A Locum-Staffing Firm Built a Full Benefits Program From Scratch — and Bid the Ancillary Down ~22%
Company Profile: A multi-state locum-tenens staffing company (roughly 50 benefit-eligible lives) that was moving clinicians from 1099 to W-2 and needed a real employee benefits program built from the ground up. (Client name withheld; the figures below are real, drawn from the carrier proposals and the RFP Benefitra ran.)
The situation: a staffing firm going W-2, with no benefits program to inherit
Converting a contractor workforce to W-2 is the right long-term move for a staffing company — but it means standing up an entire benefits program where there wasn’t one. No incumbent plan to renew, no prior carrier relationships, just a multi-state census of clinicians and a need to offer competitive coverage that helps recruit and retain them without blowing up labor cost.
The firm needed three things at once: a medical plan that fit a growing, claims-unpredictable group; an ancillary suite (dental, vision and more) priced sharply; and a way to fund it that worked with how staffing companies actually pay people — by the hour.
The work: self-funded medical, an hourly H&W allowance, and a competitively-bid ancillary suite
Benefitra built the program in three parts:
- A self-funded group medical plan — the right structure for a growing staffing group, giving the firm transparency and control instead of a take-it-or-leave-it fully-insured renewal
- An hourly health-and-welfare (H&W) allowance — an amount set aside per clinician for each hour worked toward benefits, the way staffing firms fund coverage for an hourly workforce
- A dental & vision suite put out to bid — an RFP across five carriers (the incumbent plus MetLife, Equitable, Reliance Matrix and Guardian) so the ancillary lines were competitively bid, not defaulted. The firm selected Equitable.
The result: the ancillary suite, bid down ~22%
Running dental and vision as a competitive RFP — instead of renewing the incumbent — is where the documented dollars showed up. The firm placed the suite with Equitable:
| Incumbent (current) | Selected — Equitable | |
|---|---|---|
| Dental (annual) | $48,050 | $36,869 (~23% lower) |
| Dental + vision (annual) | $55,307 | $43,302 |
| Annual ancillary saved | — | ~$12,005 (~22%) |
Figures from the five-carrier ancillary proposal summary; the firm placed the suite with Equitable. The medical plan was built self-funded as a from-scratch program, so it has no prior-carrier savings figure — the documented dollar result here is the competitively-bid ancillary suite.
Why this structure fits locum staffing
Default to a fully-insured package off one carrier
Fast, but it leaves money on the table: ancillary lines get renewed instead of bid, and a fully-insured medical plan gives a growing group no transparency into its own claims.
✗ Convenient, not optimizedSelf-funded medical + H&W allowance + bid-out ancillary
A program built around how a staffing firm actually operates:
- Self-funded medical for transparency and control as the group grows
- An hourly H&W allowance set aside toward benefits, sized to an hourly workforce
- Ancillary bid across five carriers, placed with Equitable — ~22% / ~$12K saved vs renewing the incumbent
The honest trade-offs
Self-funding puts a growing group closer to its own claims — more transparency and upside in good years, more exposure in bad ones, which is why it’s paired with stop-loss protection and suits a firm that wants control rather than a hands-off plan. The hourly H&W model takes more administrative coordination than cutting one premium check. And because this was a brand-new program, the headline dollar result is the ancillary RFP, not a medical “savings vs last year” — there was no last year. What the firm got is a complete, competitively-built program from a standing start, with every line earned rather than defaulted.
Outcome: a complete benefits program, built and bid from zero
The staffing firm went from no benefits program to a full one: a self-funded medical plan sized for a growing group, an hourly H&W allowance to fund coverage for an hourly workforce, and a dental/vision suite placed with Equitable that came in about 22% (~$12K) cheaper than the incumbent because it was put out to bid. For a company converting clinicians to W-2, that’s the difference between “we offer benefits” and “we offer benefits worth leaving your old arrangement for.”
Built from scratch · self-funded medical · ~22% off ancillary, placed with Equitable
The lesson a staffing CFO takes from this: the ancillary lines everyone renews on autopilot are worth bidding — here it was ~$12,000 a year, found simply by making five carriers compete.
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