Portfolio Insights – SSDC

Issue 16, Dec2024

The Leverage Health Portfolio Insights Series

Welcome to the latest edition of Leverage Health Portfolio Insights, where we continue our mission to highlight the innovators and leaders driving transformation in the healthcare industry. In this issue, we are honored to feature an exclusive interview with Michael neal, CEO at SSDC Services, conducted by our founder, Richard Lungen.

Richard Lungen, Leverage Health

Michael, thanks for being with us here today. When did you take on this role at SSDC and can you explain the process since then to now?

Michael Neal (SSDC Services)

I took over as CEO just about two years ago. Prior to that, I had been the COO for 10 years. We’re really moving into the active population. By active population, I mean the working population. Prior to that, we were focused, primarily with 65 and over retirees, people that are inactive and this population is not working for their former employers. We’ve launched into that market full force.

When I took over as CEO, we really pushed forward with health plans as well as getting back into states and municipalities, an initiative with Taft-Hartleys and unions. We’re also focused on some of what we call our ancillary products, DAS

Right at the beginning of COVID, we launched an agency in order to ensure that consumers and their payers who are in the middle of this material transition end up with the best possible coverage solution. So we started in MIPS, started selling Medicare related insurance products, which is going really, really well.

So that’s been the journey, especially the last two years.

Richard Lungen

Michael, what did you do before taking on the CEO role? And also maybe tell us about the team and experience your colleagues have in this space?

Michael Neal

Sure. I was the COO for ten years prior to becoming the CEO, with the company all that time.

I was part of a team of three which acquired SSDC from Assurant.  Assurant had held SSDC for about 13 to 14 years. Prior to us purchasing it from Assurant, SSDC has been around for over 45 years at this point, so our roots in this very specific world of Medicare Maximization are as deep as they come.  It is truly amazing being a part of an organization with the history of SSDC where we can say that we have saved our customers literally billions of dollars over our time with them, and many of whom we have been working with for decades.

SSDC has been around for a long time, in multiple iterations, but prior to us getting involved and me joining the company, we were largely focused on long-term disability advocacy and pre-65 retiree advocacy for private companies. We had the occasional public entity, but we really pushed SSDC back into public entities over the last two or three years which has been focused more on the active population. And now with the additive focus with Leverage Health on working with larger health plan carriers on their fully insured populations, where the potential value to the plans and the large memberships is frankly astronomical.

Richard Lungen

That’s great. Thank you. So we’re going to take a step back. What is the gap in health care and or the problem that SSDC solves?

Michael Neal

That’s a really interesting question because, while we are really important and impactful to health payers, we’re not what you’d consider a core health care service.

We consider ourselves health care adjacent. What we mean by that is we don’t have a direct impact on a patient’s care, their health coverage, or their health and well-being.

However, we do have a direct impact on their income and their ability to obtain Medicare as well provide additional options for insurance coverage. There are lots of individuals out there that are disabled struggling because of health care problems or because of medical conditions. No one gets to SSDC on a win streak. If you are leveraging our services or if you are engaging with us, you are not in a good spot because you are likely unable to work due to a health care condition.

As pretty much everyone knows, dealing with the government is difficult.  It’s hard for companies and it’s particularly hard for individuals.  In our case, the process for people in obtaining social security disability is just difficult. There’s a lot of confusion, it takes a long time, and people don’t really understand the mechanism.  Most think of social security disability as the primary way to obtain additional income, especially for people that don’t have other income replacement products or have income replacement services elsewhere, either through LTD, disability pension or a similar benefit.  In short, for the people that need it, they really, really need it.

For a lot of these folks, it is the only option they have for getting additional income because of being disabled, but they don’t understand that it is also the primary way of getting on Medicare under the age of 65.

There are only three ways someone can receive Medicare Benefits under the age of 65, and by far, 95%, probably closer to 99% of them, are because of people becoming social security disability eligible.

The other two ways are ALS and end-stage renal disease, which each have their own, specific government benefit designations. Those are really the only ways you get on Medicare under the age of 65, and that’s incredibly valuable for the organizations providing the retiree health care as well as for the individual because they may be on some sort of commercial plan or they may be on Medicaid.

Getting social security disability and getting Medicare provides them with material resources and real options, and often better coverage for their specific situation. While we may not be curing something or helping someone manage their clinical condition, we have a direct impact on their overall health and well-being by providing them with financial relief and broader health care coverage.

Richard Lungen

That’s fascinating, Michael, thank you. One of the things that I enjoy about my job is you learn something new every day.

When we met you, I didn’t even know what Medicare Maximization was and that prior to the age of 65, a person could literally go on Medicare based upon an unfortunate set of disease states and clinical conditions. Plus, to a health plan or to large employer, this is a very costly line item. So that was a great explanation. Thank you.

So, the next question, what is SSDC’s unique approach and differentiation? Is it technology? Is it the fact that you and your colleagues have been in this business for 40 years? Is it expertise? Is it the process?

Michael Neal

We’ve been a pioneer in Medicare Maximization. In fact, it may even be safe to say that we created this whole approach from a systemic standpoint. We’re constantly developing as there are new opportunities and new technologies that help SSDC develop their processes and evolve engagement approaches.

We are very much focused on some recent changes that the administration has made. For example, something as simple as going from wet signature to e-signature is actually going to be revolutionary in our process.  Today we meet a consumer, inform them of and get them excited about their real options going forward and that we can really help them.  We get them teed up act and then we have to wait because we have to send them and form through snail mail, have them sign it, and then wait for when (or IF) it comes back.

Well, guess what? We don’t always get that form back. So just the ability for us to get someone excited, get someone engaged, and say, look, check your text message right now. We just sent you an electronic document that you need to sign via electronic signature, and we can continue this discussion right now and get this process started.  It’s a huge improvement for the consumer, and far more geared to how those consumers actually want to engage with a solutions provider.

Additionally, we are working with an AI partner and are already seeing the benefits of that work. Historically we’ve very much focused on identification in the active retiree population. In our experience the likelihood of you becoming disabled as you get older gets to where it’s a significant percentage. 10, 15% of 60 year olds and 61 year olds become disabled at some point. That’s just the way it works. As we get older, we have a material physical break down, and then we would qualify for Disability.  The really critical part in driving value for health plans and employers is the precise “when” this happens, in order properly coordinate the activities and benefits around this member.

In an active Commercial population, it’s one per thousand, two per thousand that becomes disabled in any particular year.  The needs of these people in this situation are immediate when this happens.  And at the same time the window for the health payer (whether a Plan or an employer) begins to get the maximum impact to the costs of their business. We can see today that this AI-driven approach doing a better job of identifying people that are currently disabled, and we know that this is just going to get better over time.

I tell my team right now; we’re scratching the surface on what machine learning and AI is going to do in this industry. We haven’t even thought of what it’s really going to do. We’re committed to staying on the cutting edge of that.

We believe that it’s going to give us an opportunity to identify and help more people because that’s really the business that we’re in. We’re helping people obtain Social Security disability and therefore Medicare. Then those two programs provide additional income and options and savings to someone. That’s really what it comes down to. I would say our advantage is that we’re continuing to develop our proprietary processes, it’s the way we approach things and it’s leveraging technology.

Ultimately our customers, and their members and employees are going to be the beneficiaries of this work.

Richard Lungen

Michael, can you let us know how does SSDC charge for its services and do you go at risk for your services?

Michael Neal

Yes.  Everything starts with the commitment to drive incredibly high value for our customers – we believe that we deliver some of the highest ROI of any company performing any function for organizations on the hook for health care costs.  At its core our approach can be summarized in two foundational principles:

• The customer, whether an employer or a health plan, is always ahead in terms of ROI. In practice this means that the real value received by an SSDC customer, relative to any fees that they pay to us, is always a high multiple in the customer’s favor.
• That the services we provide seamlessly supplement, and do not duplicate, the work that is being done inside of the customer environments. This is crucial to both avoiding confusion for customer teams and also being able to clearly validate our ROI.

When we get started with a new health plan, we look retrospectively at the current book of business.  After that we work prospectively to identify and help people as the may become disabled.  For the payer, the ROI starts strong at 5:1 or better, which we guarantee.  The ROI builds every year, eventually reaching a rate of over 30:1.  The only time we charge the customer is when we are successful in helping a member.  There really is no better solution in healthcare in my opinion.

We are developing a program to put even more of a guarantee behind our savings. The savings are extraordinary. Getting someone on Social Security disability costs between three to five thousand dollars. But the savings that Medicare provides the organization that is at-risk is in the neighborhood of tens of thousands and upwards of a hundred thousand dollars for each member.

Richard Lungen

Terrific. So last question. With all this excitement and the value you create, what’s ahead for SSDC with the remainder of the year and into 2025.

Michael Neal

We’re in a busy season right now. We’ve got a bunch of implementations of large unions and Taft-Hartly Trusts. We are also meeting, in large part because of our partnership with Leverage Health, with health plans. We are having discussions with two large health systems. And so it is just full bore on that front. And then we’re in the midst of a pretty significant technology upgrade.

We have never been a tech heavy industry, in large part because the administration required, with things like wet signatures. But with that changing, and the population we’re engaging  (10, 15 years ago, pre-65 retirees didn’t have smartphones) now, we’re calling them on cell phones, we’re communicating through text message, we’re communicating through email more and more. There’s no going back there.

So with the administration changing, we now do have a technology component in our model that not only is allowing us to be more efficient, but it’s also allowing us to be more customer friendly. We’re trying to meet people where they are. If you want to call and talk to us, or you want us to send you a form in snail mail or if you want fax us a form back, that’s great.  But we’re seeing more and more people responding to text messages and wanting to sign forms electronically. So we’re really focused on providing more technological options.

And as I mentioned earlier, we have ancillary products. We’re rapidly growing our Medicare Advantage insurance-related products because it’s a great fit with what we do.

We help people get on Medicare and if they don’t have retiree health care or if they would like to understand what their options are to their current retiree health care plan, we’re there to be able to help them with that.

We also have another suite of services. The largest is what we call DAS, which is a prepaid advocacy service that’s very, very different. It’s not contingent fees. It’s all prepaid, value add. We’re working with some large voluntary benefits carriers to try to determine whether not it’s a good fit as an add-on to their services. A lot of exciting stuff in 2025.

Richard Lungen

Thank you, Michael, for your time.

Michael Neal

Thank you.