Should Businesses Self-Fund Insurance Benefits?

business people

Some businesses may consider self-funding insurance benefits a risky decision, but others view it as an opportunity to stem spiraling increases in health care costs.

While self-funded insurance plans are not a new concept, with the implementation of health care reform the interest in this option is growing. With self-funded plans, employees pay premiums and deductibles, and the employers cover all claims featured in their benefits. With medical insurance, many businesses purchase a stop-loss policy to protect their exposure to extensive risk.

In developing the plan design, employers conduct a health risk assessment to identify the needs of employees. They use this information to develop their self-funded benefit plan.  Businesses typically work with another partner, such as Ameritas Group, to administer the plan and handle claims. One of Ameritas Group’s areas of expertise is Administrative Services Only (ASO) dental and vision plans.

Read more about self-funded health insurance options by reviewing the article published by Benefits Selling Magazine. If you’d like to read some case studies about Ameritas Group’s administration expertise and commitment to customer service, visit our microsite.

If your business self-funds its insurance benefits, how does it work and what are the pros and cons of this option?