More than 30% of midsized companies with 100 to 499 employees are now self-funded. They have discovered the benefits of self-funded insurance.
That number represents a 20% increase in the past year alone, according to the Employee Benefit Research Institute.
As a broker are you taking the necessary steps to actively educate your clients? Employers are more open to alternative methods of remaining ACA compliant. Explaining the benefits of self-funded insurance is easier than you might think. Introducing employers to the benefits of self-funded insurance and lower health insurance cost with greater control of benefits starts with data analytics. For employers to truly regain control of their health insurance spend and maximize their self-funding experience, start with claims analysis.
Claims analytics supplies employers with the data on the overall health of their company and employees.
Sharing claims data with employers allows them to fully understand their risk and how that risk relates to their cost. As a broker, you have to know your customer and decide if they want to have the data parsed granularly down to the individual or, if they want only the high level “10,000 foot” important facts.
At Innovative Health Insurance Advisors we believe that knowledge is power. The more knowledge employers have the better they are equipped to understand the benefits of self-funding. When employers understand the cost benefit of self-funding, they can break the handcuffs that the large insurance companies have over them.
Self Funded Insurance works like this:
The employer retains funds when health claims are lower than expected. Self-funding a health plan is often less costly because there are no profit or risk margins to pay to an insurer. Additionally, there are no state-levied premium taxes. With self funding insurance, companies pay for healthcare expenses out-of-pocket as they are received. This differs from traditional health insurance in which an employer pays a pre-determined premium to an insurance carrier, a policy known as a fully insured plan.
