StarrWellnessToday I took the �rst step to a better me

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Insurance & Risk Solutions

5005 Loomis Road, Greenfield, WI 53220 Phone: (414) 421-3800 Fax: (414) 421-6145visit us at StarrGroup.com

Self-Funding vs. Fully-Insured PlansSelf-Funding vs. Fully-Insured Plans

FACTIn fully-insured plans, there is a “pooling point” which is the level of risk each contract assumes on a per claim basis. Over the past several years, carriers have increased these “pooling points” to levels where the employer assumes more and more experience under their contract. Example: A group of 50 may have a “pooling point” of $75,000, meaning their experience assumes all claims up to $75,000 in their experience, which is held against their renewal. In a self-funded plan, the employer can purchase a stop loss at $25,000,$30,000,$40,000 — sustantially reducing their risk per claim.

An employer can independently purchase a stop loss contact that is at a much lower point of risk than the fully -insured plan, thereby assuming much less risk.

Self-funding allows the employer to see all aspects, measure all aspects, and monitor all aspects of their health plans performance. Data is provided on a month to month basis so that the employer knows exactly what they are paying for each and every month. All fixed costs are disclosed, commissions are disclosed, and claims are all disclosed.

MYTH

1 For years and years, the market place has preached that self-

funding involves taking on much more risk than being fully-insured and is only for larger companies.

2 Fully-insured programs are “pooled” so that any bad

experience is not shouldered solely by the employer group.

3 Fully-insured programs through the carrier practice full

disclosure of their pricing, rating, and underwriting.

TRUTHToday, self-funded employers of all sizes can implement a stop loss or re-insurance contract that assumes much less risk than in their fully-insured plan. Additionally, Level Funded plans remove the risk of capital swings and allow for a significant retun of your money.

If the employer group contract has a “pooling point” that is significantly higher than the stop loss in a similar self-funded plan, the employer is assuming much more risk per claim toward their experience.

NOT TRUE. Once upon a time, carriers provided a document referred to as the “Renewal Underwriting Exhibit”, an accounting of the spend and cost under a fully insured program. Employers could see the claims utilization, the “pooling point”, administration charges, trends used to project claims experience over time, and how much of their rates were determined by experience and “pooling.” Carriers have become more resistant to providing employers with this accounting. Seldom, if ever, does an employer receive this for full disclosure.

Insurance & Risk Solutions

5005 Loomis Road, Greenfield, WI 53220 Phone: (414) 421-3800 Fax: (414) 421-6145visit us at StarrGroup.com

FACTSelf-funded plans provide in-depth monthly data and claims information down to the individual usage, by condition, by service, by provider and much more. Employers can rely on The Starr Group’s advanced analytics to the data to customize and build their health plan to fit their employees and their population at risk.

Ask yourself, when was the last time you received a report advising how much money YOU—as the employer—saved by putting in the wellness program? As the employer, if you implement a wellness program under a self-funded program the entire savings and cost impact of the plan saves you money directly because it reduces your claim fund.

For self-funded companies, The Starr Group has underwiting, financial analysis and analytical tools that most agencies do not have or can provide. We also have tools to help employers analyze and understand their ACA compliance risks. Our Financial Analysis tool keeps employers apprised on a month to month basis as to the financial performance of their plan. Our trend analysis tool keeps the employer apprised on a month to month basis as to the performance of their health plan and how it is trending. The Starr Group assigns a service manager to each group who services their group on a daily basis. Yes, we even accept calls from employees who need assistance.

TRUTHCarriers are becoming more resistant to providing full and in-depth data that allows employers to really analyze the performance of their health plan. When the carriers does provide data and the employer wants to “customize” the plan, the reply is “the plan is the plan. Now if you want to go to a totally different plan, we can do that.”

When you’re fully-insured, the primary recipient of the benefits from implementing a wellness program is the insurance carrier. The wellness program in a self-funded plan, saves you—the employer—money directly through claim reduction.

NOT TRUE. The Starr Group applies the most advanced analytical benefit tools, taking the guess work out of decision-making.

MYTH

4 Fully-insured programs allow the employer to manage their plan

through product changes based on the data provided.

5 Fully-insured carriers are selling and emphazing placing wellness

programs in their health product lines. Some even discount their ratings for doing so saying it will benefit the employer cost and experience.

6 All agencies are the same when it comes to servicing health plans.

Our vision is to lead in the creation and delivery of Risk Reducing Services and Insurance Programs for our clients, improving their Total Risk Wellness.

Self-Funding vs. Fully-Insured PlansSelf-Funding vs. Fully-Insured Plans