Self Funding 101

Small business (fewer than 300 employees), have increasingly become more and more disadvantaged to the larger employers – particularly in health insurance. Why? Almost 90% of large employer’s self fund their health insurance. Previously, there was no way to balance the scales. We’re here to change that through self insurance for small business. How do we do it? Click the "hot spots" to learn more.

Why do large companies self fund their health insurance? The #1 reason is cost savings. Self funding will create a 8 - 18 percent savings differential, every year, over traditional carrier-insured coverage.

A well-structured, self funded health insurance program is safe and offers cost savings especially beneficial for small businesses. While self funding isn’t for every business, it does save money for those which are good candidates.

Prescription drugs often put a strain on traditional health insurance coverage. Self funded insurance offers the following benefits. First, we provide direct access to the manufacturer. Our pharmacy program includes invoking every means to gather discount coupons or, even more importantly, discounts for high-cost drugs. Second, our pharmacy plan is designed to encourage direct-to-the-manufacturer savings, meaning that you save money and the plan is more efficient and cost effective.

In self funding, there’s strength in numbers. To create the safest environment for self funding, we incorporate the following protections. First, we bring together a number of similar, successful small businesses and create our own risk pool, so a large claim won’t overwhelm the program. Second, we buy "Stop Loss" insurance to cover the pool of companies, ensuring that larger claims are handled by wholesale ‘reinsurance’ companies - just like the large employers do.

With the traditional health insurance model (focused on carrier profits), the insurance company always knows more than you do. How do you negotiate against that? We’re changing that. First, in a self funded program, information is truly transparent. You can completely analyze your spend. Second, insurance profits are your savings - money in the bank – your bank!