For several weeks we’ve been hearing about Zenefits’ latest offering. In this new update, Zenefits will offer their technology to clients without requiring the Broker of Record (BOR). Basically, this means that Zenefits will allow a client to transfer their BOR to another broker and will offer a beta technology platform separate from the BOR.
To allow clients to transfer their BOR to another broker through their platform, Zenefits is charging $5.00 PEPM for the onboarding and ACA modules. Moreover, they’re charging an additional $4 PEPM for the benefits administration, resulting in a total of $9.00 PEPM. At this point it’s still unclear whether the actual technology is the same as what the client has been using. Is it actually a different platform? We’ll be investigating this further.
Zenefits Latest Update: Is It Worth It?
On the surface, not requesting a BOR may sound like a good opportunity. After all, it can enable the client to change brokers with minimal disruption on the technology side. However, keep in mind that Zenefits is charging the client $5 PEPM. This is for a system that we would expect our clients to pay less than $3 PEPM for through their payroll provider. On the benefits administration side, no EDI feeds are available. The broker will have to manually submit all adds/terms/changes on the clients’ behalf.
That really is $4 PEPM for nothing more than an enrollment tool. This also adds significant administration burden (not to mention E&O risk) to the broker. Because of this, we think this offer is worth reconsidering long-term.