The Benefits of Self-Funding Healthcare


August 31st, 2017

Self-Insured healthcare plans are increasing in popularity because self-insured employers can pay for claims out-of-pocket as they are presented, instead of paying a predetermined premium to an insurance carrier for a Fully Insured plan. Businesses are able to better negotiate administrative services and reinsurance as effectively as that of a larger, single employer. 

Facts about Fully-Insured Plans:

  • Lack of transparency
  • Retrospective rating
  • Volatile rate cycle
  • Carrier shopping (switching different carriers every year, new cards, etc.)
  • No direct savings from wellness initiatives 

 

Facts about Self-Insured Plans:

  • Now available to small employers

 

  • Full transparency 
    • Monthly reports detail where every dollar is spent for claims, administration and insurance protection.
    • You are fully aware of rate development for their next renewal cycle. 

 

  • Control
    • You have collective purchase power of stop-loss insurance.
    • Specific claim utilization history allows you to make design changes to benefits both employees and your business. 

 

  • Stability
    • You have real-time data throughout the plan year, which creates a more predictable healthcare line item. 
    • It allows a safety net for protection in both good and bad claim years. 

 

Learn more about our Genesis Healthcare Consortium, one of our self-funding consortiums. We would love to set up a meeting to talk about if your company would benefit from a self-insured plan.

Our Employee Benefits team was just voted “Best Employee Benefits Firm” by the readers of the Central Penn Business Journal!