Page 26 - 2020 Peel & Holland Benchmarking Survey Results

HEALTH PLAN FUNDING

INFORMATION PROVIDED BY THE KAISER FAMILY FOUNDATION

Fully-Insured Self-Funded

Under a fully-insured plan, an employer Many larger employers choose to
often feels less of the effects of rising pay for the health services of their
medical costs. Fully-insured plans employees directly from their own
are also convenient as claims are funds rather than by purchasing health
managed by the medical care provider insurance for them. This is called self-
and insurance carrier which allows funding. Self-funding is common among
Health employers to focus solely on their larger firms because they can spread
the risk of costly claims over a large
business.
Plan Totals RISK | In a fully-insured plan, the employer number of workers and dependents.
58.8%
21
Fully-Insured 41.2% pays a per-employee premium to an Many firms also use insurance, often
called stop-loss coverage, to limit their
Self-Insured 49.0% insurance carrier each year. If any claims liability for very large claims or an
25
51.0%
exceed the projections created at the start
5
90.2%
Level-Funded 9.8% of the year, the insurance carrier assumes unexpected level of expenses.
100.0% all legal and financial risk. Small employers RISK | The employer acts as its own insurer.
that offer heath benefits are typically fully- In the simplest form, the employer uses
insured. the money that it would have paid the
insurance carrier and instead directly pays
healthcare claims to providers. These plans
often contract with an insurance carrier or
other third party to administer the plan, but
the employer bears the risk associated with
offering health benefits.
9.8%
Partially
Self-Funded

41.2%

of employers surveyed have
a health plan that is

49.0% Fully-Insured
Self-Funded
National Trend

Sixty-one percent of covered employees,
including 17% of covered employees of small
employers (3-199 EEs) and 80% of large
employers (200+ EEs), are enrolled in plans that
are either partially or completely self-funded.
Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 2019

24 PEEL & HOLLAND | 2020 Western Kentucky Employee Benefits Benchmarking Survey Results