UBP blog

07/15/2009

Had it up to here with double-digit rate increases? Partial self-funding could be your solution.

On July 1, 2009, a new plan design—the partially self-funded plan—became available in Massachusetts. This plan design saves small and mid-size firms anywhere from 5-50% in group healthcare costs and alleviates a couple of the biggest pains associated with traditional fully-funded health insurance.

Pain #1: Small employers with 50 employees or less have been getting double-digit rate increases because they are in the same claims pool.

Solution: Get out of the pool and into your own.

Partial self-funding lets groups get out of the claims pool with everyone else and into their own pools. Also, with the new partially self-funded plans, employers have access to employee health data to help them best assume financial risk for funding health benefits.

Pain #2: Fully-funded health plans look like “all-you-can eat healthcare buffets”. You pay one price and it’s all the healthcare you can use. This isn’t the most cost-effective way to design a health benefit plan.

Solution: Design your own plan that’s not “all-you-can eat healthcare”. Instead, your plan will be “all that you need healthcare.”

With partial self-funding, employers have access to employee claims data every month as well as employee health data. This is what helps them to custom design an “all that you need” plan.

Two carriers in Massachusetts have begun to sell partially self-funded plans as of 7/1/09 and all of these plans meet the state’s minimum credible coverage (MCC) requirements.

We’d love the opportunity to discuss these plans with your company and see what we can save you, so give us a call at 617-859-1777 so we can get a conversation started.

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