LionGen is a Third Party Administrator (TPA) that manage different functions of benefits such as: claims processing, utilization review, membership functions; including the processing of retirement plans and flexible spending accounts. For self-funded entities, we administer: medical/dental provider networks, stop loss insurance, pharmacy benefit manager (PBM), medical management, voluntary benefits and many more.
A self funded healthcare plan, sometimes referred to as a self insured, or partially self funded healthcare plan, is a healthcare plan in which the sponsoring entity (Taft Harley Fund or Employer Group) assumes the financial responsibility for providing health care benefits to its members/employees.
Self Funded vs. Fully Insured
|Self Funded||Fully Insured|
|An administrative service company collects from your company then pays doctors and hospitals for claims.||Your health insurance company pays doctors and hospitals for claims.|
|Claims cost can vary from week to week. You can cap your liability with stop-loss insurance to protect against excess risk.||You pay the same monthly premium no matter what your employees’ individual claims are.|
|Design the plan that fits your clients’ workforce needs.||Limited plan options; your clients typically must select a plan from several set levels (i.e. Platinum, Gold, Silver, or Bronze).|
|Your clients only spend money on the services that they need.||They pay for the whole package, including services they may not need.|
|You retain the money that is not spent.||Any funds leftover simply become more profit for the insurance company.|
|We give your clients access to reports that show how every dollar is spent.||Carriers are often reluctant to provide any actionable data.|
What are the Benefits of Self Funding?
- Control: You can customize the plan to meet the specific health care needs of your workforce, as opposed to purchasing off the shelf products in the traditional market.
- Interest Income: Many companies establish self insurance reserves. The self funded employer maintains control over the health plan reserves, enabling maximization of interest income – income that would be otherwise generated by an insurance carrier through the investment of premium dollars.
- Improved Cash Flow: You do not have to pre-pay for coverage, thereby providing for improved cash flow.
- Less Regulation: Self Funded Plans are regulated under federal ERISA laws and therefore are not subject to conflicting state health insurance regulations and benefit mandates.
- Lower Tax: Self Funded Plans are not subject to state health insurance premium taxes, which are generally 2-6 percent of the premium’s dollar value.
- Flexibility: You are free to contract with the providers, provider networks, Pharmacy and Care Managers best suited to meet the health care needs of your plan and employees.
Who Administers the Plan?
A Third Party Administrator (TPA) administers the plan. Their responsibility includes maintaining eligibility, customer service, adjudicating and paying claims, preparing claim reports, plus arranging for managed care services such as network access and case management.
How is the Plan Protected from Large or Catastrophic Claims?
You elect to fund risk up to a certain level. Beyond that point, reinsurance or stop loss insurance is typically purchased to reimburse you for claims above a specified dollar level. Stop loss is designed to limit the plan’s loss to a specified amount and to ensure that large or unanticipated claims do not upset the long tern success of the plan. The amount of risk to be insured is a function of the employer’s size, nature of their business, financial experience and tolerance for risk.
Is Self Funding for Everyone?
No. Since a self-insured employer assumes the risk for paying health care claim costs for its employees, it must have the financial resources to meet its obligations, which can fluctuate. Therefore, employers with poor cash flow may find that self-insurance is not a viable option. Also, employers with a short term outlook may not be a good fit. It is statistically probable that self funding will save money over the long term and many employers do save money immediately. However, results can vary in the short term. Therefore, employers should have a 3-5 year commitment.
Is Self Funding Only for Large Employers?
A common but incorrect assumption is that self-funding is only for large employers. Sef-funded health plans can be prudently set up by smaller employers as well. Similar to our work with larger employers, LionGen helps the smaller employer select the appropriate level of stop-loss insurance, which provides reimbursement for large catastrophic claims and aggregate claims.
- Maintain Union Membership Dues, Contributions including reciprocals, PAC
- Maintain Employer details and Contracts
- Manage Master Contract/Contribution Accounting including Delinquency – Billing and Remittance
- Payroll Audit
- Eligibility maintenance and recalculation; Maintain clearing account
- Process COBRA, Self pay, Pension deductions to maintain Eligibility
- Maintain Legal Fund
- Manage Annuity Fund – including file transfer, record maintenance
- Medical Claims
- Dental Claims
- Hospital Claims
- Medical Pre-certification
- Dental Pre-certification
- Disability Claims processing
- Death, AD & D Claims processing
- Process Vision Claims
- PBM Pharmacy Claim Import and Reporting
- Process HIPAA EDI – Eligibility & other data transmissions
- Maintain Master Code Sets – HIPAA compliance
- Process Positive Pay Files, ACH payments
- Process mandatory filing to IRS and CMS (Secondary payer)
- Third- party Accounting Inter face
- Ad-hoc Reporting System and High Level Management Dashboard
- Interface with Document Management Systems
- Track Customer Service Inquiries and Manage Tickets