More employers are opting to self-insure their employee benefits in order to gain more flexibility and control in plan design and financing. A well-designed self-insured plan enables companies to reap the benefits of their cost containment efforts and wellness activities, rather than having to pay a monthly premium to a commercial insurer based on an arbitrary set of rating restrictions.
Level-funding is a self-insurance hybrid program which further enables companies to benefit from the regular and predictable cost of a fully insured plan, while only paying for the healthcare costs actually incurred by employees. This approach can potentially provide a 30 to 40 percent annual refund on health benefit costs.
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