The only things that are sure in life are death and taxes. But if you are like many Americans, the need for insurance – specifically health insurance – is a sure thing too. According to a recent study by Kaiser, roughly 50% of the country receives health insurance through employers.
Most small to mid-size employers choose to stay in a fully insured medical plan for a variety of reasons, the biggest being predictability. At the end of the day, employers want to know how much it’s going to cost each month. What many don’t realize however, is that they’re literally paying a premium to have that “stability.” Another challenge is that many employers are simply unaware of how captives really work. In speaking with many new clients, we found that their previous benefits broker either did not understand them, sold against them, or just didn’t have access to a captive. Some new clients were already in a captive but found out that they were limited in choices.
What is Captive Insurance?
Quite simply, a captive is a mechanism by which several employers collectively purchase the most volatile piece to their self-funded plan – reinsurance. By purchasing reinsurance as a group, each individual employer gets the protection like that of a Fortune 500 company. At the same time, that individual employer with 150 employees can design their own plan (network, deductibles, copays, etc.), as well as carve out key pieces like pharmacy and care coordination.
This reduces volatility for the employer, allows them to see where each healthcare dollar is being spent and allows them to specifically target areas like pharmacy and care coordination that can save them hundreds of thousands of dollars a year.
There are several different captives available including broker-owned captives and member-owned captives. CGI Business Solutions works with the Pareto Captive which is a member-owned captive. We do this for a variety of reasons, the biggest is conflict of interest. To put it bluntly, we want to put in a solution that works best for each employer. Many broker-owned captives are contracted with certain pharmacy benefit managers or care coordination companies that, for a variety of reasons, are not in the best interest of every employer.
Why Consider the Pareto Captive through CGI Business Solutions?
The Pareto Captive specializes in helping mid-sized employers (50-1000 employees) by providing:
- Access to the strongest stop loss policy in the market including no new lasers in perpetuity.
- Transparency in real-time data, claims and expenses.
- Flexibility in carving out Pharmacy Benefits and/or providing access to Pareto’s pharmacy benefit consortium.
- Ability to purchase reinsurance at a much lower cost than traditional self-funded plans.
- Less volatility, even compared to being fully insured.
If you are an employer that has 50-1000+ employees (enrolled) and are tired seeing increases each year while your health plan gets watered down to stave off those increases, we’d love to show you how a captive can be the solution you’re looking for.
Taking control of your healthcare costs while customizing a health plan that works best for you and your employees is easier than you think. After all, it is why we use the Pareto Captive to provide health insurance to our employees here at CGI Business Solutions!