Unwrapping The Myths and Misinformation About Partially Self-Funded Health Plans

The preponderance of myth, misinformation and outright lies about self-funded health plans is unnecessarily hurting employers’, employees’ budgets and benefits. Before the next renewal learn the facts, investigate the savings and take back control!

1

My company isn’t big enough for self-funding.

That may not be the case! We ordinarily write health plans and total benefit packages for 50 employees or more.

2

Self-funding is hard to understand.

It may seem that way at first, because for the first time you’re getting a transparent look into the elements of your health plan that are usually wrapped up and hidden in traditional insurance. In reality, you’ll finally be able to see – and therefore control – what you’ve been paying for in fully insured plans; claims, catastrophic insurance protection and a small administrative fee are all unbundled. And don’t forget that MBA is more than happy to answer any question you have at any time!

3

“Self-funding” the same as “self-insured”, where employers are financially responsible for everything.

Sometimes the terms get interchanged incorrectly. “Self-insured” plans are for only those employers who are large enough for it to be financially beneficial to pay for all claims, and forego buying any insurance. “Self-funded” or “partially self-funded” health plans are a combination of employer-paid claims and low-cost catastrophic insurance to protect them from a claim that crosses pre-determined limits. The combination makes partially self-funded plans less expensive than traditional, fully insured plans.

4

Employers have no protection from large claims, and these could break the bank.

With self-funded plans you actually have two safeguards from high claims; 1) A maximum, or “stop loss” for individual claims called your “specific”, and 2) an “aggregate” stop loss that limits employer responsibility for claims for the total group. The limits of both are pre-determined and balanced for the number of people covered, your comfort level and are calculated for the most savings possible.

5

Self-funding doesn’t help employers in the long run. Renewals are high and soon I’ll be right back to a fully insured plan.

Most of our clients have actually enjoyed just the opposite; initial savings and flat renewals are why many stay with us for an average of 12 years! This is made possible by our multiple claims management strategies and our ability to “shop” your catastrophic insurance with multiple carriers. Unpredictable renewals are not in our vocabulary!

6

My current carrier offers PPO and HMO options which provide discounts on claims, thereby giving me big-group buying power I can’t get elsewhere.

We too can offer PPO and HMO options, but don’t be fooled by “discounts” and “in-network” vs “out-of-network” charges which are supposed to save money. In many cases the claims or charges are not called into question…they are just discounted.

  • Do you really want to pay for a circumcision – on a female?
  • Is 30% off a charge that is 10x’s too high still a good deal?

Our approach to claims management is totally different. Our process looks at each facility claim through partnerships with ELAP and AMPS. Excessive charges are repriced and negotiated for you to a reasonable price and fraudulent claims are rejected, saving you vastly more in the long run. It’s your money – Let us provide your buying power!

7

For my employees who are scattered in several states and locations, using multiple fully insured plans is the only way to cover them all.

Actually, with self-funded plans you can have all of your employees covered under one umbrella. Self-funded plans fall under the federal law, ERISA. This bypasses state-based insurance commissions and regulations, allowing you to avoid duplicate administrative costs and immense hassles. All-in-one is cheaper and easier!

8

I’ll never know what my costs will be with a self-funded plan.

That is absolutely not true. You will always know what your maximum costs will be; you just won’t immediately know how much you will save off of that maximum figure!

Self-funded maximum plan costs are basically made up of three things:

  1. Your budgeted maximum amount for claims per person and for the entire group,
  2. A greatly reduced insurance premium for coverage over your budgeted claims maximum, and…
  3. A small administrative fee.
  4. The total of all three is your maximum liability for the year.

    But your actual claims experience will likely be below the budgeted amount…and the money you don’t spend is money you keep! That’s why we can say, “You will know your maximum costs…you just won’t immediately know how much you’ll save!”

When the truth regarding self-funded plans is uncovered, you can see that they are not so frightening, expensive or complicated…and they are definitely not unpredictable. Our clients are:

  • Claiming control of employee health benefit costs and benefits,
  • Saving an average of up to 25% in the first year, and
  • Often enjoying flat renewals thereafter!

Eliminate the myth which says there is nothing you can do about high rates and exorbitant renewals. Learn more about how self-funding can specifically benefit you!

Learn More about Self-Funding and How it can Benefit You



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The Open Solution Founder Phyllis Merrill

 

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We're neighbors you can talk to...
Where else can you get a direct line to a claims adjudicator, plan manager or even the President of the company? Only at MBA Benefit Administrators. We’re the big third party administrator for health plans with personal service that you can only wish others would provide. Like talking to a friend over a fence, we have that neighborly feel…but we provide world class advantages.
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…and we prove real solutions do exist for escalating healthcare costs.
We’ve received national kudos for our multiple, proven strategies which reduce claims and plan costs without harmful benefit reductions for our clients’ employees. Proof of MBA’s effectiveness in this is in the numbers. Our clients see:

  • An immediate average reduction of up to 25% in maximum health plan costs the first year,
  • Flat renewals after that, and because of this and our commitment to impeccable service…
  • Our clients remain with us an average of 12 years…an unheard of accomplishment in the health insurance industry.
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With “outside the box” flexibility in health plan administration…
Since 1987 MBA Benefit Administrators has successfully served large and small employers, public entities, associations, tribal nations, school districts, non-profit organizations and insurers. We have the capability to administer anything from single-plan 25-life groups to complex employee organizations with multiple medical, dental and vision benefits or employees in multiple states. We also provide a wide array of ancillary services such as COBRA and HIPAA administration and HSAs. When you discover:

  • The depth of our experience
  • The flexibility we offer in benefit design
  • Our commitment to technology to make your life easier
  • Our can-do attitude toward service

 

…we’re confident you too will see why MBA is a national leader in third party administrative healthcare benefits.

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…and state-of-the-art technology for painless administration and integration of services, we make your life easier.
No one thinks about making your life easier and more efficient than MBA Benefit Administrators. Our technological investments are totally integrated across services so that employees and employers – with HIPAA-compliant and appropriate need-to-know safeguards – can view at a glance their standing for benefits, claims, plan reporting and other services. These advancements provide:

A Comprehensive On-Line Enrollment Wizard: Employee self-enrollment or HR department enrollment methods, including ancillary program enrollments and billings.

HR On-line Capabilities: View, adjust and approve on-line employee eligibilities; check claims status, print reports and plan documents all from one place.

Multiple Employee Access Channels: Employees can view on-line their claims status, eligibility and account balances of reimbursement plans such as HRA, HSA, Flex and Executive Reimbursement plans. In addition, we offer all employees our MBA App, where they can:

  • Carry a virtual ID card,
  • Check on the status of a claim,
  • Submit secure documentation to MBA,
  • Contact our support team,
  • …and more!

On-line Document Management: In one place view specific documents such as:

  • Plan Documents
  • Temporary ID Cards, and
  • Employee Communications and Forms

HSA Services Integration: MBA seamlessly integrates HSA plans with HealthEquity Services. Claims information is electronically transferred from MBA’s claims system to HealthEquity employee accounts. There is no need for paper claim filing or second-guessing the eligibility of expenses. Even employee eligibility is updated through MBA data feeds.

HRA Reimbursement Plans: MBA’s administration processes allow clients and their participants to rely on accurate and timely processing of reimbursements. Eligibility, billing and remittance of claims, integrated scanning and storage allow for real-time remote access.

Section 125 Flexible Spending Plans: MBA Benefit Administrators coordinates with employers to offer Section 125 Flexible Spending administration and help employees save money on medical expenses. Providing this benefit for your employees is like getting a 30% discount on Medical Premiums, uncovered medical expenses and dependent care.

COBRA Administration: MBA Benefit Administrators can handle all of your COBRA requirements. We will mail and track notifications, coordinate COBRA payments, receipts and reporting and ensure claims match “paid through” dates, plus give you on-line access to all activities.

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At MBA employers are cared for too…
MBA goes the extra mile to ensure that as an employer your health plan does not complicate your life. We give you things like:

  • Business intelligence for advanced reporting and critical analysis of your plan’s performance, costs, payouts, claims analysis and large claims submitted for insurance.
  • Billing and Funding services integrated with enrollment, customized to your specifications and handled electronically.
  • Account balancing systems produce cost accounting reports and perform bank reconciliation activities, available for review at any time.
  • And the ability to review multiple reports regarding your plan; check registers, active employee reports, YTD recaps, claims reviews and lots more.

…with powerful health care and claims management systems to save them money.

We believe your investment in a health plan should be treated like any other aspect of your business, with upfront knowledge of the costs and all attempts to weed out waste. MBA saves employers more than nickels and dimes with many methods of management, including:

Metrics Based Pricing: Why rejoice over a 30% discount on a claim that is 1000% too high? Metrics Based Pricing reduces claims to a “cost of service + reasonable margin” level by auditing claims for unfair markups and inaccurate or fraudulent billing. This results in an average $1500 per employee savings – AND WE DO IT WITHOUT RESTRICTIVE NETWORKS!

Medical Management Services: Proven to reduce hospital admissions and the average length of stay.

HealthSteps™: Wellness plans and initiatives that do make a difference in the overall health of your workforce and drive down health claims.

Prescription Benefit Management: With an average reduction of 9.4%.

Internet Prescription Bidding: Allowing employees to save up to 87%.

Actuarial Projecting: The projection of benefit costs and savings is one of our underwriting core competencies. Go ahead – suggest benefit changes, add or drop a plan component, change eligibility: MBA will accurately determine the financial impact on the plan and offer suggestions to tweak the benefits to suit your objectives. We offer the facts then you call the shots.

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