Slash Costs Instantly With This Self Funded Insurance Secret

How Self-Funded Insurance Works

In a self-funded insurance plan, the employer assumes the financial risk for providing healthcare benefits to its employees. Instead of paying a fixed premium to an insurance carrier, the employer pays for actual claims incurred. To manage this risk, many companies purchase stop-loss insurance, which provides protection against large claims by capping the total amount the employer must pay.

Self-funded plans often involve a third-party administrator (TPA) to handle claims processing, provider networks, and other administrative tasks. This setup allows employers to maintain control over their plans while benefiting from the expertise of the TPA.