What is self-funding?

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Every company is unique, and so are the people who work for them. Today, employers have the option to self-fund, which means employers pay for their employees’ medical bills directly while a third-party administrator (TPA) typically administers the plan. This gives employers the unique ability to control costs and maximize benefits.

Unlike self-funded plans, a fully insured health insurance policy consists of employers paying an annual premium to an insurance company that assumes all financial risks (regardless of whether or not the employees use the plan or services).

Self-funded employers rely on Pinnacle for facilitating the claims processing and payments, the healthcare network, financial reporting, and other various benefits administration services on their behalf.

What are some of the benefits of self-funding?

Cost Savings. When employers choose to self-fund, they have the ability to control costs by paying for claims as they are incurred rather than paying a monthly premium.

Customizable and Flexible Plan Designs. Healthcare is not a one-size-fits-all solution. Employers who self-fund have the ability to design their own health plans to meet their specific needs.

Transparency. Employers who self-fund are given insight into their health plan, including various claims, spend, and utilization reports. This gives employers the ability to review their plan and make any necessary revisions to the plan that will benefit not only the company but also their participating employees.

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