Plan Health Scoring

Stop Talking About Fees! Focus on Plan Health Scoring

  • June 7, 2017


Unfortunately, with all the current discussion about fees, investments, massive disclosures and the fiduciary regulation, there has been a central piece missing from client discussions and how we evaluate success: participant outcomes. It seems that the government and the industry have forgotten the primary reason we have retirement plans in the first place: to provide an employee with enough money to retire. If a plan advisor says that all funds on a platform are low-cost index funds, then often the perception is that nothing else needs be discussed. The focus is always about cost – never about value. This simply isn’t sufficient. We need to do better; but the question is how?

Do More with Plan Health Scoring

Although technology has created an expectation by plan sponsors for on-demand information, the tools to evaluate plan health data in real-time have been lagging in our industry. Consider the following:

  • Do you have difficulty quantifying plan health and benchmarking plan progress?
  • Do have a tool that helps you measure plan progress by setting goals for specific plan and participant metrics that you can create during a client meeting?
  • Do have a tool that helps you answer plan and participant metric questions with easy-to-read charts you can call up, on-demand?
  • Is it a challenge to convince a plan sponsor that change is necessary?

What Is Plan Health Scoring?

Fundamentally, Plan Health Scoring is all about refocusing the conversation with the plan sponsor to participant outcomes and a plan’s ability to deliver a successful retirement. Up until now, the industry has focused on “How much will this cost and what will you, my advisor, be paid?” Those days are over.

Plan Health Scoring can measure results based on key benchmarked components of plan health to create a weighted score from 0-100 covering the following areas:

  • Participant metrics
  • Plan metrics
  • Plan design
  • Investment lineup and design
  • Access to advice and education
  • Access to decumulation products

By using the score over time, you can demonstrate progress, suggest the need for plan design change, upsell campaigns, and directly show how your efforts have impacted the score. It’s a win-win.

Measuring with Standards & Benchmarking

No matter what you do, it’s important to measure progress and look at analytics. With the use of third-party benchmarks and third-party standards, progress towards benchmarks and standards can be measured and weak points identified. Weaknesses can be targeted for campaigns and plan design changes – helping you the plan advisor demonstrate value.

We’ve been asked, “Does one size fit all size plans?” The answer is “No.” Not all plans should be scored the same way – large plans tend to have more services and more complex investment lineups. Small plans don’t always require extensive services, like auto-enroll, when the CFO can verbally remind each employee about joining the plan. Plan Health Scoring is a growing and necessary trend but the solution must offer flexibility in scoring parameters by client, platform and industry.

At Fluent Technologies, we urge you to think beyond fees and investments. We challenge you to refocus on participant outcomes, embrace the plan health mantle and change the conversation from cost to value, so that you can tell the whole story.

Fluent Technologies recently introduced UtopiaAdvisor, the industry’s first and only interactive and integrated plan and investment evaluation solution. Learn more about UtopiaAdvisor. Visit our website

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