Advantages of Self-Funding
As the cost of health insurance continues to climb, employers are looking for alternatives:
- Self-funding offers employers a powerful, practical alternative to traditional insurance that allows them to reap the benefits of larger employers.
- Self-funding rewards employers for good claims experience in a way that makes sense for smaller businesses.
- Self-funding with stop-loss coverage protects employers from unusually high claims experience.
Cost Components of Fully-Insured vs. Self-Funded Health Plan
Fully Insured = The insurance company assumes all the risk.
Self-Funded = The employer assumes some of the risk.