A self-funded program is one in which the business pays the actual claims and essentially assumes the role of the insurance carrier. More common with larger companies — those with at least a couple hundred employees — the self-funded company retains the risk of paying for their employees’ health care themselves.
With healthy employees and few medical expenses, the self-funded company will immediately realize a positive impact on overall health care costs. On the other hand, unhealthy employees with surprise medical expenses, could become very costly. Self-funded companies often carry stop-loss insurance to reduce the risk associated with these surprise medical expenses.
An increasingly popular version of self-funding can be found in level-funded plans. Level funded plans have less risk than a self-funded plan, but offer some of the upside by sharing in the profits. They’re a nice middle ground between fully insured traditional plans and the self-funded plans mentioned here.
Take 2 minutes to discover how much you can
save with ThinkTank's custom solutions.
ThinkTank Insurance Partners, Inc.
18521 Spring Creek Rd Unit B.
Tinley Park, IL 60477
© 2020 ThinkTank Insurance Partners, Inc.