Top 10 Benefits of a Captive

Finance executives (CFOs) are increasingly looking for greater value in their health benefits plans. This includes reduced risk, lower costs, and increased predictability which are all factors critical in strategic planning and budgeting. 

The latest research conducted by ParetoHealth and Industry Dive shows that “the cost-benefit equation that underlies the analysis of healthcare benefit plans is complex.”

To ensure that CFOs are within budget and providing the best healthcare plans possible for their employees, they have explored the option of using a captive. 

“A captive is a group of employers who share the same business goal of reducing costs, but not the quality of their employee health programs. As a captive member, an employer has better purchasing power. So instead of being an employer that has a hundred employees, as a captive member, you’re now an employer that has 5,000 employees. As a result, you can get better health benefit programs for your dollar,” explained Andrew Cavenagh, CEO of ParetoHealth

In fact, a captive addresses most CFOs’ concerns around health benefits management. Here are the top ten benefits of a captive:

  1. Decrease risk and healthcare spending by paying claims as they are incurred instead of a fixed, fully-insured rate, that rises year over year.
  2. Greater transparency and improved data on actual claims cost and utilization. 
  3. No new lasers for members.
  4. Unparalleled protection with renewals consistently below industry averages. 
  5. Increased flexibility with plan designs, administration, and offered services, so employers can better support employees and spend wisely. 
  6. Stronger stop-loss protection.
  7. Access to and assistance with an integrated cost management platform. 
  8. Members are rewarded with good experience.
  9. Seamless transition from a fully-insured model to a captive model for employees, with human resources and finance departments managing administrative changes on the backend.
  10. Elimination of the surprise of premium increases— helps CFOs smooth forecasting and plan budgets.

If you want to transform your employee health benefits, captives are an option. Captives can provide lower risk, and reduced cost, all while ensuring employees receive great health care. 

For more resources on how to improve your health care plans, take a look at our ‘How to Think About Benefits Differently’ white paper here.

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