The Attraction of Level-Funded Health Plans

The Affordable Care Act (ACA) has had a profound impact on small group health insurance. Rates have increased significantly as a result of the ACA. These rate increases have been particularly difficult for small groups.

This is where a level-funded health plan could be a good fit for your small business.

Level-funded plans are for employers who are trying to save money on the cost of group health benefits. Level funding also is ideal for employers with good health experience who feel they are paying too much premium for too little in benefits.

Do you receive money back from your insurer for being healthy? If the answer is NO, then a level-funded plan could be the right alternative for you.

Level-funded plans can save you money by paying the claims of your employees with your own money instead of insurance premiums. Money left in your account is your savings and not insurance company profits.

If you’re currently covered under a fully-insured plan, your monthly premium costs are locked in. Even if you’re healthy and have no claims, you don’t share in the savings, which are kept by the insurance company. Level funding allows you to keep the savings when your group is healthy while stop-loss insurance caps protects the plans from the high claims of any individual or for the total group. Level funding takes the guessing out of monthly costs. You pay one set monthly fee. After all of your claims are paid for the year, any unused money in your claim fund is returned to you.

Finally, level-funded plans often have the ability to add features that can reduce your monthly costs even further. Allied National has three features in particular that can help.

1. Reference-Based Pricing pays providers a rate based on a percentage above Medicare allowable reimbursement. This keeps payments reasonable and allows members to see any provider who accepts this type of payment. You can reach out to your agent or talk with one of our benefit consultants to learn more about this plan option.
2. HealthChoices is a program that exists to get Allied members to the right diagnosis, the right treatment plan and right provider for an optimal medical outcome. All while saving you premium and out-of-pocket costs.
3. Freedom Essentials is a major medical option that offers substantially lower costs than our Traditional plans while still providing comprehensive major medical coverage.  

It's important that the benefit consultants who serve you are equipped with all of the proper tools to give you the best opportunities for quality benefits at affordable rates. The level funding concept could offer tremendous advantages over your current coverage. If you have not been presented with this option, it is definitely worth seeking out a quote for your consideration.  

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Allied National

Founded in 1970, Allied is one of the nation's oldest and most experienced third-party administrators. Allied National is a 90 Degree Benefits Company, a subsidiary of Blue Cross Blue Shield of Alabama. As the small group benefit experts, Allied works with small business employers to provide unique and affordable group health benefits.