Stethoscope on healthform with blue pen

How Do You Get Transparency in the Healthcare World?

We posted a blog on the top 5 reasons you should consider a self-insured plan for your business. Now, We want to dig deeper into the first of those 5 reasons.

Reason #1: 100% Transparency in All Your Healthcare Dollars.

Currently in our heavy fully insured market, all clients send in a monthly payment to the insurance company in exchange for services provided to their employees to cover their healthcare needs. There is no breakdown of those monthly premiums and how much goes to each department or service provided. More importantly there is no breakdown at all on how much in claims your employee use! This is extremely important so that you can decide on how to manage your healthcare dollars for your employees. Wouldn’t it be helpful if you knew, for example, that your group was experiencing a high amount of ER visits? If you knew that you might be able to address it and take steps to minimize it.


In a self-insured plan you have 100% transparency on your costs. They are broken down into 3 categories:

  • Fixed costs (mostly administrative)
  • Reinsurance premiums (they protect you from the large claims)
  • Your claims fund (this is the account that your employee’s claims are paid from).

There are 3 items more than you would get from your health insurance company.


The fixed costs can be broken down even more. Within fixed costs you will usually see how much you pay for:

  • Administrator (the company that collects your premium and pays your employees claims)
  • Cost to lease a PPO network
  • Brokers cost (this is our fee to service and renew your account during the year),
  • Cost to audit your claims (this provides some very good savings),
  • Cost of Telemedicine
  • Other miscellaneous costs (PACE or wellness programs)


This is important data that you can use and make changes where necessary at renewal time. The example used above about the ER visits was based on a real experience. A company had 159 ER visits in one year! That was driving a sizable portion of their claims. To manage that, they decided to change the ER co-pay to $1000 per visit. However, if the insured did a video call visit with a Dr. first and that Dr. authorized the ER visit, they would waive the co-pay.

How did it work? They cut their ER visits by more than half the next year, AND they were able to get people over to see the doctor who had not been in a long time. That will eventually pay off as well if they catch a condition early.

This all works to help control costs. In a fully insured product in the small group market you have no ability to affect your rates. All rates are guaranteed, so any sort of measure you take to change the behavior of your employees, thereby controlling costs, has no impact. In a self-insured plan it all works.


Contact us to learn more.