Co-sourced to outsourced: A success story

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By Julie Sinke | 22 January 2017

The challenge

A client of Milliman was a co-sourced client for over seven years. Co-sourcing is when the client and Milliman share responsibilities for the plan’s administration, whereas full outsourcing is when Milliman handles all of the work. The client was part of a larger umbrella and decided to disaffiliate from the group, which meant they would no longer have access to the retirement system infrastructure to perform their plan administration.

Like many other clients with small plans, the work done in-house was manual and time consuming. One or two individuals were responsible for the work from beginning to end, including taking phone calls for calculation requests, creating and mailing paperwork, reviewing documents when they were returned, communicating with participants, and creating and sending the payment information to the payer on a case-by-case basis. The disaffiliation provided the client an opportunity to seek a more efficient solution to administer their plan.

The solution

The client turned to Milliman to provide the more efficient and streamlined solution they were seeking. We broke down each of the administration processes that we could administer and walked them through what we felt was the most effective and efficient way to administer the work.

They agreed to become a fully outsourced client, which provided them access to a number of great features:

  • A participant web portal where participants can review and update personal information, run, request, and print benefit calculations, upload completed election forms to return to Milliman, and designate pre-retirement beneficiaries
  • A dedicated call center to answer questions, take calculation requests, and help use the participant web portal
  • A team dedicated to reviewing calculations to ensure the accuracy of the information provided to participants
  • A team dedicated to providing routine audit support and developing and distributing plan communications such as the Annual Funding Notice, Summary of Material Modifications, and Summary Plan Descriptions.
  • Automated standard procedures to reach out to participants at various points in time, such as termination, approaching age 65, and approaching age 70.5
  • A team dedicated to reviewing returned election forms, reaching out for any missing information, and preparing payment instructions to the trust with multiple levels of review

Typically, in a fully outsourced solution, Milliman would also be responsible for retiree administration. We would transmit the payment information to the trust and after the payment is set up, if the person wanted to make changes, we would transmit those changes to the trust. One unique aspect of the new outsourced agreement was that the client had a relationship with a vendor that handled the retiree administration and they wished to maintain the relationship. We worked closely with both the client and the vendor to understand how they had been working together and communicating with each other. We provided feedback and suggestions about ways we could adapt the process going forward to better suit all of our needs. It was crucial that we remained flexible to ensure that the client’s satisfaction was the number one priority.

The outcome

The client was happy to no longer be burdened with the time and expense of manual work and could complete their disaffiliation knowing that the service to their participants would be improved and uninterrupted. We were able to enhance the communication materials and streamline the communication method and timing between Milliman and the retiree vendor. The end result was an efficient and well thought out service model that best met all of the client’s needs.

When the transition came to a close with the go-live date upon us, the client reported that they felt like the plan and its participants were in good hands with Milliman. They also felt confident we knew what we were doing and we would ensure the work was done with the utmost integrity and professionalism.