Transcript
Page 1: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program

Private Club Health Care Captive

Self-Funded Group Stop Loss Captive Program

Page 2: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program

PresentersRick LadendorfPresident and Founder of Prevo Health Solutions

Contributing writer to the BoardRoom magazine, Executive producer of the CEO WELLNESS PLEDGE & the AMERICA'S HEALTHIEST CLUBS wellness rating system

Ben KrambeckManaging Partner Benefit Captive RE

Ben has 15 years experience in the Insurance Industry with a focus on self-funding alternatives for mid-size employers. Ben is a speaker and has published numerous articles regarding HealthCare Reform ACA legislation and Self-Funded Medical Stop Loss Captive programs.

Darrell FryerManaging Partner Prevo Insure

Darrell Fryer has 19 years experience as a business owner/agency with employee benefits, Medicare, long-term care, life, auto and homeowners

insurance for individuals and business owners throughout California.

Page 3: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program

Today’s ObjectivesControlling Health Care Costs through Self-Insurance.

• An overview of self-funding health benefits• The structure and workings of self-funded plans• Self-funded plans costs and administration• Advantages & disadvantages of self-funding• Qualification criteria to join the Private Club Captive • Health reform and how that impacts self-funding plans• Stop-loss Insurance to handle catastrophic claims• Next Steps in moving forward• Q&A

Page 4: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program

Fully Insured Model is Broken• Clubs surrender all control of one

of their highest expenditures to an insurance company

• Canned programs (plan designs, managed care, HMO)

• Claims and data not accessible for analysis from carriers

• No transparency or auditing abilityo Insurance companies bill at

maximum code price possible. Often for procedures that never take place. No bundled pricing.

• Premiums up 13% in last 10 years• Cost shifting rather than solving• Can’t manage health without

knowing what your employees need help with.

Page 5: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program

The Ugly Unsustainable Truth

Page 6: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program

Health Premiums in 10 Years

Page 7: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program

• Most companies run a routine bidding process among insurers every year or two and then take the best deal offered by their agent. This is a shallow exercise that more often than not, does little to change the practices of providers. Year in, year out, it’s business as usual. CEO’s and CFO’s need to grab the non-system by the scruff of the neck and shake it up. One Company fires the employee in the probation period if they don’t stop smoking!

• 57% of all employees are insured through self-insured employers. Self-Insured Institute of America. 83% of employers over 200 employers.

Page 8: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program

Be the Club That Solved Health Care

Page 9: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program

Advantages of Self-Funding a Plan• Savings 25-30% first year and with a wellness plan, even

greater• Exempt from premium taxes in most states (1.5-3%)• Carrier profit margins and risk charges are eliminated (3-5%)• Benefit Flexibility-State Mandates are avoided-Self-Funded

subject to ERISA and No HIT from Obamacare• Control costs auditing capability, bundled pricing and price

transparency. If Providers sees that you have the ability to see costs and go elsewhere, free marketplace kicks in and lower prices.

• Ability to design your own plan. Smokers pay more perhaps• Accessible claims reporting packages available. Historical data

to learn how to control claims. 80% of healthcare costs are treating 6 prevalent chronic diseases. (coronary, obesity, high blood pressure, depression, asthma, diabetes)

Page 10: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program

Advantages of Self-Funding a Plan

• Cash Flow Benefit- No longer paying for fully insured carrier’s reserves, so funds in reserve at the end of the plan year in the claim fund retained. Money is only paid out when claims actually occur and can stay in a reserve account accruing interest until it’s needed. If claims are lower than expected, that money adds to the reserve.

• Value-based benefits and wellness programs (Prevo Health)

• Self-insured companies can mitigate risk and lower admin costs by working with Prevo Health and Benefit Re that offers:

Stop-Loss Placement/ManagementClaims Processing (auditing ability to catch errors)Network Access and ManagementMedical Management

Page 11: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program

Benefits to Employees• Premiums stay lower than state or national averages• They keep the unused portion of their personal

health account, and it rolls over to the next year• They are healthier and stay out of hospitals• They get cash rewards for going to Centers of Value• Prescriptions are $1 or free• Profit sharing and wage increases can be higher• Primary care can be free• More productive• Job Security is enhanced

Page 12: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program

Disadvantages of Self-Funding• Risk assumption-100% of claims below the specific and/or

aggregate attachment point are the responsibility of the plan sponsor

• Provision of Services-Employer must provide the services the insurance carrier typically provides

• Outlined in TPA agreement, whom employer hires to operate the plan in accordance with ERISA

• Asset exposure-The employer’s assets are exposed to any liability created by legal action against the self-funded plan

• Annual Risk 10-25% of Expected Claims• Cash Flow fluctuations• Reserves needed to switch to self-insured• Requires a longer term commitment

Page 13: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program

Is Your Company a Candidate?

• Was medical renewal last year higher than expected?• Was the financial calculation of the renewal explained and

backed up with actual claim experience?• Were the reports provided to illustrate exactly where your

health care dollars were being spent?• Does the group’s current plan design take into

consideration specific needs and utilization patterns?• Are there financial incentives from the plan when claims run

lower than expected?

Page 14: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program

Stop-Loss Coverage

• Protection against catastrophic or unpredictable losses• Insurance company is liable for losses that exceed certain

limits called deductibles• The stop loss amount is a function of the company’s size,

risk tolerance financial resources, location, plan of benefits, PPO network, and claims experience

• The premium is a monthly rate• Specific and aggregate

o Specific: Claim on any one individualo Group: Entire group for policy year

Page 15: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program

Why Prevo Health & Benefit Captive

Re?

• Successful 10 years experience with other industry self-insure captives

• One of the largest TPA in the country• Benefits Captive Re and Claims Doc Ownership • Online Wellness Portal & Programming• Onsite Health Fairs and Educational Speakers• Concierge level Employee Services• Wellness & Prevention Programs change behavior

which in-turn reduces claims• Private Club industry first• Industry Best Practices (AHC)• CEO Pledge Legislation Voice in Washington

Page 16: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program

What Serigraph Implemented in 2004• Annual dashboard on tracking key metrics. Mandatory mini-physicals,

blood work at the company run by nurse practitioner. • 10% increase in rates for smokers• Earn up to 2 days off for “wellness days” for pursuing healthy

lifestyles and no more sick days off.• Elaborate point system for well-ness rewards• Coaching for co-workers who have health issues• A free, on-site dietician, nurse practitioner, and chiropractor• Free primary care doc through retainer whose mission includes

wellness, prevention, and chronic disease mgmt.• Formal programs for chronic diseases• Tracking health metrics and free 2nd opinions• $1 generic drugs (drug costs constitute 10-15% of a company’s

health care bill) • Offer a reward for finding billing errors and gives employees HALF the

recoveries• Bundled pricing, price transparency and Centers of Value• Health ratings for providers such as hospitals. Audits of health care

vendors. Ferret out which are the best and worst providers.• Free second opinions

Page 17: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program

• President of Serigraph, John Torinus Jr., says “ you can’t manage health costs without managing health. You can’t get people to manage their health without a large dose of education. They need active, personal touch.” He adds, “ most employees want to be responsible for their family’s health and health costs. They want to manage that part of their lives. They want the latest information.”

Page 18: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program
Page 19: Private Club Health Care Captive Self-Funded Group Stop Loss Captive Program

Contact Information• Rick Ladendorf or Darrell Fryer • 888-321-1804• [email protected][email protected]

• Cell: 949-933-5470 or 949-248-3112• www.prevohealth.com


Top Related