Currently, 72% of American companies are covered under self-funded health insurance plans. That’s 92 million American workers, with more switching every year.
Is a self-funded health plan administered by MagnaCare right for you?
The traditional model
Companies hire health insurance companies to provide fully insured healthcare for their employees. But companies have little control over the healthcare benefits provided or any ability to halt rising premiums. According to a 2020 Kaiser Family Foundation report, the average premium for employer-sponsored family health coverage increased 22% over the past 5 years and 54% over the past 10 years.
A self-insured health plan is one in which your company assumes responsibility for providing healthcare benefits to your employees. Your company sets up a fund for your employees’ healthcare claims and hires a third party administrator (TPA) like MagnaCare to administer it.
Self-funded plans reduce your overall costs, immediately saving you 2 to 3% on the cost of the plan, with the potential to save far more. Self-funded plans are also preempted by ERISA from paying state mandate costs.
You save money when eligible medical claims for a year do not exceed your plan’s predetermined limit.
With a self-funded insurance plan, your company can keep those dollars to offset the subsequent year’s funding.
Under a fully insured plan:
- Premiums evaluated each year (increases are very likely)
- No plan design flexibility
- Limited cost containment or ability to reduce claims costs through benefit design (e.g., member navigation strategies)
Under a self-funded plan:
- Individual and aggregate stop-loss protection
- Flexible plan designs
- Cost containment strategies and member navigation programs to lower claims cost
Cost savings are not the only benefit
as your employees incur them, giving you more control over cash reserves and maximizing your interest income.
Third Party Administrators work for you
TPAs like MagnaCare work with the help of their actuaries to assist you in determining the level of coverage you need. Unlike traditional insurance companies, they don’t drop or reject claims or make arbitrary plan changes. It’s in their best interest to clear up red tape—a chief employee complaint about traditional insurance—rather than create it.
Providing exceptional value, experience and flexibility, MagnaCare leads the way in controlling health care costs and shaping benefits for companies across the nation.
Our healthcare actuaries will help you determine the level of coverage you require
We’ll assist you in designing a plan tailored to your employees’ needs
You’ll enjoy the transparency of full access to claims data
We’ll approve eligible claims, decide appeals, and handle other time-consuming administrative tasks
Our administrative costs are usually lower than those charged by insurance carriers
- You’ll have access to proven cost containment strategies (such as benefit tiering, member navigation programs, and reference-based pricing) to lower claims costs