This question should be explored with the help of a specialist in health plan design. Factors to be considered in evaluating whether a self-funded plan meets a specific company’s objectives and fulfills the needs of its employees include the following:
- Current and projected healthcare cost trends.
- The company’s healthcare claims history.
- The company’s projected future claims.
- Makeup of the company’s workforce.
- The projected cost of plan management and administration.
- Availability of stop loss coverage.
- Financial risk tolerance.
An experienced plan design specialist also can help a company explore the potential benefits of developing a health benefits program with multiple plan options (including CDHPs and traditional provider network plans) and assist in obtaining stop loss coverage.
Self-funding as a long-term solution
Companies continue to experience annual increases in healthcare costs, with no end in sight. With healthcare reform regulations and the impact ACA has on the cost of insurance, now is the time to consider a different method of funding.
Self-funding may be a lifeline, connecting small, mid-sized and large employers to valuable opportunities for increased cost control and improved cash flow. Additionally, the flexibility of self-funding allows for the development of comprehensive health benefit programs with options matching the needs of employees from diverse backgrounds and lifestyles.