AMERICAN BENEFIT ADVISORS
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Self -funded Group Health Insurance
With a self-insured plan, the employer becomes the insurer. Most often, employers will partner with a PPO to provide services for the plan. A third party (a TPA) is engaged to handle claims and processing. Because self-insured employers run the risk of large catastrophic claims, they will purchase stop-loss insurance to protect them in such an event. Even with the additional expense of stop-loss insurance, employers benefit greatly from a significant savings, increased cash flow, tax advantages and more control over the benefits the plan offers.
With healthcare reform and the rise in healthcare costs and premiums, employers are finding self-insured funding to be a favorable option in saving thousands in premiums along with many other benefits. Today, self-insured plans are considered to be good options for both small and large employers.
Partially or Shared Funding Plans
A Shared Funding Plan allows employers to have the advantages of both a fully insured (traditional) plan and a self-insured plan.
With a Shared Funding Plan the employer partners with an insurance carrier and selects any of the fully insured plans that carrier offers. The insurer administers the plan like they normally would, processing claims and collecting premiums. However, like a self-funded plan, the employer pays claims and secures stop-loss insurance to protect from catastrophic claims. And, similar to the self-funded advantages, employers save thousands in lower premiums, administration fees, taxes and any unused premiums are reimbursed to the employer at the end of the plan year.