Employee Health Plans: Fully Insure, Self-Insure or Maybe Somewhere In-between

Views on politics and (excess?) capitalism aside, the article Execs at Blue Cross parent reap big bonuses really struck a chord with me in terms of the conversations I’ve been having with my clients and prospects about their employee health insurance plans. This particular article focused on troubles in the individual health insurance market but the story for employer group plans is much the same; rising premium rates, higher deductibles and narrowing coverage options. Breaking out of the fully insured world to realize the flexibility and savings of a self-insured employee health plan can be daunting for mid-sized companies (50+ employees), afraid that one bad claim year will sap their liquidity and send them back to the big health insurers with their tail between their legs. Luckily, there are other options now available in-between the fully insured and self-insured spaces.

For years now, RCM&D has specialized in creating and managing group captive insurance programs that allow our clients to share their operating and business risks with other likeminded companies who prefer the rewards of proactive risk management vs. an often more costly, reactive mind set. By applying these same principals to employer group health plans we have been able to help our clients by identifying the root causes of claims activity, implement solutions to stem those claims and proactively keep losses, and therefore premiums, down. For times when even the most prudent cost containment strategies fail to prevent a large claim or bad luck takes its toll all in a given year, the risk sharing of the group captive insulates the organization from large losses they might be paying out in a self-insured program. And if you think your fully insured plan is currently protecting you from these losses, think again; you’re paying for it in your annual premium increases and the insurance company doesn’t share data with you (or profits in good years for that matter) so that you can take the necessary steps to reduce claims within your work force.

By exiting the fully insured space and evaluating your options for a group captive or self-insured employee health plan you are giving your organization the ability to share in profits that would otherwise go into the pockets of the big health insurance carriers and their executive bonuses. To learn more about these services and how they might benefit you and your employees, give me a ring today; 484-581-2813.