of the key features of their plans is that employees have the freedom to choose any healthcare provider they prefer. However, if they opt for providers recommended by E Powered Benefits, who have direct contracts with high-quality, transparent providers, the employees’ out-of-pocket expenses are waived, and they pay nothing. Instead, the plan covers 100% of a smaller cost. In contrast, if employees choose to go to other providers, they will have reasonable out-of-pocket expenses to bear.
E Powered Benefits extends this cost-saving approach to medications as well. By eliminating intermediaries and sourcing medications directly from manufacturers, they can significantly reduce the cost of drugs. In some cases, this can result in a cost reduction of 70% to 100%, even making expensive drugs available for free. This substantial cost reduction provides much-needed financial relief to hardworking families grappling with health conditions, enabling them to afford better disease management while retaining their health coverage.
Despite popular belief, E Powered Benefits advocates that most Americans could be better off without paying premiums and instead paying for medical services directly. They highlight that health insurance does not inherently make healthcare more affordable. In fact, presenting a health insurance card often obligates the plan and the member to pay the highest prices in the US healthcare system.
Team and Organization
In E Powered Benefits’ approach, both in plan administration and from the employer’s perspective, teamwork takes precedence over individual heroics. David frequently emphasizes that in a group health plan, which includes all employer plans, any unnecessary payouts made on behalf of one individual or their family don’t just impact them alone. Instead, it affects every other member covered under the plan.
Showing Path for Inspiring Leadership
David’s advice to someone stepping into a leadership position for the first time is to be brave. He suggests that “if you strongly believe in something, truly understand it, and recognize how it can benefit others, find a way to turn your passion into a profession. Align your work with your values and the people you aim to serve. It’s essential to monetize your endeavors in a manner that supports the interests of those you claim to help. If your approach contradicts the well-being of those you serve, it will not lead to success on a larger scale. So, strive to combine your passion, understanding, and financial goals in a way that benefits both you and those you lead.”
Written by Steve Sanchez.
