HR leaders will face big challenges in the year ahead — including, another year of rising health plan costs and worsening population health. To understand how HR plans to move forward and what support they’re receiving from insurers and plan administrators, Maestro...
What A Self-Funded Plan Looks Like
Choosing the right health plan model can be confusing (at best). When there are so many options out there and little information to help you understand the benefits available to you, it can be easy to just settle for the familiar fully insured option.
But let’s face it—a fully insured plan isn’t actually the safest or most cost-effective option out there. In fact, these plan designs are almost always more expensive when compared to a self-funded model. Your costs continue to rise, you’re stuck with their options and prices and you get little to no insight into what’s driving the plan costs.
A self-funded model means you can control costs and your plan design with strategies and solutions that fit your needs, not a big insurer’s profit margins—all without having to sacrifice benefits.
Here’s a look at the different health plan funding types out on the market today and why a self-funded model might work for you:
Fully insured plan.
This is what many people think of when they hear “insurance plan.” While fully insured plans are administered by national carriers, they’re built off of a one-size-fits-all model, lack a lot of transparency and pad in a lot of profit margins into fees.
Here’s what a fully insured model looks like:
- Access to the carrier’s national provider network.
- Locked into the carrier’s rates, rules, restrictions and fees.
- Fixed monthly premium, regardless of what your actual claim spend is.
- No access to your data or insight into your cost drivers that can cause employers (and their members) to end up paying more over time.
- Paying into big insurer’s profit margins rather than actual healthcare costs.
- No choice over vendors, like PBM or care management.
- Little customized support for member education or engagement.
Level-funded plan.
Level-funding is similar experience to a fully insured model, but the employer gains a bit more transparency and control over their costs. You have the familiarity of working with a national carrier, but more insight into what your cash flow and plan utilization looks like. A level-funded model is a great way for employers to get a feel for what self-funding could look like for them without having to dive in headfirst.
Here’s what a level-funded plan model looks like:
- Access to the carrier’s national provider network.
- Locked into the carrier’s rates, rules, restrictions and fees.
- Pay a fixed monthly claim premium up-front, but you get back any unused dollars (minus a service fee from the carrier).
- Access to some of your data (sometimes for an added fee) but it’s up to you to pull out insights, like plan utilization and cost drivers, and build reporting.
- Low or no choice over vendors and partners.
- Little customized support for member education or engagement.
Self-funding with a carrier.
Self-funding with a carrier gives you a lot more transparency, but at the cost of a higher administrative burden and customization. You have more insights into things like cost drivers and plan utilization, but you’re still stuck with what the carrier offers.
Here’s what self-funding with a carrier looks like:
- Access to the carrier’s national provider network.
- Locked into the rates, restrictions and fees of the carrier.
- Access to your data with some custom reporting available to you from the carrier.
- You only pay for the claims you incur and keep your plan savings.
- You’re only taxed on stop loss premiums.
- Low or no choice over vendors and partners.
- Some carriers will provide customizable member education and support materials, but a lot of the burden is still left to HR teams.
Self-funding with another TPA.
Working with an independent TPA means breaking free of the carrier and finding the right partner for you and your self-funded plan. You get more control, transparency and flexibility around all aspects of the plan, including vendors, plan language and your data.
Here’s what self-funding with a TPA looks like:
- Access to strong national and local provider networks.
- Access to your data and, depending on the TPA, custom reporting.
- You only pay for the claims you incur and keep your plan savings.
- Low administrative fees and, depending on the TPA, administrative support to ease the burden on HR.
- Only taxed on stop loss premiums.
- Plug-and-play with the vendors of your choice, including stop loss and PBM.
- Access to or ability to implement high-touch member support services, like advocacy, and member engagement support.
Self-funding with Maestro Health as your TPA.
Maestro Health’s self-funded solution is built around giving employers more transparency and control. Our people-focused approach to self-funded benefits is designed to provide more support for HR and plan members, arm you with your data and critical insights and truly manage costs—all while working with you as your partner.
Here’s a look at how we help administer better self-funded benefits:
- Access to a national carrier PPO network.
- Network solutions, like dual-option Cigna RBP-PPO plans and direct contracting.
- Repricing solutions built on methodologies that give you control and transparency over your healthcare costs.
- Access to your data and 26 detailed reports to help you understand plan utilization and cost drivers (at no extra charge).
- A dedicated client experience team to help you sort through that data and review key insights and plan recommendations.
- Plug-and-play with our long list of fully-vetted vendors, including stop loss and PBM.
- 100% plan savings stay with you.
- Low administrative fees and dedicated administrative support.
- In-house clinical care management team that includes certified case managers and health coaches.
- Mindful claims auditing approach to ensure you and your people are never paying more than you should.
- Custom member engagement to connect plan members with the resources and information they need to understand and use their plan.
At the end of the day, the right plan for you is really based on how much control and transparency you want. A self-funded plan breaks out of the one-size-fits-all carrier model and, with the right partner by your side, enables you to leverage that control and flexibility to design a plan around the needs of both your bottom line and your members.
Enough talk. Let us show you how we do self-funded plan administration for our clients. Check out our funding breakdown sheet.
