The brutal reality for employers is that the year over year constant increases for employee benefits are simply not sustainable. Year after year the increases referred to as trend, have had a greater impact on small and mid-size employers with no transparency on where the money is really going.

Employers are searching for Stability, Predictability, and Affordability with a long-term solution that allows them to differentiate their company with their employee benefit plans, levels the playing field between small & large employers, and provides the transparency to manage the cost.

Your Employee
Benefit Journey
Begins Here

Purchasing Options

OWN

LEASE

RENT

Owning your employee benefit plans is realized through the self-funding approach. While the perception of self-funding has been defined as complicated and risky, the reality is that in today’s market this provides an employer with the total freedom to build a unique benefit brand that the employer owns. The plans can be structured so that the financial cost is no more than renting. There are a variety of self-funding approaches that allow the employer to unbundle the service of the employee benefit plan and select the best in class components for their plan that provide complete transparency. Most importantly the group does not have to share the underwriting performance of the group with a carrier. Plan designs can be completely customized and the plan is exempt from state benefit mandates and regulations.

This provides the opportunity to implement a supply chain management approach to managing the purchase of employee benefits and is the path large employers use to provide highly competitive stable benefit plans.

In comparison you can think of this approach to purchasing a home where you have total control and get to make all of the decisions.

Leasing a benefit plan is typically realized through an approach defined as level funding. The services that make up the coverage are in a pre-determined bundle, provide more plan design choices, provides better rate stability, and does not provide options to customize or change various components. What this approach doe provide is limited access to claims data to allow you to make plan changes to address utilization and most importantly provides the ability of the employer to share and receive refunds with the insurance carrier based upon the claims performance of the group.

When you rent benefits, you are purchasing fully insured coverage that has all of the services required to provide benefits in a pre-determined bundle. This can be very convenient and easy to implement however this is the highest cost purchasing option and is subject to all of the State & Federal regulations Renting provides a limited choice of plans’, there are no options to customize or change the various components, there is no equity earned, provides no transparency, and is a short-term year-to-year approach. In comparison you can think of this approach like renting an apartment.

Market Segments

Many employers are unaware that their purchasing options in Employee Benefits are established by the market segment the employer is classified under based upon the number of employees in the company.

Each of the market segments have different criteria that determine the benefits offered and the options employers have. These market segments can have a dramatic effect on the costs and choices an employer encounters in purchasing employee benefits for their company. This segmentation by market size favors large employers and places small and mid-size employers at a disadvantage in offering employee benefits.