Insurance & Employee Benefits
As a mid-
The renewal letter has arrived delivering with it notice of a double-
Carrier’s retort is all too familiar – poor industry experience, increased taxes and other expenses have left them no choice but to raise across the board
Immediate response is “I should just self-
The fact is that most brokers have repeatedly steered employers away from self-
This article offers a brief overview on self-
A traditional health plan is a pure risk transfer plan. The group pays fixed premium monthly to the insurance carrier and the insurance carrier is then responsible for all claim payments – with exception of any cost sharing obligations levied to the insured – and all administrative services. The insurance carrier is also the risk taker on the policy and any unused premium dollars is retained by the insurer as profits.
In a self-
Most employers are not in the business of medical administration. Rather than trying to develop expertise in these areas, they partner with a qualified Third Party Administrator (“TPA”). The TPA is paid a monthly fee per employee and the TPA works closely with the employer to handle the following services that enable the self-
Specific: This provides coverage when the total claim amount for a claimant exceeds the specific (“spec”) deductible. This scenario is similar to traditional insurance policies where the carrier pays claims in excess of the deductible. However, unlike other lines of insurance, this deductible is per claimant and not per claim. Therefore, multiple claims on a member combine to reach the attachment point after which stop-
Aggregate: Aggregate (“agg.”) coverage pays all claims for the group once the total claims for the group exceed the aggregate attachment point. The aggregate attachment point is calculated by the insurer to be approximately 125% of expected annual claims for the entire group. While Specific coverage is purchased to protect against catastrophic claim experience from an individual, aggregate coverage is purchased to protect against catastrophic experience at the group level.
Terms of Coverage: Stop-
There are a number of advantages that a self-
To obtain the answer to that question, you should be able to identify the status of the issues below: