With Healthcare Reform changing the landscape of healthcare in this country, people are looking for new insurance plans, ideas, and solutions to the same problem that hasn’t changed because of Healthcare Reform: cost!
For small employers, there is a very limited number of good insurance plans available. While it is easier to get coverage, it is still getting increasingly expensive due to the guaranteed issue with no exclusions for pre-existing conditions. Employers trying to get a grip on the cost have looked to wellness plans to try and help. Unfortunately, in a world where rates are guaranteed, each employer group has no effect on their rates by implementing these programs. So why bother with a wellness plan if it cannot help with your costs? What can employers do to help their costs?
The only way to implement change to have an impact on your company’s healthcare costs is with a self-insured plan. Self-insured used to be only for the large employer market. However, now with the introduction of re-insurance, these plans can work down to groups of 20 employees, and even down to 5 in some cases.
These insurance plans are very advantageous for employers for the following 5 reasons:
100% Transparency in All Your Healthcare Dollars.
Have you ever wondered how much of your premium goes to pay Rx? Or how much is used on fixed costs within the insurance company? You cannot get that with a fully insured plan. However, a self-insured plan gives you that data. You will know how many dollars go to every part of your healthcare plan. From Rx to Tele Doc, to claims auditing and broker fees, it is all right there.
Most fully insured plans only audit about 20-30% of their claims. The rest just pass through for payment automatically. The administrator for your self-insured plan audits 70-80% of your claims and only passes 20-30% through for automatic payment. Errors happen all the time and your administrator can catch that and save you money. For example, duplicate billing, incorrect procedure codes, or even an error on the time someone received care at an urgent care center. All of those add up to an average of 8-10% savings.
Elimination of Healthcare Reform Taxes, Fees, and Compliance
The only way a company exempts from Healthcare Reform requirements is through self-insurance. Once self-insured, you can instantly save money on these items.
Insurance Company Profit Margin and Risk Adjustment are Eliminated
Since you are not using an insurance company you save on these 2 items immediately.
Get Money Back at the End of the Year
You will still pay a set premium to the administrator each month. If at the end of the plan year you had a low claims year and there is money left in your account….it is yours! You can take this out and do what you want or leave it in there which means you carry that forward into the next year, making that year even cheaper.
Discover Your Perfect Coverage With Integrated Insurance Solutions
These are just 5 of the pros for a self-insured plan as there are many others. With reinsurance covering the larger claims, we eliminate the risk for the small employer, and we now see these insurance plans coming down into the small employer market.
If you haven’t checked one out but have been curious, now is the time to look into one.