Level-Funded Health Plans

Level-Funded & Self-Funded Plans Control Costs With More Flexibility

Looking for ways to manage healthcare spend without sacrificing quality? Level-funded and self-funded strategies can give you more control, better transparency, and access to broad national networks—while we guide you through setup, enrollment, and ongoing support.

Level-Funded: Predictability With Upside

Level-funded plans bundle a fixed monthly payment that covers three parts: a claims fund, administrative fees, and stop-loss insurance. If claims run below expectations, any remaining claims dollars may be returned or credited at renewal per the carrier’s program.

• Fixed monthly cash flow; mid-year surprises reduced by stop-loss protection.
• Potential refund/credit of unused claims dollars at renewal (program rules apply).
• Claims reporting transparency to inform wellness and plan decisions.

Self-Funded: Maximum Control & Transparency

Self-funded employers pay claims as they occur (typically via a TPA) and pair the plan with specific & aggregate stop-loss protection. You control plan design, vendor selections, and cost-management programs—ideal for groups that want the most flexibility.

• Custom plan design and clinical/cost-containment programs.
• Deeper claims insight for data-driven decisions (e.g., steerage, condition management).
• Requires budgeting for variability and IBNR (incurred but not reported) claims.

Networks We Can Leverage

We can structure level-funded or self-funded designs with broad national networks such as the Blue Cross Blue Shield national network, Aetna, and Cigna—subject to availability and plan eligibility in your market.

We’ll outline network options during the quoting process so your employees keep strong access while you keep tighter control of costs.

At-a-Glance Comparison

Feature	Level-Funded	Self-Funded
Monthly cash flow	Fixed “level” payments	Variable, tied to claims
Risk protection	Specific & aggregate stop-loss	Specific & aggregate stop-loss
Potential savings upside	Refund/credit if claims are low (program rules)	Direct savings from lower claims/utilization
Administrative lift	Moderate (carrier/TPA managed)	Higher (more vendor oversight)
Best fit	Small–mid groups wanting predictability + upside	Mid–large groups seeking full control

Self-Funded Cost Scenarios (Example)

When you engage in managing health plan costs, you’re aiming to come out ahead over the long run—even if results vary year to year. The example below shows how a self-funded plan compares to a fully insured “reference premium” across different claims outcomes.

	Minimum (Base Cost)	Great (Low Claims)	Typical (Avg. Claims)	Maximum (High Claims)
1. Benefits administration	$110,101	$110,101	$110,101	$110,101
2. Stop-loss premium	$400,000	$400,000	$400,000	$400,000
3. Your claims	$0	$547,274	$684,092	$900,000
Self-Funded total	$510,101	$1,057,375	$1,194,193	$1,410,222
Reference premium (Fully Insured)	$1,294,444	$1,294,444	$1,294,444	$1,294,444
% of reference premium	39.4%	74.7%	92.3%	108.9%

• Minimum = fixed costs only (admin + stop-loss), assuming no claims.
• Great = low-claims year.
• Typical = average-claims year.
• Maximum = high-claims year up to stop-loss protection.

What Is a Stop-Loss Captive? (Self-Funded Only)

A captive pools multiple self-funded employers together to share a layer of stop-loss risk. Each employer keeps its own plan design and TPA, but buys stop-loss through the captive. The group’s combined scale can smooth volatility and may reduce long-term stop-loss costs. Captives are only for self-funded arrangements (not level-funded).

How We Help

We guide you through funding model selection, quote multiple carriers/TPAs, outline network options (Blue Cross, Aetna, Cigna), and build a familiar enrollment experience with payroll deductions and bilingual support. We also provide ongoing guidance on stop-loss strategy, reporting, and annual renewals.

You get a plan that is a group plan—with more control over cost and design.