Self/Level-Funding has been around for many years and a majority of large employers have found that it is the most cost effective way to provide employee benefits to their employees. Since 2010, many insurers offer risk transfer products for smaller employers, thus enabling them to take advantage of the benefits of self funding without assuming a huge financial risk. In most cases, smaller employers are able to budget the same costs under self funding that they would have paid had they remained fully insured except now they get money back when they have lower claims!
Advantages of Level-Funded Plans
- Set monthly payments
- Limited liability through stop-loss insurance
- Stop-loss advancements
- Retain unused claim funds
- Long-term savings
- Tax Savings
About your proposed rates…
The rates provided are contingent rates subject to underwriting review and/or approval. Rates quoted include a rate load to offset potential medical issues found during the underwriting process.
Underwriting process…
Depending on the carrier(s) quoted, the carrier may offer one or more of the following underwriting methods:
- Paper Application
- Online Application
- Telephonic Interview
Rate Calculation?
The carrier(s) will look at the conditions of the employees to determine which conditions are considered to be “ongoing” into the next plan year. They then only use those conditions that are anticipated to generate claims to determine how much is anticipated to exceed the average daily claim usage
Carrier: Carrier A Carrier B
Plan:
Traditional PPO CDHP Plan
Deductible**: $5,000 $5,000
Out-of-Pocket Max**: $5,000 $5,000
Member Co-Insurance: 20% 20%
Primary Care Office Visits: $25 deductible/coinsurance
Teledoc Benefit: $25 $40
Urgent Care: $40 deductible/coinsurance
Emergency Room: deductible/coinsurance deductible/coinsurance
Hospitalization: deductible/coinsurance deductible/coinsurance
Outpatient Surgery: deductible/coinsurance deductible/coinsurance
Labs & X-Rays: deductible/coinsurance deductible/coinsurance
Rx Deductible: $150 n/a
Prescription Benefit: $15/$45/$75 deductible/coinsurance
Rate Summarization
| Number of Units | Rate Type | Fully Insured Renewal Rates | Level-Funded PPO Plan | Level-Funded CDHP Plan |
|---|---|---|---|---|
| 107 | Employee: | $525.15 | $494.73 | $435.55 |
| 42 | Dependent: | $777.22 | $732.07 | $646.72 |
| Monthly Premium: | $88,834.37 | $83,682.93 | $73,766.07 | |
| Annual Premium: | $1,066,012.49 | $1,004,195.16 | $885,192.84 | |
| Gross Annual Savings: | $61,817.33 | $180,819.65 | ||
| Plus - projected claims fund refund: | $69,645.00 | $58,802.28 | ||
| Projected Net Annual Savings: | $131,462.33 | $239,621.93 | ||
Self-Funding
| CARRIER | PLAN | SIZE | COMMISSION |
|---|---|---|---|
| Benefit Advantage | Partial Self-Funding Administrator | 30-50+ | $10 per employee/negotiable |
| Sun Life/Assurant | Partial Self-Funding Administrator | 30-50+ | varies |
| Protect Plans | Partial Self-Funding Administrator | 30-50+ | 5% on new and renewing business |
| Employer Driven Insurance Services | Partial Self-Funding Administrator | Varies | Varies |
Contact your Dickerson Sales Rep today. (877) 361-7342
email: sheplerfear@dickerson-group.com