Private Equity Benefits Optimization

Healthcare spend is an EBITDA line long before it is an HR topic.

Sponsors evaluate every operating expense with discipline. Employee benefits is often the largest expense reviewed the least, because the analysis lives with a broker rather than with the deal team.

Learn whether a Benefits Optimization Report makes sense for your organization. No cost. No obligation.

The Approach

How Benefits Optimization applies here.

Brian Pinto is an employee benefits consultant who works with private equity sponsors, operating partners and portfolio company CFOs to evaluate healthcare cost, funding structure and plan performance using the same data standards applied to any other cost center.

In a portfolio, benefits decisions compound. A platform company and three add-ons frequently carry three carriers, three pharmacy arrangements, three eligibility rule sets and three renewal calendars. Each one carries its own cost curve, and none of them were designed together.

Benefits Optimization is an assessment methodology, not an insurance product. The work begins with claims, pharmacy, funding and contract data, quantifies what is structural versus what is being accepted, and produces a written view leadership can act on or set aside. Assessment first. Decision second.

What sponsors and portfolio CFOs ask us to look at

EBITDA sensitivity

Reductions in healthcare spend fall almost entirely to the bottom line. The first step is sizing the opportunity, not recommending a change.

Post-close integration

Add-on acquisitions inherit plans, carriers and eligibility rules. We map what consolidating would and would not accomplish financially.

Diligence and inherited liabilities

Run-out claims, COBRA populations, stop-loss lasers and open compliance items reviewed before they become the buyer's surprise.

Funding structure by company

Fully insured, level funded, self funded or captive evaluated against each entity's cash flow, headcount and risk tolerance rather than one portfolio default.

Multi-year cost modeling

A hold period is measured in years. Cost trend is modeled across the hold, not renewal to renewal.

Vendor and fee transparency

Broker, PBM, TPA and stop-loss compensation documented, so plan sponsors can show fees were reasonable under CAA 2021.

What the Benefits Optimization Report examines

The deliverable is a written report and an executive summary written in financial language, so the sponsor and the portfolio CFO are reading the same document.

A Benefits Optimization Report represents approximately $2,500 to $5,000 of consulting analysis. For qualified employers introduced through participating strategic partners, the consulting fee may be waived.

  • Claims experience and high-cost claimant patterns across the platform and add-ons
  • Pharmacy contract terms: rebate flow, spread pricing definitions and specialty management
  • Funding alternatives modeled against each entity's cash position
  • Stop-loss structure, leveraging and laser terms
  • Benchmarking against employers of similar size and workforce profile
  • Fiduciary governance and CAA 2021 documentation
  • A multi-year roadmap tied to the hold period, not a single renewal

How the Analysis Works

Technology-enabled analysis. Consultant-led recommendations.

The Benefits Optimization Report™ combines employer-provided benefits information, available benchmarking and analytical tools to help identify potential cost, risk and performance opportunities.

Data In

Employer-provided benefits information, available benchmarking and analytical tools are combined to help identify potential cost, risk and performance opportunities.

Technology Applied

Where appropriate, technology and AI-assisted analysis may be used to organize information, identify patterns, model scenarios and support the evaluation process.

Judgment Applied

Findings and recommendations are reviewed and interpreted through an employee benefits consulting lens before being presented to leadership.

Technology supports the analysis. It does not replace professional judgment.

Employer and benefits data should be handled through appropriate approved systems and processes consistent with applicable privacy, confidentiality and organizational requirements.

Next Step

Size the healthcare opportunity across your portfolio before the next renewal cycle.

A 20-minute conversation, a data exchange under NDA, and a written Benefits Optimization Report. You decide what happens next.

Learn whether a Benefits Optimization Report makes sense for your organization. No cost. No obligation.

Analyses, projections, benchmarks and modeled scenarios are intended to support benefits strategy and decision-making and may rely on assumptions, available data and third-party information. Actual results may vary. The Benefits Optimization Report™ does not constitute legal, tax or medical advice.