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Unique Group Health Plan


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With our Special Aggregate Only product, companies can enjoy the benefits of both a fully insured plan and a self-insured plan. An aggregate only funding mechanism, the employer pays agg premium and funds for maximum claims and if end-of-year claims come in lower than what was funded, the employer gets that money back. And, unlike fully insured carriers, employers using this product will have total access to claims experience and have more control over the benefit plan.

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Unique Group Health Plan

  1. 1. Special Aggregate Only Funding Product “ EZ Agg” Justin P. Horn Regional Sales Manager 402-740-1757 [email_address]
  2. 2. An affordable self-funded alternative to a fully insured Plan for employer’s ranging from 25 – 250 employees ECU’s Special Aggregate Only Product: “ EZ Agg”
  3. 3. Advantages of Self Funding <ul><li>1.   Improved Cash Flow Employers improve cash flow when money formerly prepaid to the insurance company and held in the form of various reserves (such as unreported and pending claims) is freed for use by the employer. Self-funded plans only pay administrative fees and stop-loss premiums in advance. Claims are funded by the employer as they are paid by the administrator, typically 30-90 days after medical care is received. 2.   Cost Savings Fixed costs of a self-funded plan are normally less than those of a conventional fully-insured plan Elimination of most State Premium Taxes: In most states there is no premium tax for the self-funded plans (usually 2-3% of monthly insurance premiums). Only the stop-loss insurance is subject to the premium tax, which is a fraction of the fully-insured premium. Lower Administrative Overhead: Generally a TPA’s administrative costs are much lower than a traditional insurance carrier because they do no have the overhead of a large corporate structure. Retain Reserves When the Plan Has a Good Year: An employer saves money when the plan’s claims experience is better than expected. Their experience is only based on their own population, and not pooled with other employers, who may have poor claims experience. At the same time, the employer is protected (stop-loss) in the event that the plan’s expenses are greater than expected. 3.   Increased Control Plan Design Flexibility: Under ERISA, self-funded plans are exempt from state regulation. Therefore, an employer may establish uniform benefits for employees in different states, eliminating the need to comply with state mandates, taxes, and assessment. Furthermore, an employer has the flexibility to determine the appropriate plan design that will meet his own needs, and the plan can be amended at any time to  eliminate abuses, if they are encountered. Service Flexibility: In a self-funded plan, the employer has increased PPO network and Pharmacy Benefit Manager (PBM) choices, in addition to various other vendors. Additionally, Health Management strategy can be tailored to meet the unique goals of each client. </li></ul>
  4. 4. “ EZ Agg” <ul><li>ECU’s aggregate only product is designed to help: </li></ul><ul><li>- TPA’s gain market share in the small group arena </li></ul><ul><li>- Give Brokers and Agents a small group self - funded alternative and </li></ul><ul><li>a value added plan to their clients and prospects </li></ul><ul><li>- Smaller employers (25 – 150) move to a self funded health plan with </li></ul><ul><li>minimal risk and give them an opportunity save money </li></ul>
  5. 5. Cost Components <ul><li>TPA Administration fees and broker commissions </li></ul><ul><li> + </li></ul><ul><li>Stop Loss Premium </li></ul><ul><li> + </li></ul><ul><li>Claim Factors </li></ul><ul><li> = Maximum Liability </li></ul><ul><li>* The sum of all 3 components equal the premium equivalents. </li></ul>
  6. 6. EZ Agg Features <ul><li>Immediate advance feature – Helps with cash flow and allows for a fixed budget each month. If claims exceed the cumulative monthly attachment point then claims are immediately advanced by Pan American. Employer is responsible for funding monthly factors and premiums on day 1 of each month </li></ul><ul><li>Terminal Liability Option – This can be elected and paid for anytime prior to the contract end date. 3 months of paid run-out costs 1.5 months of premiums and factors. 6 months of run-out costs 2 months of premium and factors </li></ul><ul><li>Unlimited Aggregate Maximum – LTM per individuals still apply </li></ul>
  7. 7. Sample Cost Illustration Notes and Conditions *Please note detail of TPA fees, commissions and SL premiums on summary page. *TLO can be elected at any time in contract year prior to policy end date. *The numbers above only represent a maximum cost scenario and there is a possibility of saving money under this plan. *Signed group disclosure and confirmation of fully insured renewal is required to bind coverage as early as 30 days prior to the contract proposed effective date. (if an employer moves off anniversary date only current rates are required). Fully Insured Current Rates Fully Insured Renewal Rates Admin included EZ Agg Admin included EZ Agg w/ TLO census Rates Monthly Annual census Rates Monthly Annual census Rates Monthly Annual census Rates Monthly Annual 22 $320.00 $7,040 $84,480 22 $400.00 $8,800 $105,600 22 $398.00 $8,756 $105,072 22 $447.75 $9,850 $118,206 45 $600.00 $27,000 $324,000 45 $750.00 $33,750 $405,000 45 $744.00 $33,480 $401,760 45 $837.00 $37,665 $451,980
  8. 8. EZ Agg Advantages Fully Insured EZ Agg Traditional Stop Loss Capped Funding Yes Yes No Lasers No No Yes (some exceptions) Access to Claims Experience No (under 100 lives – Market specific) Yes Yes Cost Components Premium Only Premium and variable claims Premium and variable claims Administration Higher cost, Less Service Lower Cost, Great Service Lower Cost, Great Service Cash Calls None None Yes Potential for Savings No Yes Yes
  9. 11. Information Needed <ul><li>Census </li></ul><ul><li>Plan design – current and proposed </li></ul><ul><li>Current and renewal rates (when available) </li></ul><ul><li>Over 100 employees, claims data is required </li></ul><ul><li>Signed Group Disclosure Statement is needed to bind coverage </li></ul><ul><li>All quotes are net of commission </li></ul>