WHY CHOOSE AGGREGATE ONLY COVERAGE?
Aggregate Only Coverage is an innovative self-funding approach that provides all the advantages of an ERISA plan with the payment and annual Guarantee Risk of a fully insured health benefit program.
What is a Self Funded Benefit Plan?
A self funded benefit plan allows you, the employer by way of a Trust Agreement, the opportunity to custom design your benefit plan; to make decisions on the benefit levels, administration and funding; and provides budget certainty as you make monthly deposits to your claims fund.
What is ERISA?
ERISA stands for Employment Retirement Income Security Act, passed by congress in 1974. This Act provides you the employer the ability to establish your own self funded benefit plan. This is accomplished by establishing the Trust Agreement wherein you set benefit levels and administrative direction.
Who manages the Self Funded Plan?
Turnkey administrative services are contracted to provide premium billing to you, manage claims, collect payments for excess losses and make payment to providers. A complete package of documents- the Trust Agreement, the Plan Document, ID cards, PPO arrangements, Prescription Drug cards benefits and cards, Vision if required, all of these services are provided through a single turnkey administrator.
All provided at your direction. You are in control.
Does the Plan comply with Healthcare Reform?
Yes. The program was modified to comply with all benefit level increases and lifetime maxima at September 23, 2010.
What are the advantages of Aggregate Only Coverage:
- An annual maximum plan cost,
- Fixed monthly payments regardless of claim activity,
- Elimination of most premium taxes,
- The opportunity to retain dollars if your claim experience is exceptionally good.
How does the maximum plan cost help me as an employer?
The maximum plan cost and simple monthly payment approach of Aggregate Only Coverage is guaranteed by the participation of an insurance carrier who provides stop-loss coverage.
How does the fixed monthly payment work?
During the course of the plan year, the employer’s monthly payments are used to fund a claim reserve and to pay premium to the stop-loss carrier. As claims are presented for payment, they are paid first from the claim reserve. If the reserve is inadequate to pay bills when presented, the stop-loss carrier makes the payment. This bill payment procedure is seamless and requires no participation by the employer.
How does Aggregate Only Coverage eliminate most premium taxes?
There is no premium tax for the self-insured claim fund. Premium tax only applies to the stop-loss premium, which is significantly less than a fully insured plan.
How do I have the money to pay health claims?
You won’t go it alone. You will work with an insurance company that will provide aggregate coverage, which protects you against higher than expected utilization of health care dollars, and excess coverage, which will reimburse the Plan for high dollar claims. This provides you with budget certainty as you pay a defined amount each month to your account to meet these funding requirements.
How can I retain dollars if my claim experience is exceptionally good?
At the end of the plan year, and the six months following, if the claim reserve is not depleted by paid claims, any dollars left are retained by the employer. They can be applied to the cost of next year’s Aggregate Only Health Benefit Plan or used in any way to pay for or fund medical insurance programs or expenses for employees.
What are the next steps?
Determine the benefit levels you need,
Complete the Employer Application and Employee enrollment material,
Implement the Benefit Plan.