Have you ever wondered if self-funding for health insurance could be a good fit for your business? Evaluating this option can seem daunting, but asking yourself these four questions can help you decide whether self-funding might be a beneficial route to explore.
1. Do You Have a Large Enough Base of Employees?
One of the first considerations is the size of your workforce. Generally, having at least 25 employees on the benefits plan is recommended. With a larger group, you can spread the risk more effectively, leading to greater stability in your claims experience. This risk distribution is crucial for maintaining a balanced and predictable benefits cost structure.
2. Do You Want More Ownership and Control Over Benefits Plans and Design?
Moving to a self-funded model gives you significantly more control over the design and management of your benefits plans. This flexibility allows you to tailor the plans to meet your organization’s specific goals, whether that’s cost containment, long-term strategy, or employee retention. You’ll have the ability to adjust various elements of the plan to better align with your company’s needs and objectives.
3. Are You Satisfied with the Analytics and Data You Currently Have Access To?
A key benefit of self-funded plans is enhanced access to detailed reporting and analytics. This increased data visibility allows you to make more informed and strategic decisions regarding your benefits offerings. With comprehensive data, you can better evaluate your plan’s performance at each renewal and develop a more effective long-term strategy.
4. Is Wellness Part of Your Company Culture?
If wellness is already a significant aspect of your company culture, or if you want it to be, self-funding could be a strong fit. Self-funded plans provide greater incentives to invest in employee wellness initiatives. From wellness fairs and participation challenges to biometric screenings, you can implement programs that promote a healthier workforce, potentially reducing overall healthcare costs in the long run.
Conclusion
Self-funding can seem like an intimidating option, especially if you’re unsure whether your business is the right size or where to start. However, if the questions above resonate with your situation, self-funding might be a beneficial approach for your organization. We would love to discuss how this could work for you and help guide you through the process.