Health insurance is a critical aspect of any business's financial strategy. It is an essential tool to attract and retain talented employees, promote employee wellness, and protect businesses from financial loss due to unexpected health issues. However, traditional self funded health insurance plans can be unpredictable and costly for businesses, especially small and medium-sized businesses.

Fortunately, there is a better way - level funded health insurance plans. These plans offer predictable monthly premiums and comprehensive coverage options for businesses of all sizes. 

In this blog post, we will explore what level funded health insurance plans are, how they work, and the benefits they offer businesses.

What are Level Funded Health Insurance Plans?

Level funded health insurance plans are self-insured health plans designed for small and medium-sized businesses. Unlike traditional fully-insured health plans, where the insurance company assumes all the financial risks, level funded plans allow businesses to assume a portion of the risk.

In level funded health plans, employers pay a fixed monthly premium, similar to a fully-insured plan, to cover their employees' healthcare costs. However, if the actual claims costs for the year are less than the amount paid, the business receives a refund. If the claims costs exceed the amount paid, the employer is only responsible for paying the agreed upon amount..

How do Level Funded Health Insurance Plans Work?

Level funded health insurance plans are designed to offer businesses the benefits of self-insurance, such as cost savings and flexibility, without exposing them to excessive risk. These plans typically include the following features:

Monthly Premiums - Employers pay a fixed monthly premium to the insurance carrier, which is used to cover their employees' healthcare expenses.

Stop-Loss Insurance - This insurance protects businesses from excessive financial risks by limiting their liability for large claims. 

Claims Administration - Level funded plans typically include claims administration services, performed by a Third Party Administrator  which among other services process and pay employee claims.

Network Access - Most level funded plans offer access to a network of healthcare providers who offer discounted rates for services.

What are the Benefits of Level Funded Health Insurance Plans?

Level funded health insurance plans offer several benefits to businesses, including:

Predictable Monthly Premiums - With level funded plans, businesses can predict their monthly health insurance costs, making it easier to budget and plan for the future.

Customization - Level funded plans offer businesses the flexibility to customize their health plans based on their specific needs.

Cost Savings - Level funded plans can help businesses save money on health insurance costs by eliminating the overhead and administrative expenses associated with fully-insured plans.

Potential Refunds - If claims costs are lower than expected, businesses may receive a refund, providing additional cost savings.

Level funded health insurance plans offer businesses a better way to manage their healthcare costs. With predictable monthly premiums and comprehensive coverage options, these plans provide stability and potential savings for businesses of all sizes.

If you are interested in learning more about how level funded health insurance plans can benefit your business, contact us today at support@carepathbenefits.com or 1-888-750-0953.