Are you aware of the self-funding health care options available for your company?
Many companies offer a fully insured health care option to their employees because it is any easy option of providing health care. As a more traditional choice, companies are required to pay a fixed premium to the insurance carrier for the year. From there, the carrier pays the claims for the company throughout the year.
The main downfall with fully insured health care is that companies pay the same rate no matter how many employee health care claims are processed throughout the year. This gives the upper management of a company a very hands-off approach to providing health care.
With self-funded health care, the company directly operates the health care plan they provide, not the insurance carrier. By breaking away from the traditional health care plan, companies can see more financial control, lower costs, and greater flexibility.
But does self-funding develop healthier companies?
When the employer takes insurance into their own hands, they hold a better understanding of the employees’ health through the processed claims. This in turn gives the company a good reason to care about the improvement of their employees’ health.
By implementing strategies to improve the overall health of employees, the employer develops a positive feedback system. In return, the company lowers the overall claims processed at the end of the year. In most cases, as the CFO gets to the year end, there is actually more liability recorded than needed because the risk manager was able to make the number of claims expensed better than expected. The money invested in insurance that is not used towards claims is then returned to the employer. The employer turns an otherwise 100% expense, into a possibility of a return in this way.
Are you looking to develop a healthier company, starting with the health of your employees? Start by offering self-funded health care option and implement programs that will encourage employees to get active and become healthy.
To learn more about all of the benefits associated with self-funded health care plans, read the article Self-Funded Health Care Plans Offer Great Benefits.