How to Know If You’re a Candidate For Self-Funding
Finding a health plan that is suitable for your business and employees is tough. Looking at all your options, including alternative options, is a good way to see what works for your business and what does not. There are many alternatives, such as self-funding, that might be a great fit for your future health plan route.
Self-funded health plans are when the employer takes on the financial risk of providing health benefits to their employees. Self-funded plans can be a cost-effective option for some employers, but it’s important to carefully consider whether this is right for your business or not.
How do you know if you are a candidate for self-funding?
You are considering making the switch to self-funded health plans, but you don’t know if you are the right candidate. Below are a few indicators to see if you qualify for self-funding or not.
- Your company has more than 50 employees.
In the past, self-funding was only an option for big companies. However, that is not accurate anymore and there are many programs out there with self-funded plans. Many carriers have created a model where the scalability to go self-funded doesn’t have to be thousands and thousands of employees anymore. So, if your company has 50 or more employees, it’s actually a great opportunity to evaluate to see if it’s a good fit for you.
- You want increased control over risk.
The term “self-funded” can sound intimidating. However, the truth is you do have reinsurance behind the scenes to protect you from any catastrophic claims. While fully-insured groups transfer risk entirely to a carrier, they miss opportunities for significant savings. With self-funded plans, instead of simply transferring risk, employers are proactively managing it.
- You want to create a health plan that works best for your company.
Due to the nature of how self-funded plans are designed, employers can create health solutions that work best for their employees. This reduces overall claims expenses, and they can also choose providers, become part of a proprietary network, and put their employees in a position to make smarter consumer choices. Self-funded plans allow you to have better control over your plan and your costs.
Want to learn more about if you are a potential candidate for self-funding or not?
Take the 5-minute questionnaire to find out if self-funding is an option for you.