Level Funded Insurance Plans

When healthcare reform became law, and with the launch of ACA compliant plans, carriers have created plans that are customizable and could significantly reduce your health premium. These new options are Level-funded health programs, and top carriers such as United Healthcare, Blue Cross Blue Shield, Humana and Aetna have plans available in Illinois.

Level-funded health insurance plans are a hybrid of traditional fully insured plans and self-funded plans. Level-funded plans have the same look and feel of traditional small group health plans, yet offer the advantages and savings of self-funded benefit programs.

At H Group Benefits, we saw the value of Level-funded plans right when they first hit the market. We sold one of the first level funded plans with Blue Cross Blue Shield in Illinois. In most cases, we find we’re able to save our clients 30% or more on their health insurance premiums without sacrificing coverage or raising deductibles. In fact, much of the time Level-funded plans can save you money and lower your deductible at the same time.

Just like your current health plan, Level-funded plans feature fixed monthly payments with simple plan design options. Unlike self-funded plans, Level-funded plans are not subject to state premium taxes and offer easy administration.

The fixed monthly payments of a Level-funded plan include stop-loss insurance and do not fluctuate based on claims activity. This means there are no extra charges if claims are high, so employers will never have to pay more than the maximum monthly cost. While self-funded health plans are often criticized for the employer’s potential to lose money, a Level-funded plan eliminates this risk.

Companies interested in Level-funded plans are required to have at least 5 employees enrolled on their benefits up to a max of 100 employees.

Here are a few reasons to consider to a Level-funded health insurance plan for your small business:

  • You have greater control over your health care dollars, year after year, because your costs are based on your employees
  • Your health care costs are much lower than those of a traditional, fully-insured health plan, and are not required to bundle in state-mandated benefits
  • You are refunded money at the end of the year if your claims do not exceed projections

One reason not to consider a Level-funded insurance plan is if you have high claims volume currently. High claims volume could disqualify your company from participation in the plan or you could risk an increased renewal rate.

 With many insurance carriers offering Level-fund health insurance plans, our clients have more and more choices. You can, too. Please contact us to learn more about these plans and see if they make sense for your company.