[00:00:05] Jeffrey Feldberg: Welcome to the Sell My Business Podcast. I'm your host Jeffrey Feldberg.

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Welcome to episode 83 of The Sell My Business Podcast.

Mark Gaunya is a principal at Borislow Insurance, BI, and the founder of Captivated Health located in Boston, Massachusetts. BI is highly regarded as a leading regional employee benefits brokerage and strategic advisory firm, serving employees and individuals.

Captivated Health is an innovative solution designed to help middle-market employers Bend The Healthcare Trend by joining a community of like-minded organizations who change the way they finance their health benefits to take control of their future through insightful, actionable data to make healthcare easier and more affordable for employees and their families.

Mark is an employee benefits advisor with over three decades of experience and a tireless, passionate advocate for transparency, consumerism, health, and wellbeing. He is a pioneer in the use of consumer-driven health and wellness plans to lower healthcare costs and improve overall health. Mark was named as a national Top 30 Benefits Advisor to Watch in 2017 by Employee Benefit News and Employee Benefit Advisor, and was awarded the most innovative broker of the year in 2014.

Mark is a member of the Board of Directors for the Massachusetts Health Connector and Vice-Chair of the Legislative Council for the National Association of Health Underwriters. He earned his GBA from Wharton and is certified in the ACA and Self-funding by NAHU.

Mark is a graduate of the University of Rhode Island and he resides in Hopkinton, Massachusetts.

 Welcome to the Sell My Business podcast. I am so excited about today's guest and this episode because we're doing a deep dive on an often overlooked area that is so crucial to your business, but I'm getting ahead of myself.

Firstly, Mark, welcome to the Sell My Business Podcast. Really excited to have you with us and mark, before we begin, there's always a story behind the story. What's your story of what got you to where you are today?

[00:03:31] Mark Gaunya: Jeffrey nice to be with you. Thank you for inviting me on to your podcast and for the great conversation. I know we're going to have. My story goes back, to my origin, with my mom and dad, actually. My mom and dad were both healthcare providers. They were what you would call clinicians. My mom was a nurse and my dad was a physical therapist and they're both very gifted clinicians, but they're also entrepreneurial in the way that they looked at the business of healthcare.

 I didn't grow up scientifically inclined. I grew up mathematically inclined and business inclined. So, I was introduced to the business of healthcare through my parents. So, if you really want to know where it all starts, it starts from my childhood years. And then from there, as I became an adult, my very first job out of college was working for my parents.

You see they created an outpatient physical therapy management company with six facilities in three different states and when I was in my early twenties, I got to learn a lot at a very young age about how a company can run and how it shouldn't be run too. We learned a lot of things. My origins go back to learning what not to do.

It's probably more important than learning what to do. My parents sold out of their business. I did a tour of duty with a number of national health insurance carriers. Blue Cross Blue Shield in Washington, DC and Cigna Health Care in Chicago, then I actually left one of those employers, Cigna, and I actually joined a startup health insurance company because I really wanted to change the way people interacted with their health insurance plan.

It was a company called Destiny Health, which was the US expansion of an international company called Discovery Health in Johannesburg, South Africa. Now you might say, what does South Africa have to do with the United States and healthcare. The reality is South Africa is only one of three countries in the world with a private health care system.

The United States, Singapore, and South Africa, the only three. They skipped over managed care, which we were trying to take advantage of in this country for a number of years because they didn't have enough providers to create that leverage. There are really the birthplace of that type of vehicle. And then I left that company and ultimately ended up becoming business partners with my business partner, Jennifer Borislow. She founded Borislow Insurance in 1982. I joined her in 2005 and long story short, they created what now you and I really call health savings accounts.

The two of us now are on the you know, building a brokerage and consulting firm.

Then we work with employers who invest a million dollars a year or more in their benefits. And I really want to take great care of their people. So, that's a quick as a snapshot as I can make it about the origin of my passion for the healthcare industry really comes from my family.

[00:05:41] Jeffrey Feldberg: Mark, it's a terrific story. And what really came through loud and clear is you've never forgotten your roots of what you learned with your parents and the lessons learned. And let's circle back to something that you said at the start of it, and let's focus it on healthcare. And one of the things that you said, and I couldn't agree more, often in business and life to be successful, knowing what not to do is as important or even more important than knowing what to do.

So, when it comes to healthcare and looking at a business and a growing business and having a successful and looking after your people, what should a business owner not be doing when it comes to healthcare?

[00:06:14] Mark Gaunya: You know, the reason I hesitate a little bit when you asked me the question is because every healthcare you've seen one employer, you've seen one employer. They all have their own unique way of looking at their health insurance plan or their health benefits that they provide to their employees.

Where I would start is to really debunk a lot of the false information that exists in the marketplace. So, what do I mean by that? So, if I'm talking to middle-market companies with 50 to 550 to 1,000 employees.

Those organizations invest a ton of money. There are roughly 50 million people in this country that get their benefits in that market segment in the United States about a $400 billion market cap. What they don't understand is the rules of the way the game works have been rigged against them winning. So, what do I mean by that? Well, if you look at the construct of how, what you and I call health care, there are four rulemaking entities. There's the government that insures half the people in our country through Medicare and Medicaid. Medicare for those aged 65 and older and Medicaid for those who are less fortunate with regard to income, they can't afford to pay for health insurance.

Then you have big hospital systems and there exists at least one in major metropolitan areas across the county. Health insurance companies and also pharma, big pharmacy benefit managers, or the big pharma industry. So, those four rulemaking entities, if you will, created what we call healthcare today, and they administer their construct through an opaque process called coding and billing. Every time you and I, as a consumer of healthcare touch the system, a code gets generated.

That's sent over to the insurer, from the provider where you got the care over to the insurer and it tells the insurer what you had done and what the negotiated arrangement is between that provider, where you got the care and the insurer is going to pay a big part of the bill. I don't have a problem with that construct.

The problem I have with it is that it's opaque to you and me. And so, we don't know about the price or the quality of the care before we make a buying decision. So, I asked our clients and our prospects all the time. Tell me one other thing you buy that you don't have access to price or quality before you buy it.

I usually wait a few seconds and they tell me, Mark, there is none. I'm like, yeah, there is one its healthcare. And it's the most important thing we have. Oh, well, you know, that's true. And I'm like, we've all kind of just come to accept it. So, the first thing I would say the first mistake is really not understanding how the system is constructed so that you can actually create a better system that will help you bypass much of the way in which the system works against your goals and objectives. And what do I need by that? Every employer wants to provide the highest quality health insurance and healthcare coverage they can afford to buy for their employee population.

And ultimately, they do that to attract and retain their human capital, which as you and I talked about as the most important thing any organization has. So, with that as a backdrop, what do you say to an employer who says I can't, win I expect to get health insurance costs increases like eventually someday I'm going to pass away and I pay taxes.

The old joke that the two guarantees in life are that you're going to die and you're going to pay tax as well. It's also come to being at a lot of employers, feel like they're going to get cost increases that are never-ending in sight. They don't have to think that way, Jeffery, they can actually create margin. Or if they're non-profit, if they're for-profit, they can create EBITDA from their health care plan without sacrificing any quality. In fact, I would argue getting higher quality at a lower price point because we ultimately end up teaching them the language. And once you teach someone the language, then they understand how the game works, and then ultimately can design something that gives them more control.

So, the first thing is that you do have control if you decide to take risks. The second thing is the system has really been rigged against you succeeding. And so, you have to make sure you have the right construct in order to bypass some of those things that are not advantageous to you.

[00:09:45] Jeffrey Feldberg: And so, Mark, as the saying goes, let's stop the presses because you just said something that you typically don't hear when it comes to benefits or healthcare. And you said a moment back that if you do it right, you can actually get EBITDA out of your benefits or your healthcare for your most important asset in the business.

You're human capital. Mark, how does that work? Because I'm a business owner. I'm thinking to myself, wait a minute. I just know I just write checks. It can be quite expensive for my business to keep my people insured. What would I be doing? What should I know as a business owner that can change that around and get me some EBITDA to help increase the value of my business?

[00:10:22] Mark Gaunya: So, the first thing to recognize is that your benefits line item on your P&L the expense side of your profit and loss statement is the second largest line item behind payroll. And it grows four to five times faster than any other line item you have on that expense side. Everything else on that expense side is tied to what you and I call consumer price index or CPI Healthcare has invented its own. Remember the four rule-makers they've invented their own inflation factor and they call it the healthcare trend. The Healthcare trend in most markets across the country is between eight and 10%. So, in other words, a dollar of healthcare tomorrow is going to cost $1.08 or $1.10 versus $1 now.

Everything else in life is $1.02 or $1.03 because it goes at the rate of CPI. Now, what's the evildoer inside of that, the evildoer inside of trend. It's made up of three components, unit costs, or how much does something cost? Units of service. How many of them do you buy?

And then provider mix. In other words, where do you go get the care? The facility or the location? You get it. 50% of the trend is unit costs. 35% is units of service. And 15% is provider mix. The big evil-doer is unit costs. And what I mean by that, there are contracts negotiated between providers of care, doctors, primarily hospital systems, you know, surgical facilities, these types of things, and the prices are not correlated to the quality of care that's delivered to you and me. There is no correlation between price and quality and healthcare. And the reason is, is because those prices are invisible to you and me. They're all negotiated behind the scenes. I'm sure you've felt this Jeffrey, when you access the healthcare system, you have no idea of the quality of care you're getting.

You think it's good cause you like your doctor or he or she has a nice bedside manner and talked about well by other people. But do you really know the clinical quality? Probably not. And that's not an attack on you. That's just generally speaking how it works. And then you don't know what the cost is until you get your explanation of benefits in the mail after you see the provider.

And then you're like, oh my God, I had no idea that MRI, I got costs $8,000. And what if I told you that you could get an MRI, the exact same picture? Administered by a person with the same level of education but as a different person for $500, you'd be like, well, Mark. there, no way there must be that machine must be inferior to the one that's substantially more, 8000% more expensive. No Jeffrey. That's not the case. It's the contract negotiated between that hospital where your doctor sent you because your doctor doesn't know what it costs. And the hospital that shot the picture for you. But what if I told you you could go to an outpatient facility?

That's all they do MRIs and cat scans and X-Rays and you could have a better experience and spend only $500. You would say, well, there has to be something wrong. There isn't. So, how do we create margin?

Let's go back to our EBITDA to the point you were making. If we educate people that there is no correlation between price and quality, we give them a platform and a community, which is what we're doing inside Captivated Health. That gives them access to pricing quality before they make a buying decision.

We give them not only education but then incentives to say, hey, Jeffrey, you know that MRI, you're going to get, if you tap our concierge service and you talk to a nurse, the nurse will ask you how far you're willing to drive. Well, how far would you be willing to drive Jeffrey? I don't know.

20 miles. Okay, great. Did you know there's a facility you could go to that's five minutes from your house and it's $500? No. Well is it different? Yeah, it's the same machine, but just less expensive Oh, well, how do I do that? Well, I'm going to call Jeffrey and cancel your old appointment at the hospital, and I'm going to call the outpatient facility and I'll make your new appointment there.

And then it gets better. After you leave, your employer is going to drop $200 in your health savings account because you made this choice. If you decide to do this Wow. Well, so it's my choice. I don't have to do that. If I want to go to the hospital where my doctor sent me, I could? Yes, Jeffrey, but why would I spend $7,500 more in a picture than I need to? I don't know, Jeffrey, but that choice is yours to make, because the first principle in our program is members first. Jeffrey can do what makes Jeffrey feel comfortable? Cause that's the way healthcare should work.

[00:14:41] Jeffrey Feldberg: I love that. It's a win-win-win all the way around and this actually circles back nicely offline you and I were having a conversation. So, as a business owner, when I know I'm having a liquidity event a few years down the road, I'm going to prepare for that. Hopefully, you go through the Deep Wealth experience and our 9-step roadmap.

There's a bit of tension if we're honest about it and that tension. Okay, I know I'm going to be having my EBITDA looked at the higher, my EBITDA, the more valuable my company, wherein my business, can I pull back on some of the expenses that will have me more profitable. And like all things in life. If you go to the extreme it's not going to be great. And so, mark, I'm sure we can have a whole podcast on what happens so, business if you really pull back on the benefits and the healthcare and what that's going to do to your morale and to your employees. But what you're sharing with us right now is it doesn't have to be that way.

You can get actually better service with a choice. The employees can actually get somebody for making it a better choice. Business is saving money and it's a win, win, win all around. So, the question that comes from that as a business owner, I'm thinking to myself, well, Mark. Yeah, that sounds great. But I'm too busy.

I just want to have time to look into this and I don't even know where to start, what to ask or what to do. So, Mark, what can I do as a business owner to begin that process of welcoming a higher level of service for a lower cost?

[00:16:09] Mark Gaunya: So, the first thing you could do Jeffrey is make sure you've got the right advisor. I'm sure you have lawyers and you have accountants in your life, but do you have an insurance professional, you know, an advisor, what most people would refer to as a broker? I don't really view myself as a broker, but you can put me in your broker box.

And then go to the tiniest farthest remotest corner. That's where you'll find our firm living and I'm not being facetious about that. I do mean that we really look at ourselves as a trusted advisor to the business owner, to the CEO, to the CFO, and to the leader of HR, those key people, because they have P&L accountability.

And because they have P&L accountability, they have the responsibility to make the right decisions on behalf of the organization. So, the first step is to really make sure you've got a trusted advisor, somebody who can bring creative solutions to you. And I don't mean going out to market and bidding. Technology can do that.

I mean, really sitting down and understanding, you know, we ask our clients and prospective clients, two big questions and I give full credit to Strategic Coach in this. We’ve actually met a colleague of ours and, you know, the two questions are, if I were sitting here three years from today, looking back, what would have to happen for you to feel happy with your progress?

Both personally and professionally. And then the second thing I would ask is a three-part question. What dangers would you like to see eliminated? What opportunities would you like to see cease? What strengths would you like to see maximized? And when you listen to the answers to those two questions, one being a three-parter You have all the raw material that is as an advisor to help the CEO, to help the CFO, to help the HR person understand the way they look at the world and then fit a solution that meets with their criteria. But the only way you can do what I just talked to you about is for a business owner to move from what's called being fully insured.

In other words, where you're transferring all your risk to the insurance company in exchange for a guaranteed premium for 12 months. And then we have what we call the renewal process, where we settle up, they look at whatever they look at, depending on the size of their employer. And then ultimately, they give you an increase in your premium. In most cases, business owners, with a hundred employees or less, are not getting any data. You have no idea what you're paying. The insurance carrier gives you a renewal calculation with literally 60 lines of calculation that you wouldn't even understand. And they bury pockets of profit all over that calculation.

Not because they're evil, just because the business is set up that way and they have to make them, you know, they have to make their margin too. But at the end of the day, when you move over to what's called being partially self-insured. Where you take the risk of paying the claims expenses the healthcare expenses of your people. Then you use re-insurance to help protect you. By the way, this is not new. This is something that's been around for decades and being used by any organization typically speaking over 500 employees is self-insured. They do not buy insurance from a traditional health insurance carrier because they're going to lose money there'll be overcharged. So, the first thing an employer needs to do to answer your question would be to avail themselves of good counsel and to make sure that counsel understands what their goals, priorities challenges are, and then to ultimately help them understand that if you want to really grab control of this line item on your P&L and move it from the P&L to the balance sheet. The only way to do that is to migrate from being a fully insured transfer all your risks to the insurance carrier, to being partially self-insured take the risk but then use what we call re-insurance to protect you from a really catastrophic situation. So, you still have insurance. You're just not paying as much for as much insurance. You're taking some risks.

[00:19:48] Jeffrey Feldberg: And so, Mark, let's talk about that. But before we do for our listeners, I really hope you were listening because Mark brings up such a valuable point and you know, really how you positioned it, Mark, I think is brilliant. So, just like a business owner, wouldn't go out and just hire any investment bank or any M&A lawyer.

 You're looking for the best cultural fit with an investment banker and you want to have an investment banker who's more an advocate as opposed to being transactional. We talk all about that in our 9-step roadmap, but on the health insurance side, I like Mark how you're transitioning from listening to any broker can go do a price comparison, but you're looking for an advisor who's going to come in, understand what motivates you. Understand what perhaps has kept up at nights, as you worry about things. And then from there put together a package for you that takes you off of being fully insured, to being partially self-insured. And in the process, you're saving a lot of money increasing EBITDA, but you're still looking after your people.

So, it's a win-win for everyone involved. Now as a business owner, Mark, one of the things that I'm thinking is, well, what does this mean exactly? I'm partially self-insured. And then having some kind of re-insurance. What's my risk that's going to be involved there? What's the upside? What's the downside?

[00:21:05] Mark Gaunya: So, when an employer that they want to grab control of their health care plan. The only way to really have control is to make that migration, as I talked about from being fully insured to partially self-insured. When you look at the elements of being fully insured versus partially, self-insured the first element you look at is risk. So, when you're fully insured, you're transferring all your risks to the health insurance carrier as I mentioned in exchange for a guaranteed premium for 12 months. So, there's no variability other than who you hire and who you fire. Otherwise, it's a fixed premium for singles for two people, for three people, for four people. It's standard throughout the year.

When you're partially self-insured, there are three things you can do with the risk. You can assume the risk, you can share the risk. Or you can transfer the risk. So, on the other side of the equation, if we look at what do you pay when you're fully insured? You're paying a premium and inside that insurance, carrier premium is premium taxes, and you're paying taxes on a hundred percent of the premium that you pay every month.

And you're also paying insurance company profit margins, which are built into the premium that you pay. When you're self-insured, you're going to pay two bills. One is your fixed cost bill, which is your re-insurance. So, you have re-insurance calls specific re-insurance and then another form of re-insurance called aggregate. Specific re-insurance protects you.

It's an umbrella over each one of the members of the plan that you insure. So, it limits your liability for that one person. And then you have aggregate reinsurance, which protects an umbrella over the entire company. So, that you actually know what your limit of liability is as a company, not only each person but then also limited liability for the entire company.

It depends on the state that you're located in, but that range of risks, that corridor of risk is usually 20% to 25%. So, said another way. If I gave you a full claim number of a million dollars, let's say of claims. Your downside risk is $1.2 million or $1.25 million. But the number when you're underwritten that you're provided with is 95% probable. It's not a hundred percent, but 95% based on the way it's underwritten and the actuaries look at it. So, that number at a million is where we expect you to come in on a partially self-insured plan. But your risk is that $200 to $250,000 doesn't necessarily mean you won't do better than the million, but again, it's underwritten. So, that's a viable number. Now, why is that important? You're only paying taxes on the premium associated with your stop-loss coverage, which is roughly 20% of the cost as opposed to 100% of the cost. So, right away, Jeffrey you're saving 80% on taxes because you're only being taxed on 20% versus 100%. The second way you win automatically in self-insurance remember the health care trend has profit built into it by the carrier, typically 1.5% to 2%.

So, if I gave you a 10% trend number, the carrier's trends probably around 8%. 8/5%. But they build in margin. You don't have that when you're partially self-insured because you don't have a carrier, who's building in margin. You're just paying the increase of healthcare costs from one year to the next, which in this case would probably be about 7%, 8%. So, it's not enormous, but you look at premium taxes and you look at healthcare trend you're automatically saving probably three or four points, maybe even five, depending on the State, straight off the bat. So, you always save on being, self-insured. The difference between being fully insured and self-insured, and I'll lay it out this way for your listeners. Fully insured is pay me later. Self-insured is pay me now. So, what do I mean by that? When you have a bad year, meaning you have a lot of large healthcare expenses. You're going to pay the carrier, an increase in the premium that they charge you and they build on it every year. So, it's not like you go back to zero. They compound every single year on top of each other.

When you're self-insured, you reset the clock at zero every year. So, your bad year is a bad year. That's that $1,250,000 that I talked about, but it's only one year. It doesn't compound each year thereafter. And so that really creates an opportunity to be more efficient, and create margin as well.

[00:25:11] Jeffrey Feldberg: This is incredible with what we're hearing. You know, before we go further, I have a question for you. Does anything come to mind with one of your clients and whether it's on an annual basis of what a business was paying or you took it down to a per-employee basis? Anything that you can share with us just to illustrate how powerful this can be.

[00:25:31] Mark Gaunya: Yeah. I actually have two stories, Jeffrey, and make it real. The first story is an organization down in Florida, actually in the Boca Raton area, they've got about 600 employees and we were awarded the business and came in to ultimately help them create a culture of consumerism, health, and wellbeing.

We help them implement health savings accounts, which they had never done for their employee population. And they have a pretty good demographic of people who are health conscious. You know, they're not all young, but there are health conscious. And so, they had a good foundation, to begin with. We did some calculations with the CFO and she gave us her budget.

We told her when she asked us what is your average rate of take-up, inside of an organization when you offer a health savings account in the first year and they're substantially less expensive insurance plan. So, it has a big positive impact on the financial statement.

And we told her our first-year average is 26% because we wrote a book on this called Bene the Healthcare Trend. It's a book we authored to help every employer understand in a 10-chapter format. Here's the theory, here's the application. And here's a case study. And so we've made our unique process available to our clients that guarantee without guaranteeing it, but guaranteeing our success is typically 26% of the eligible people will take the HSA in the first year because of the way in which we go about educating people.

We make a very strong linkage between health and wealth. The HSA is your financial vehicle for your healthcare. And the 401k is the financial vehicle for your financial well-being, but they both are interlocked with one another and you need to prepare for your healthcare financial retirement, just like you need to prepare for your financial retirement.

And so, in this particular organization's case, we, helped her gain 42% of her people in the HSA during open enrollment. So, we actually almost doubled our first-year number that I told her we would achieve. She only put 13 in by the way. So, she took our number and cut it in half and we, we 4X'd it.

So, we ended up saving her and she's going to create a testimonial for us. We helped her save a million dollars off her budget without sacrificing benefits. So, if you're a CFO, and every dollar is worth $15 to you. A million dollars is $15 million of value down to the bottom line.

[00:27:47] Jeffrey Feldberg: That is just tremendous. For our listeners out there, what does it take for you to create a million dollars of profit? How long is that going to take? How much are you going to have to spend? Where is it going to take you and here in one stroke of the pen, so to speak, you get it right away and you're still protecting and looking after the most important people in the world to you for your business.

And that's your employees. So, you've mentioned a few times that if you're a larger company of 50 to 100 or more employees you're eligible for this, or you can certainly do this, but what if I'm a company that's smaller? I have maybe 10 employees or 20 employees.

Is this something that I'm not able to participate in? Or how does that work?

[00:28:29] Mark Gaunya: So, when you're smaller, you can certainly avail yourselves of being partially self-insured the challenge on the smaller side of the equation is your health care expenses are not credible. In other words, underwriters and actuaries have trouble predicting what your exposure is going to be from one year to the next, if you can imagine you've got 10 people, all it takes is one sick person, as opposed to 200 people.

And one sick person doesn't have near the impact that one person would in a 10-person company. So, what does that mean? That means when you try to secure a re-insurance, the reinsurer is going to be very conservative with regard to what they charge you for that exposure. Cause all it takes is one claim and they're upside down.

In other words, they're operating at a loss with regard to providing you that re-insurance protection. This is where we leverage the power of what we're doing at Captivated Health is we're leveraging the power of this structure called the captive insurance arrangement. So, a captive insurance arrangement has been around since the 1950s.

It's not a new concept, but it's been applied to property and casualty insurance and professional liability insurance, those types of insurances, but only in the last 12 to 14 years, has it been really brought to bear in the healthcare space. So, what does it allow you to do? It allows you to be individually self-insured as an organization.

So, let's say you're 50 people individually self-insured and that'd be really hard for you to be individually self-insured on your own with 50 employees because again, your organization's claims experience is not credible and therefore the re-insurance markets can be very conservative and the math won't make sense. When you're in a captive, not only are you self-insured on your own, but you actually share risk with other organizations who are like-minded.

So, in our captivated health program, we have 30 organizations and 5,000 employee lives. If you do the math, that's about 150 employees per entity. Some are bigger, some are smaller, but essentially what they do is they come into this community and they agree I'm going to take risks.

And I want control of my health plan. I'm going to have risk limited liability for my organization, but I'm also going to share risks with other like-minded people for those claims that come in that are somewhat predictable, but somewhat unpredicted. You see, that's the volatility that exists in that middle layer of sharing if you will. Think of claims between 50 and 300 or $400,000. They could be life-threatening they might not be; it might be surgery. It could be cancer recovery. When it happens the volatility of that one large claim can really negatively impact the financial performance of the plan. But now visualize if you could share some of that claim with other people in the community who are having a good year while you're having your bad year because guess what?

They're going to have a bad year too, and you're going to help them out when they have a bad year. Now, how does that work? Each organization is underwritten from a risk point of view and each organization contributes what the underwriters believe is that organization's risk to the community. Everybody puts money in the pot.

And then what happens throughout the years as claims are being paid, money's being taken out of that pot to pay for those claims. And the idea there would be that there'd be no money left in that pot at the end of the year because the underwriters have accurately assessed the risk. The money's put aside, no one knows quite who's going to take that money, but they know in the aggregate that this money will be used.

To the extent that those claims are not incurred to the extent that employees are better educated and make better decisions about the $500 MRI than the $8,000 MRI. What happens is you actually create what's called surplus and that comes back to the owner-members in that layer. In addition, all the money below their limited liability.

So, that million dollars in claims, I gave you everything they do to help their employees purchase high-quality care at a lower possible price point. They're cutting down their unit costs which are claims they're paying. So, in that million dollars, I gave you if they can help educate their people as an example, that many of our chronic medications are manufactured in tier one, English-speaking countries. Canada, the UK, Ireland, Australia, South Africa, and New Zealand.

By the time they come over here, they’ve increased in price on average by 75%. So, what does that mean? That means you and I are subsidizing the rest of the free world with regard to medication. That's just a known fact. The United States in general is making it more affordable for other countries to afford medication, but we have a system or program called captivated man.

That an organization has a contract with the manufacturers of those medications. So, let me give you a real example. Tecfidera is a drug used to treat multiple sclerosis. It's made in one of those tier one English-speaking countries I just talked about. The cost of that drug over here for an annual supply is $70,000. If you go buy it at CVS as an example or Walgreens, or I'm not picking on any drug store chain, it could be any one of them. Where it's made and its origin the drug costs $17,000.

So, if you're insuring that risk of the first $50,000 per person, you're insuring that you're going to pay on that $70,000 drug, $50,000 of the drug cost.

But what if you had access or your employees had access to this program where it's clinically coordinated with their doctor and the doctor overseas and a pharmacist here and the pharmacist overseas. And you actually could mail order it at your house. Now it won't have the drug stores label on it. But it'll come directly from the same manufacturer the drug store gets it from.

[00:34:01] Jeffrey Feldberg: So, Mark, this is the same drug, same brand name drug, but it's coming from one of those tier one countries overseas where it's manufactured, maybe it takes a little bit longer to get here with airmail or however it's coming here. You're not walking through your local Walgreens or CVS, so it's going to be delivered to you, but it's at a fraction of the cost.

[00:34:20] Mark Gaunya: Yes. When I'm talking about this medication right now, this is something that you'd be on a scheduled basis every 90 days. It's chronic medication that you have to take. So, there was no delay in the medication. There's just you deciding I'm okay with it being delivered from the manufacturer without the label.

And the reason I'm okay with it is because my organization has offered me an incentive. First, I got educated so that I know that it's the same drug, but secondarily, my organization says, Jeffrey, if you do this, we're going to waive your cost share. You are? Why? Because we want you to take your job and also, we want you to help us save money.

You do? Yeah. So, if you get this drug from where it's made, it'll save us $50,000. We're willing to waive your $2,000 deductible. What do you think about that? Wow. Well, why wouldn't I do this? I don't know. Jeffrey, maybe the label of the drug store makes you feel safer, and if it does, and you can do that, but if you don't want to do that and you're okay with it.

And you're convinced it is the right thing to do. Your school is offering you a financial incentive and our program helps you get it done.

[00:35:19] Jeffrey Feldberg: Love that it's a win-win win. There's a choice, freedom of choice involved. You can go whichever direction, but if everyone plays together and it goes back to what you were saying earlier, there is a fixed hidden cost of 8% to 10%. Every year increases. The system is rigged against us as business owners. And this is our business, our blood, sweat, and tears that went in to building the business. Now we're preparing for a liquidity event. We can still take care of our people, the same level of care, possibly even higher, but at a fraction of the cost, why not? Everyone's a winner.

[00:35:51] Mark Gaunya: I can't say it any better. In fact, that's what we're seeing with our clients in this community that we collaborated with them to create is that they're actually now able to, in the last three years, these 30 organizations have recouped over $3 million. In cash. Now, how did they do that? We also carved out their prescription benefit management program.

So, you know, everyone has on their ID card, they can go to a local pharmacy and get a drug-filled. But most employers are working with an insurance company. That insurance company has a contract with that prescription benefit management company. And then any deal that's negotiated is between the two of them.

It doesn't really impact the employer or the employee, except for the cost of medications. But if you take control of that, which you can do in a partially self-funded environment, we pull out that component. We take it out to market. Very complicated, by the way. And we then come back and we plug it in and now we're able to go to the clients.

And now that each of them have their own contract with a prescription benefit management company, even a 50 person company, there's no way any 50 person company could have a contract with a prescription benefit management organization, but because our community is 5,000 employee lives and 10,000 people, we were able to negotiate a contract that benefited them.

So, here's the second story I wanted to share with you. A CFO for one of our organizations inside the program, he was holding a check in his hand for $38,000 and I called him. This was like six weeks ago. His name's Dan, he lives up on the line between Canada and Maine, way in the hinterlands of Maine and an area called Foxcroft, Maine.

And so, Dan's holding a check in his hand for $38,000. He goes, Mark, do you know what this check is? I'm like, yeah, it's a check for $38,000. You know what the value is to me? I'm like $38,000. We both laughed and he goes, no, this is a job. I am holding. He's a non-for-profit, he's a school. I'm holding a job in my hand.

And do you know how I got this check? I'm like, well, through the PBM contract that we negotiated. He goes, yeah. The rebates now that the insurance company used to keep, I get every quarter. He goes, and I don't like the fact that my employees are having to take this much medication. That's why I'm getting this check.

But the reality is they're taking this much medication and before we had that contract, the insurance company was keeping this $38,000 every quarter, not my school. He goes in the best part is next quarter I'm getting another check for 38 grand. It's another job. He goes, this is during COVID we're talking.

He's like, do you know what a hero I am to people walking around here saying our health plan is actually funding positions in our school. That to me is what this is all about. Without sacrificing quality, we create resources for people who need them.

[00:38:39] Jeffrey Feldberg: A wonderful story. And really, when you think about it just as a business owner when I'm looking to have a liquidity event, the system is rigged against me. It really is. It's big business. I'm one transaction in a sea of a gazillion transactions,

[00:38:54] Mark Gaunya: It's a very lonely feeling, Jeffrey.

[00:38:56] Jeffrey Feldberg: It's a terrible feeling. And that's why a Deep Wealth we're here to talk about that.

But it's the same rigged system in a different way.

When it comes to health insurance and look, how can you not know what you don't know? You can't, but for our listeners out there, the big takeaway should be, we should always be hungry and curious as a business owner of what's new out there and what's going on.

And Mark has presented himself as not a broker, which is the furthest thing from the truth. Mark is an advisor. He's an advisor for you in a way that can make a meaningful difference to your bottom line, to your people, to your business, and creates a win-win-win. So, as a business owner, we've really got to take that control and yes, it means spending some time.

Yes. It's not as convenient as making that phone call. Okay. Let's just renew again. Go to market for the same five, six quotes that you're going to get, and maybe a few points up or down and we'll go in that direction.

[00:39:51] Mark Gaunya: Yeah, we call that the less bad renewal Jeffery. That's what I call it as your broker. I come out and tell you it's going to be 15%. I then go do what I do with the care. I come back with 11 and you pat me on the back and you say, well, you beat my budget. No. It's five times worse than it should be, but that's the process. The last bad renewal process that you were talking about,

[00:40:11] Jeffrey Feldberg: And we've just been conditioned for that. So, yes, it's a little bit uncomfortable the first time around it's new, it's an investment of time, but wow the savings and the increase in EBITDA. Just think about that. You know, Mark, you use the example of those million dollars to the bottom line and you use 15 times EBITDA. Well, terrific.

Maybe it's seven times EBITDA, maybe it's 25 times EBITDA, but year over year, over year. That's just tremendous. It's huge. And talk about impressing your future buyer. I mean, we talk about this in step number three of the 9-step roadmap. When you have health insurance in place that is robust, well-rounded keeping everybody healthy but it's coming in at a fraction of a cost.

This is more on the art side of a liquidity event, but you will impress your future buyer who is walking away saying, okay, this business owner really has got a handle on this. Well, if they're doing this over here in a good way, they're probably doing this in their business in other good ways as well.

This is a company worth looking at. So, it all comes back together, full circle in such a beautiful way. And Mark, I love that last story of just how that one check of $38,000. Well, that's a job. That's changing lives. And as we like to say here at Deep Wealth, we're changing the social fabric of society in our own unique way.

[00:41:29] Mark Gaunya: I got to acknowledge what you just said. I just, I just love that, you know, it's, can we make a difference in people's lives and we can, and we want to make healthcare and benefits easier and more affordable for people. Why can't we do that? Why can't we run a successful business, but make it about making a difference and then let the value show up? Cause that's the reality of the way it works.

[00:41:46] Jeffrey Feldberg: And for listeners out there. Let me ask you a question. Is Mark the kind of guy who is saying, yeah, same blankety-blank, different day health insurance, or is this a guy that lives it, eats it, breathes it. It loves it. And it just looks at every which way to make a difference. This is who you want to have on your team, whether it's health insurance, or whether it's in any other area you want to surround yourself with really smart and successful people. And we have such a person right here right now on the Sell My Business Podcast. Mark, we can just go on and on about all the wonderful things that you're doing. We're running up against some time here, so let's, let's transition here, and let's go to one of my favorite questions that I love to ask every single guest on the Sell My Business Podcast.

[00:42:31] Mark Gaunya: Before you go there. Let me just jump in Jeffery and say, I did geek out with you quite a bit. I geeked out in my area. My profession. I hope I didn't get too wonky. You know, with regard to some of the ways in which, the programs work. Again, hopefully, your listeners will take away that they do have the ability to take control of this line of if they want to. I just hope I didn't get too wonky on you.

[00:42:51] Jeffrey Feldberg: You know, absolutely not. I'll speak for the community and I'll speak for our team here at Deep Wealth. The geekier here the better. I mean, this is the stuff that we want to hear. We want to hear the stuff that you're not going to. It's real. I mean, who else is going to tell you, hey, the system is rigged against you.

And, you know, whereas the CPA's going up 1%, 2% a year, your healthcare is going up 8% to 10% a year and you don't really have a choice in it. And it's invisible. You have no idea what it's going to cost. Well, that's what we want to hear. And that's part of the mission of The Sell My Business Podcast is to bring geeky advisors like yourself, Mark,

[00:43:25] Mark Gaunya: I surround myself. You think I'm geeky? I surround myself with people who are much smarter than me.

Bart and I have built a business that way because we have people who go deep and wide. I call them benefits superheroes. They go deep and wide in their area of expertise. And all they want to do is make a difference, a positive difference in people's lives.

[00:43:41] Jeffrey Feldberg: Mark I love that. Hey, I'm a huge geek as well.

So, It's.

[00:43:44] Mark Gaunya: Maybe that's why we get along. So, good.

[00:43:48] Jeffrey Feldberg: That? That's that there, there, there you go. So, it's the, it's the geeky Sell My Business Podcast

[00:43:53] Mark Gaunya: Yeah, that's good. I love it. I didn't mean to interject on you. I

[00:43:56] Jeffrey Feldberg: No, I, I love that too. So, Mark, as we begin to wrap up the episode, there's my favorite question. I love to ask every guest. And here's the question for you? When you look at the movie Back to the Future, you have this magical car, the DeLorean car.

[00:44:10] Mark Gaunya: The DeLorean, 1985. I remember it well.

[00:44:14] Jeffrey Feldberg: And the DeLorean, you can go back to any point in time that you want. And so I want you to imagine tomorrow morning, you wake up, you look out your window and sitting curbside is that DeLorean car, the door is opened and it's waiting for you to hop in and you can go back to any point in your life, whether it's Mark as a child or a young adult or an adolescent, whatever it may be, wherever you may go back to whatever point in time in your life, Mark, what would you be telling your younger self in terms of life lessons. Do this. Don't do that.

[00:44:47] Mark Gaunya: Yeah. So, if I could go back in time through the DeLorean, I would say that the one thing I would want to tell the younger version of myself is to develop more patience. You know, I think one of the reasons I've been a successful entrepreneur is I like to press the pedal to the metal. And my business partner will also have her foot on the gas, but she's really good about tapping the brakes.

I wasn't always so good at that Jeffery. So, I would go back and tell myself no, doesn't always have to be. You have to bust through it. Sometimes no. Is the universe's way of telling you this is not the right place for you to be. There are times that I didn't listen to the no and the no was my well there's got to be a way. So, I would go back to myself and I would say, take a breath, step back. Process. Meditate. Cause I meditate now five or six days a week and I wish I had that. So, that's where I was going with this. Is the way to develop patience is to work on your mindset. And I got a gift, three years ago, where I started meditating and it's fundamentally transformed the way I feel day in and day out. I have more patience now because I meditate. I have perspective now because I take time to contemplate things.

But when I was in my twenties and early thirties, I didn't do that. I was a rugby player for 12 years. And so, I'm used to running into things. You know, when you hear no, it's must be like what you, you just don't understand. It's not a no if you don't understand. Or it could be like, I play golf too. And somebody tells me that's an impossible shot.

And like, you're just giving me fuel to the fire to go make the shot. But sometimes, you know what, the shot's not there Jeffrey. And you shouldn't force. Sometimes you just take your medicine and move on so long answer to your question, but I would really say to my younger self, you know, invest in your mindset, invest in learning how to take a step back and invest in, taking a breath and getting perspective before you charge ahead.

[00:46:44] Jeffrey Feldberg: Wow. There's a lot of wisdom in there and Mark, I just appreciate you being so open with us and for sharing that. That's absolutely wonderful. Thank you for that.

[00:46:53] Mark Gaunya: You're welcome

[00:46:53] Jeffrey Feldberg: I'm going to put this in the show notes. For our listeners, who would like to find out more about how you might be able to help them or what they can do with their company. What's the best way for someone to reach you?

[00:47:04] Mark Gaunya: The best way would be to reach me through my website. That's Mark[at]Borislow[dot]com. So, it's mark[at]borislow[dot]com.

[00:47:16] Jeffrey Feldberg: Terrific. And I will put that in the show notes. So, it will be a point and click and really easy for our listeners. And Mark, as we wrap up this episode of The Sell My Business Podcast, I want to thank you so much for taking part of your day and spending that with us, and also sharing your insights and wisdom. And as always, I'm going to wish you to be healthy and safe.

[00:47:35] Mark Gaunya: Thank you, Jeffrey. I appreciate that. I enjoyed this conversation and, really enjoy the way in which you interact with your guests. And hopefully, you're listening community got a few nuggets. That's what I always listen for when I listen to a podcast and. hopefully, people walked away with a few nuggets just like when I listened to your podcast, I walk away with a few nuggets.

[00:47:51] Sharon S.: The Deep Wealth Experience was definitely a game-changer for me.

[00:47:55] Lyn M.: This course is one of the best investments you will ever make because you will get an ROI of a hundred times that. Anybody who doesn't go through it will lose millions.

[00:48:05] Kam H.: If you don't have time for this program, you'll never have time for a successful liquidity

[00:48:09] Sharon S.: It was the best value of any business course I've ever taken. The money was very well spent.

[00:48:16] Lyn M.: Compared to when we first began, today I feel better prepared, but in some respects, may be less prepared, not because of the course, but because the course brought to light so many things that I thought we were on top of that we need to fix.

[00:48:31] Kam H.: I 100% believe there's never a great time for a business owner to allocate extra hours into his or her week or day. So, it's an investment that will yield results today. I thought I will reap the benefit of this program in three to five years down the road. But as soon as I stepped forward into the program, my mind changed immediately.

[00:48:54] Sharon S.: There was so much value in the experience that the time I invested paid back so much for the energy that was expended.

[00:49:04] Lyn M.: The Deep Wealth Experience compared to other programs is the top. What we learned is very practical. Sometimes you learn stuff that it's great to learn, but you never use it. The stuff we learned from Deep Wealth Experience, I believe it's going to benefit us a boatload.

[00:49:17] Kam H.: I've done an executive MBA. I've worked for billion-dollar companies before. I've worked for smaller companies before I started my business. I've been running my business successfully now for getting close to a decade. We're on a growth trajectory. Reflecting back on the Deep Wealth, I knew less than 10% what I know now, maybe close to 1% even.

[00:49:36] Sharon S.: Hands down the best program in which I've ever participated. And we've done a lot of different things over the years. We've been in other mastermind groups, gone to many seminars, workshops, conferences, retreats, read books. This was so different. I haven't had an experience that's anything close to this in all the years that we've been at this.

It's five-star, A-plus.

[00:50:02] Kam H.: I would highly recommend it to any super busy business owner out there.

Deep Wealth is an accurate name for it. This program leads to deeper wealth and happier wealth, not just deeper wealth. I don't think there's a dollar value that could be associated with such an experience and knowledge that could be applied today and forever.

[00:50:21] Jeffrey Feldberg: Are you leaving millions on the table?

Please visit www.deepwealth.com/success to learn more.

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As we close out this episode, a heartfelt thank you for your time. And as always, please stay healthy and safe.