Self Funding Overview/Summary

As medical costs and insurance premiums continue to escalate, and health care reform poses new and additional cost pressures, employers are seeking innovative ways to reduce the costs associated with group insurance programs.  The solution for many employers has been the implementation of some form of self-funding.
[IMPORTANT: A previous blog post listed the specific Affordable Care Act (ACA) provisions that DO NOT APPLY to self funded plans.  Click here to access this blog - http://sstevenshealthcare.blogspot.com/2013/08/aca-compliance-understanding.html]
SELF-FUNDING ALLOWS THE EMPLOYER TO ASSUME ONLY AS MUCH RISK OR EXPOSURE AS THE COMPANY CAN WITHSTAND, WITHOUT CAUSING FINANCIAL DISTRESS.