Factors to Consider in Making the Decision
When deciding if self-funding is right for your organization, make sure that you consider the following best practices to ensure that your self-funding strategy is appropriate and effective.
1. Evaluate Stop-Loss Coverage Most self-insured employers purchase stop-loss insurance on their self-insured health care benefit plans to reduce the risk of large individual claims or high claims for the entire plan. The employer self-insures claims up to the stop-loss attachment point, which is the dollar amount above which claims will be reimbursed by the stop-loss carrier. Obtain stop-loss quotes at several different levels. There are two types of stop-loss insurance: individual/specific and aggregate.
2. Understand the volume and nature of your employee health claims for the past five years Knowing facts such as whether your workforce is mostly young or old, whether the majority of claims were due to chronic illnesses or one-time incidents, and the total dollar amount of claims will help you budget for claims in the future. Self-funding should be viewed as a long-term strategy in which good and bad years average out in the employer’s favor.
3. Cash flow analysis Self-insured plans work best for companies that have a strong cash flow or reserves. Understand what your cash needs are, so you have money available to make timely claim payments.
4. Administration Decide whether it makes sense to administrate the plan internally or through a TPA. If you decide that it is best for your organization to use a TPA, make sure you factor TPA fees into your decision to self-insure. Obtain several different TPA quotes. Your TPA should offer a strong plan for monitoring the plan.
5. Coverage goals Decide on such things as eligibility, benefit coverage, exclusions, cost-sharing, policy limits and retiree benefits. Weigh the self-insured plan advantages of flexibility and lower average cost versus the increased risk and administrative responsibilities.
Factors Influencing Employers’ Decisions to Self-Insure
Employers with fully insured plans pay a set premium to a commercial insurer or health maintenance organization (HMO), and the insurer or HMO assumes full risk for all health insurance claims made by the firm’s employees. Employers with self-insured plans bear some or all of the risk for the health insurance claims of their employees and typically pay a third-party administrator (TPA) to perform administrative functions (such as claims adjudication, utilization review, collection of premiums, and customer service). Some firms offer both fully insured and self-insured health plans to their employees.
FACTS
some 73 million American workers and their dependents were covered by a self-insured health plan—that is, one in which the employer assumes the financial risk for providing health care benefits to its employees, rather than buying insurance. the federal Employee Retirement Income Security Act of 1974 (ERISA) exempts self-insured plans from state coverage insurance mandates, which can add to employer costs.
According to data cited in the Issue Brief, some 55 percent of the 132.8 million individuals in plans governed by ERISA were in a self-insured health plan in 2007. That number has increased from 44 percent in 1999.
The breakdown by firm size is striking: Among firms with 5,000 or more employees, 86 percent of workers were in self-insured plans in 2007. But among plans with 3 to 199 workers, only 12 percent were in a self-insured plan, Even for those small firms able to pay for health insurance, many could not afford the potential liability that can arise when a complex and costly illness occurs with a covered employee or dependent—meaning these firms cannot afford to take on the risk of self-insuring. Thus, smaller employers often purchase coverage from an insurer that assumes the risk of paying for benefits.
These plans are known as fully insured plans. Some 45 percent of the ERISA population was in a fully insured plan in 2007, or roughly 60 million people.
No, not anytime soon, but healthcare seekers over the last several years are replacing insurance with, well, not seeking healthcare
Is the world coming to an end? We'll have to wait until 2012 to find that out, unless the healthcare gods know something that we don't. As healthcare costs rise, consumer numbers fall, begging the question: Is healthcare not that important to us, or is it, but many of the underprivileged cannot afford it? As the graph shows, the richest consumers are spending more on healthcare, while the poorest are, as the graph shows, spending the same, though inflation offsets the numbers, suggesting that the poor are actually spending less. So is healthcare going to look more like a privilege down the road than a right? We'll have to anxiously wait and see. You can read entire article here.Efficiency, cost effectiveness, value for money and behavior in the production and consumption of health care is what health economics is for. Health economists study the behavior of health care systems as well as health-affecting practices. The application of health economics reflects eagerness to obtain highest value for money by ensuring clinical effectiveness and cost-effectiveness of healthcare provision. While Outcomes research is the study of end results of medical care, health care processes and the well-being of populations.
Health Economics and Outcomes Research (HEOR) information is increasingly used to fully demonstrate a product’s effectiveness (Pharmaceutical etc.). But why is HEOR important today? Resources in healthcare are insufficient and not fully developed. Effectiveness, safety and quality medical products are the main focus of HEOR. Today, companies must show increase value over the existing care that has been proven effective especially now that the competition is stiff.
Healthcare demands are steadily increasing from the supply for health, medicines and services. Health care is demanded by consumers to carry out larger "health capital." The demand for health is great unlike most other goods because individuals designate resources in order to consume and produce health.
One of the aspects of HEOR is the assessment of value. In other words, the most important thing is whether a product/service is effective and if it benefits people. Therefore the question has been answered sufficiently, the incremental cost efficiency is considered.
According to study, the value of HEOR investments, which, for the industry as a whole, is at approximately $500 million a year. Truly a hefty amount of money.
HEOR helps healthcare authorities, consumers, patients to understand the impact of alternative therapies and treatment options available in the market. Achieving a favorable acceptance from healthcare authorities is critical to ensure that new innovations are incorporated into guidelines of care.
Ultimately, obtaining ‘value for money’ indicates efforts to maximize the benefits of HEOR to the population of patients served from a limited amount of resources.
Many patients have found that there are amazing benefits to traveling abroad for medical treatment. The biggest benefit of course being a large cost saving. However, at what cost is it worth traveling abroad? How are patients able to protect themselves when traveling abroad when each country has its own laws? Many countries have very little recourse for foreign patients and it’s important that before you decide to go abroad for surgery you know the laws of the country you are planning to go to. This is another good reason to make sure you know the quality of the hospitals and/or clinic you are going to abroad. It is important that you do some research before you go and check for accreditations. It is always a good sign when the facility you are planning to go to has some form of accreditation. The most important accreditation to look for is JCI (Joint Commission International). There are of course other accreditations that are equivalent to the JCI, the key is just to do the research beforehand. If you are still unsure about the quality of the facility reach out to us at HOW. We do extensive research into facilities all over the world and can help you find out which hospitals will be the best for your specific surgery.
HOW wants to make sure that when traveling abroad you as a patient are protected. We know that there are many scams out there in the medical tourism world and that is why we have created a completely transparent website. The facilities we work with are some of the top in the World. Know that you can trust HOW to take care of you and help you make an educated decision about which facility and country is best for you.
Here is a recent article on some experiences patients have had when traveling abroad. Click Here.
I recently came across this incredibly sad article about how a young man from Cincinnati just 24 years old died from a tooth infection. Due to his lack of health insurance and inability to afford treatment the infection spread to his brain and eventually killed him. He did go to the emergency room when his face started to swell and the doctor prescribed him some antibiotics. He however couldn’t afford the antibiotic and instead just used the pain medicine.
Read the full story here.
One of the hardest and most rewarding parts of being a doctor is being able to make a difference in your patient’s life. I recently came across this interesting article on 10 things that you can do to really provide personal service to all of your patients and be sure that they can feel it. Some of these reasons really do hit home and may even be things that you yourself have experienced before yet have never really thought about being problems of your patients. I think that out of the 10 one of my favorite points that are brought up is the power of being positive. So often your patients may be very negative and already extremely down on life and the possibility of any possible outcome in their future. It really is important that the physician is able to stay positive and that they can really help their patients see not just the negative but also the positive.
You can read the full article by Kevin MD by clicking here.
Google made public this week their intent to acquire Motorola Mobility. This has me and many others wondering whether Google might be setting itself up for a second chance to take a crack at the healthcare market. Google may have found a new "in" to healthcare with this acquisition of Motorola Mobility. What are your thoughts?
Read the full article here
As someone who genetically has high cholesterol I understand how frustrating it is to be at risk for a chronic disease. That's why I decided to make it a priority to actively work on lowering my cholesterol and I'd like to share some tips that I've done that have been successful. The hardest part is learning what to do and setting up a game plan.
Once you have your plan in place all you have to do is act on it. Here are some of the successful things that I have done to lower my cholesterol: Work out: - it's critical to workout at least 4 times/week, with at least 3 of them being cardio intensive for at least 30 minutes each time. Activities such as running, walking, bike riding, rowing, swimming, etc will do wonders for you. The key here is that you have to make this a priority and follow through. It's also very important to do some sort of strenth training (can be with weights, or pushups, bands, etc) at least 2 times/week. Food: - If you're like me and you have high cholesterol then you have to watch what you eat. You have to cut down on fatty foods such as cheese, fried foods, fatty meats, etc which isn't nearly as difficult as it seems. Eating low-fat cheese & yogurt is ok and so is eating a lean meat such as a small filet mignon.
The key here is to not eat these foods every day. I've found that hummus is great on almost anything and it's extremely healthy, plus it takes the place of mayo and cheese on my sandwhiches. - Eat veggie burgers for lunch, they're easy to prepare and when you add hummus (and hot sauce!) they taste great. I prefer Dr. Praeger's burgers and literally eat one of those every day. I also try to limit my carb intake so I only use one piece of bread. Supplements: - If you're planning on using natural products such as herbs and other supplements it's very important to first check with your doctor before doing so.
After speaking with my doctor I decided to take Red Yeast Rice which is one of the natural building blocks in cholesterol-fighting medicines such as Lipitor. I've had huge success with Red Yeast Rice but like other medicines and supplements it can irritate your liver. So I tend to go on and off of it every few months or so. I also take Co-enzayme Q or CoQ because that gets depleted when taking the Red Yeast Rice. I hope this helps and I'll make sure I update this blog as I come across even more techniques that work.
Watch the Youtube video on Goldi's Guide to Healthcare
For those of you who don't understand the finer details of the Affordable Care Act, rest assured -- the government doesn't seem to either. As the article in MSNBC points out, the health care reform law allows for millions of middle-class people to obtain free health insurance. Medicaid is a government health insurance program that is meant to be used as a last resort for those who are poor and have no means to pay for care. Not for middle-class folks who do have the means and thus could be getting a free ride.
The new law is supposed to bring fairness to an unfair system; however under new federal law a married couple who making $64,000 a year will be able to receive Medicaid benefits. Not only is this counterproductive but it's not sustainable. We simply cannot afford this which is why the Obama administration is looking for a way to change this.
The health care system in the US is broken and it needs to be fixed. Not by providing free care to people who can already afford it but by providing true efficient measures that are based on economic and behavioral modifications.
Why is it that Moore's Law works in the high tech sector but not in the health sector? Perhaps it's because in almost every other sector of the economy the true costs are transparent. Yet, in the health industry, most end-users, or people consuming the goods or services, aren't the ones paying the bill. And therefore, aren't being empowered to make decisions as consumers typically do.
Providing access to care is something we need to do for people, especially those that don't have the means to pay for it. But that's not good enough. We need to drive up the quality of care while lowering the costs of care. We can emulate Moore's Law and bring it into the health sector. We can empower patients to demand the best from their health care providers, making them more accountable to the patient rather than to the insurer or government entity.
It's all possible, and just like anything else, it takes hard work, focus, and a willingness to do what's right...not necessarily what's popular.
Watch the Youtube video on Goldi's Guide to Healthcare.
