Blue Ridge Companies decision to go its own way for employee health insurance coverage was profiled in the December, 2015 issue of Units Magazine. It’s a complex issue, but as Executive Vice President Susan Passmore explains in the article, it’s an increasingly important consideration for all management companies. Here are a few excerpts from the article:
Blue Ridge began its plan in May 2014 and currently 200 employees and 60 dependents are participating.
“You can convert fairly easily,” Passmore says. “In general, if you stick with the plan, over a five-year period, you will begin to see a trend that defines where your medical insurance dollars are being spent.”
Self-insured plans, she says, simply are not subject to all of the same regulations and fees as fully-insured programs. The result for us is approximately 3.5 percent less fees paid to the government.
Although self-funded plans have certain requirements, Passmore says her company is able to tailor a variety of services within each plan, based on her associates’ needs.
“No more are we at the mercy of fully-insured off-the-shelf design offerings,” she says. “By us reviewing and recognizing common claims usage, it allows us the flexibility to tweak the plan to fit the needs of our employees and reduce costs for our company.”
Blue Ridge uses a third-party administrator (TPA). And Passmore says large insurance company Cigna, which formerly administered her company’s plan, is still involved.
Blue Ridge outsources its TPA, who functions as a benefits manager and provides basically the same services as a traditional carrier…
Passmore says that most carriers, including Cigna, partner with the third-party administrators (TPA) to share their discounts.
“This allows health-care providers to file claims through the traditional carrier networks, and it allows us to benefit from the carriers’ negotiated pricing. The claims pass through the carriers’ pricing network and are then captured by the TPA and forwarded to us to pay.”…
“We need healthy associates to be successful so we certainly want them to seek care when they need care,” Passmore says. “Moving to a self-funded insurance plan really fits our company’s culture. One of our company’s tenets is ‘teamwork; appreciating self and others, having a balanced way of life and having fun together.’ Since our shift to this plan, our associates have become engaged in taking both individual and collective responsibility in the overall cost of health care.
“We know there will be accidents or conditions that result in really expensive claims. It’s inevitable. We have stop-loss coverage, which reimburses us for single-claim events that cost more than $50,000. Protection of stop-loss coverage is a must, and adding a separate organ transplant rider strengthens the protection against loss.”
You should definitely check out the full article here.