Switch to Self-funding for Better Benefits at a Lower Cost
As the cost of healthcare continues to rise, many employers are switching to self-funding to manage costs and improve benefits for their employees.
An employer’s benefit plan plays a significant role in attracting and retaining talent. That’s why most employers offer some form of health coverage, even amid rapidly rising costs. In fact, more than 9 in 10 employers feel offering employee health coverage helps them with employee acquisition and retention. But, of employers offering commercial health insurance to their employees, 4 in 10 stated they are having difficulty affording group coverage.
It’s not only employers who are dissatisfied with the cost and coverage of their commercial health plans. Almost 6 in 10 employees said their employer’s health plan was not aligned with their needs. This is a major problem for employers because when employees are unable to take care of themselves and their families, they are more likely to leave an organization for an employer that offers more effective benefits.
So, in response to rising costs and employee dissatisfaction, employers are increasingly changing to self-funded insurance plans to manage costs and offer better benefits that match the needs of their employees. In 2022, over half, (65%) of workers covered by their employers’ insurance were in a self-funded health plan. Self-funded plans are popular with larger employers because they can manage the risk of higher-cost claims across many plan participants, but organizations of all sizes from various industries can realize the benefits of self-funding.
Gain Access to your Claims Data with Self-funding
Self-funding helps employers save money on their health plans because instead of paying a set premium to a commercial insurer regardless of the amount and type of healthcare utilized, self-funding allows employers to pay only for the healthcare their employees use.
Self-funding also gives employers access to their claims data beyond what is possible with traditional insurance models. By diving deeper into their data, employers can understand where their employees are spending their healthcare dollars, and more importantly, where they can save money.
When employers understand their employees’ health needs, they can focus their resources to make the most impact. For example, if an organization has a high concentration of employees with a specific health condition, the employer can guide them to seek care for that condition from a low-cost, high-quality provider. This not only saves employees money, but it also reduces the healthcare spend for their self-funded employer.
The Alliance helps our employer-members understand their claims data with our Smarter HealthSM Analysis, a healthcare analytics tool that digs deep into data to find savings where others can’t – or won’t. We help employers see where their employees are utilizing care and empower them to design a health benefit plan that meets their employees’ needs and directs them toward high-value care.
Work with the Best Vendors
Commercial insurers are affiliated with certain vendors, meaning employers with a traditional insurance model have to use these vendors for their health plans. When employers choose to self-fund with The Alliance, they have the flexibility to work with whichever vendors they choose, allowing employers to select the most innovative partners for their benefit program.
Working with vendors that align with the goals and values of an organization lets self-funded employers customize their health plans to their employees’ needs. Instead of relying on one-size-fits-all solutions, self-funding allows employers to implement innovative strategies that improve quality of care while reducing cost. Because self-funding gives employers access to their claims data, they can use data analytics to see where their employees are seeking care and refine their benefit plans and engagement strategies to prioritize what they need and exclude what they do not.
A recent report by Alight found that designing a benefit plan to meet employees’ individual physical, mental, and financial needs enables employers to “better meet the wide variety of needs of their workers and their families.” Taking a holistic approach with their benefit plan design helps employees access everything they need to keep themselves and their families healthy. When employees can take care of themselves and their families, they are more productive, feel recognized, and are more likely to be loyal to their employer.
Customize your Provider Networks with Self-funding
Using our Smarter Networks, The Alliance helps our employer-members develop custom, high-value benefit plans that optimize quality and savings. We contract directly with over 38,000 providers across the Midwest, which means broad freedom of choice for employees and serious savings for employers.
The Alliance offers multiple ways for employers to customize their network:
THE COMPREHENSIVE NETWORK BY THE ALLIANCE
This option offers a broad level of choice, encompassing over 38,000 healthcare providers, hospitals, doctors, and clinicians.
THE ALLIANCE & TRILOGY HEALTH NETWORKS
This custom provider network combines The Alliance Comprehensive Network and Trilogy Health’s provider network for even more coverage (over 91% of Wisconsin providers).
WPS STATEWIDE NETWORK & THE ALLIANCE COMPREHENSIVE NETWORK
WPS Health Insurance’s self-funded group plan paired with The Alliance’s network options offer convenient access to The Alliance’s Smarter Networks, WPS Statewide Network, and First Health National Network Wrap for broad coverage in the state of Wisconsin and nationally.
THE PREMIER NETWORKS BY THE ALLIANCE
The Premier Networks – The Premier Network Ruby and The Premier Network Emerald – are an option for employers who want to fully customize their health plan. The Premier Networks allow employers to create a multi-tiered benefit plan so they can incentivize their employees to seek care from high-value providers while still offering the choice to receive care wherever they are most comfortable. The Alliance can support up to four customized tiers.
As healthcare costs continue to surpass inflation, effective health benefits will become even more important. Employers looking to reduce their healthcare spend, while maintaining or improving quality for their employees should consider self-funding.
The Alliance serves as the voice for self-funded employers who want more control over their healthcare costs. We have remained a trusted, objective partner for our 340+ employers and their brokers who want improved access to high-quality healthcare for over thirty years.
If you’re tired of healthcare as usual, learn how self-funding with The Alliance can help you design the optimal benefit plan for your business and your employees.
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Mike Roche
Director of Business Development at The Alliance
Mike Roche joined The Alliance as member services manager in 2015. He is responsible for working with Alliance employers on health benefit strategies; sharing data-based information to help members manage their health care spend; and serving as a voice of member employers. Mike has a strong background in health benefits and self-funding. He previously served as a regional sales advisor for Digital Benefits Advisors in Madison, Wis., where he managed the health benefits for more than 160 credit union clients across 14 states. Prior to that position, Mike worked at CUNA Mutual Group in their employee benefits division for almost 10 years as an employee benefits sales specialist. Mike has a bachelor’s degree with a double major in marketing and business administration and is licensed in both health and life insurance in Wisconsin, Illinois, Iowa, Minnesota, Nebraska and Montana.
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