Self-Insurance can cut costs
If the claim costs exceed the premium amounts collected from the employer, the carrier pays the difference.
More and more employers are reducing their health insurance costs by turning to self-insured plans.
Under a self-insured arrangement, the employer incurs the expenses for treatment costs and medical claims.
The employer pays a specific amount to the insurance carrier to act as the claims administrator, process the employees' claims and manage the benefit plans.
By not asking someone else to assume the health insurance risk, a self-insured plan typically lowers the overall program costs.
Self-insured plans typically work best for employers with at least 500 employees, because the larger employee population enables the employer and carrier more accurately to predict the expected claim costs.
A large organization also can make the most use of the cash flow advantages created through self-insurance.
To self-insure, employers should find a health insurance carrier that can provide administrative support to a wide variety of health care plans and innovations, including health savings accounts, health reimbursement accounts, out-of-network options, preventive care and wellness programs.
The carrier also should be able to provide fast and accurate claims processing, courteous service, periodic claim activity reviews and coordination of benefits when a spouse or significant other has other health-care coverage.
Business workshop is a weekly feature from local experts offering tidbits on matters affecting business. Stephanie Bernaciak-Massaro United Healthcare svbernaciak@uhc.com
Copyright 2008 P.G. Publishing Co.
