Your Employer Picked Your Carrier. If That Carrier Doesn’t Cover Your Doctor, You Never Had a Choice.

Brandy Burch’s route into benefits came from the CFO’s chair, not from insurance. Her background is accounting and finance, and by preference she took roles at smaller businesses in Kansas City — organizations needing transformational change, often with long-tenured staff and a need to attract newer talent.

What she found there is that benefits are a serious performance lever and a serious EBITDA lever, and that almost every incentive in the system pushes toward inertia. HR teams resist disruption to employee populations. Brokers get comfortable and stop pushing employers through change, because change is how a broker gets terminated. After a few years of that, an employer is badly overpaying.

Then there is the part that genuinely bothered her. In self-insured and group populations, a single major claim can reset the entire budget — other carriers decline to quote, the incumbent hands you a 40% renewal, and the finance seat has to absorb it by cutting programs, budgets, or people. She describes herself as a people-first leader having to do the impossible with the numbers.

And underneath that, a privacy problem she calls gross: in group benefits, employers learn about cancer diagnoses, and know an employee is pregnant before it has been announced at work. On individual policies, none of that flows back to the employer or the broker.

In Episode 130 of InsurTechTalk, Brandy and I covered what Benefit Bay actually does, why the company deliberately went to market through brokers when competitors went direct, and the freemium failure that reshaped the business in its first year.

About Brandy Burch

Brandy Burch is the CEO of Benefit Bay, an ICHRA platform founded in April 2021 that lets employers fund benefits while individual employees choose their own carrier and plan. The company is remote-first across 18 states. Brandy joined as founding COO/CFO — the operations and fintech builder — and was appointed CEO by the board roughly a year in, after the founding CEO departed. Her background is accounting and finance, with a master’s in finance, built on the employer side of the benefits equation.

What Benefit Bay Actually Is

The company spans more categories than a single label captures, and Brandy walked through each layer:

• SaaS for the broker — a subscription sales tool, a conventional SaaS model
• Benefits administration technology for the employer
• Licensed agent support for the employee — education, enrollment, and help making the choice, staffed by humans
• Fintech — Benefit Bay actually moves the dollars
• An agency — Benefit Bay Insurance Agency, licensed in all 50 states and appointed with carriers, with direct carrier integrations

Her point about why the agency piece is non-negotiable is the one most likely to be skipped by a pure software company: people need help. Some employees are not technically comfortable with decision-support tools. Some work in environments where they do not have ready access to them. Someone has to stand in that gap.

The Choice Problem

The status quo Brandy is attacking is narrower than most people realize:

• A typical employee gets one carrier and maybe two plan designs — a high-deductible option pairing with an HSA, and an HMO
• Both sit with the same carrier. If that carrier does not cover your doctor, you did not have a choice; your employer made it for you
• Employees typically get 10 to 15 days to make a decision that binds them for a year

Under ICHRA, the employer sets a budget and the employee chooses from any carrier and any plan available in their market. Carriers file individual and family plans annually, priced by ZIP code and age, which creates the complexity Benefit Bay’s technology absorbs:

• Load the incumbent plan and determine its actuarial tier — say, a gold plan
• Calculate what each employee needs, wherever they sit — New York, LA, Florida — to have equivalent buying power in their own market
• Let employees buy up or buy down from there as a personal decision
• Handle the regulatory layer automatically: affordability rules, the requirement to offer lowest-cost silver, and the constraint that no class may exceed a three-to-one ratio against another

The scale problem for brokers is stark. A typical broker is appointed with three carriers, maybe five. Individual choice means roughly 303 carriers nationally, plus relationships and multi-state compliance for each. Most brokers also have clients with employees outside the markets where they are licensed. That gap is Benefit Bay’s product.

Who Pays, and Why That Matters

Brandy laid out the revenue model transparently, which matters because it determines whose interests the company serves:

• Brokers pay a SaaS subscription and act as the sales channel
• Employers become clients and pay Benefit Bay directly when ICHRA is right for their population
• Individual policies may pay a small commission — $15 to $20 — but not all carriers pay commission on individual products, and Benefit Bay discloses it when they do

That last detail is the important one: because the commission is trivial and inconsistent, the company is not steered by it, and employees genuinely choose what they want.

Her framing of the accountability: Benefit Bay can be fired by the employee, the employer, or the broker. All three have to have a good experience, which requires treating every link in the chain as equally important.

Broker-First, Against the Pressure

This was the strategic decision Brandy is proudest of, and it cost the company speed.

• Benefit Bay committed to going to market through brokers first, and did not waver
• Brokers were slow to adopt, because they had the most to lose — they feared a partner would erode their value or cut them out
• Competitors played both lanes: marketing direct to employers while telling brokers they would bring them along. Brandy’s assessment is that this makes trust nearly impossible to build
• Repetitive, consistent work over time was what eventually established that Benefit Bay was not going to cut brokers out

The payoff arrived late but decisively. Small employers were the ones willing to go direct early; the larger employers now moving to ICHRA want a partner, and brokers serve those larger groups. Benefit Bay has 3x’d for three consecutive years.

Capital: $200 Million to the Category, $3 Million to Her

One of the more striking numbers in the conversation: roughly $200 million in venture funding went into the ICHRA category over twelve months, of which Benefit Bay raised $3 million.

• Investors are smaller Midwest venture firms — Ohio and Michigan — plus a high-net-worth individual on the cap table
• The company has done a seed round and a safe round, with no Series A
• A four-person board: three investors and Brandy, which she notes is an even number that regularly produces two-and-two splits, with the earliest investors more inclined toward an exit and the later capital aligned with her on a longer strategy

We spent a while on the coastal capital blind spot. There is exceptional talent across the Midwest that funds systematically overlook, and Brandy’s own investor base reflects the regional networks that actually showed up.

The Freemium Failure

Asked for a failure, Brandy gave the clearest example anyone has given me of a well-intentioned strategy destroying a year.

The founding CEO was a broker, and his conviction was that brokers would never pay for the technology. So Benefit Bay gave it away free — often to his friends.

What happened over that first year:

• Roughly 100 agencies used the technology, the team’s time, and its expertise at no cost
• Because they had not committed anything, they did not bother to learn the tool — so Benefit Bay’s team ended up on all the calls, doing the work
• Some then took what they had learned to a cheaper competing technology that lacked the surrounding talent
• The company ballooned to 33 people servicing brokers who yielded very little volume and very small cases
• Nobody had defined an ideal customer profile, so they were servicing anyone

When the founding CEO left after a year and the board appointed Brandy, she killed the free model and instituted a SaaS agreement — $119 to $199 a month per agency location. Her reasoning is that the price is a self-selection mechanism: a broker unwilling to pay that for a premium tool that improves client service is a broker competing on being the cheapest, and is not a fit.

She has taken sustained pressure over this. Investors and prospective investors repeatedly ask whether she would grow faster without the subscription. Her own single sales rep — for most of her tenure the company had exactly one, now four — told her how much harder it made getting to signature.

Her answer is that retention soared. The brokers who sign are the ones who care about their clients, and they churn far less.

Her advice from it: if you are building something with value and you believe in that value, stand in it. Growth will be slower at first and the results will be better. The alternative is the race to the bottom.

She and I agreed on one carve-out: design partners are different. Two of Benefit Bay’s earliest partners had memorandums of understanding — free access in exchange for genuine input shaping the product — and both are paying members today. That is a real exchange, not a giveaway.

The Broker’s Actual Problem

Brandy’s read on why brokers need this is a good summary of the pressure that segment is under:

• Brokerage agencies are consolidating, with mega-national chains competing against regionals for the same employers
• Compensation has come down, partly driven by transparency rules, so brokers must manage a larger book to stand still
• Employers are receiving competing pitches from direct-to-employer platforms, PEOs, direct primary care, and payroll providers like Paychex and ADP
• Every technology partner a broker introduces is a risk to a hard-won client relationship — including cyber exposure

Her comparison: brokers are facing what physicians face — lower reimbursement, so they must see more patients. Everyone in the chain is doing more with less, which is precisely when the right tools matter.

Key Takeaways

• Employer-chosen benefits are not a choice at all when the single carrier does not cover your doctor — ICHRA moves the decision to the individual while the employer keeps a budget
• Equivalent buying power across markets, not equal dollars, is the actual math problem, and the regulatory layer sits on top of it
• An agency and licensed human support are not optional alongside the software; many employees cannot or will not self-serve a decision this consequential
• Individual policies also remove the employer’s and broker’s visibility into employee health data
• Going broker-first cost Benefit Bay speed and made trust possible; playing both lanes makes it nearly impossible
• Freemium consumed a year, ballooned headcount to 33, and attracted brokers who would not learn the tool and would leave for something cheaper
• Charging even a modest subscription functions as customer qualification, and retention rose sharply after the change
• Design partners trading input for access are a legitimate exception to that rule, not a contradiction of it