Self-Insuring, Why Bother

By Christopher Nunnally, LIA

Chris Nunnally is an Account Executive with Group Benefits Strategies.

Chris has been working in insurance and benefits his entire career. He was formerly the Director of Broker Sales for Teladoc. Prior to that, he was a Sales Representative for Sun Life Financial and New York Life where he gained extensive knowledge of Employee Benefits and Stop Loss Insurance.

Most employers have an understanding of what self-insuring their medical cost involves. But let’s take a look at why company self-funds. What does it mean for their employees? 3 out of 5 American workers are currently being covered by employer-based self-insured health plans. By 2020 nearly 35,000 companies will join the employers that already self-fund their health care cost.

Most employees have no idea they are covered by a self-insured plan. From the outside, a self-funded health plan looks like a traditional health plan. Weekly or bi-weekly deductions from their paychecks go towards health insurance premiums. They go to the doctor or pick up a prescription and pay a copay. For most employees, that is the extent of the interaction with their health insurance plan. However, a self-insured health plan can be so much more.

A self-funded health plan has the ability to be at its strongest when a member is at their most vulnerable. Self-insurance, when done correctly, is a living, breathing apparatus a company uses as a means to take care of their employees. A company has the ability to contract with vendors to help manage the most complex diseases empowering the insured to live a more independent, productive and happy life. For example, personal cancer case managers can help guide cancer patients to better outcomes. Telemedicine is a tool a single parent can use late at night for a sick child, and avoid having to pack up all their kids and drive to the emergency room. Employers can build a high performance health plan that meets the needs of their employees and fits with the culture of the company. A self-insured plan has the opportunity to empower its members to live happier healthier lives.

Members’ health and happiness and over-all well-being are why a company should consider self-funding their health care cost.

Mitigating cost is just the byproduct.

For more information on self-funding, contact GBS today.