{"id":52325,"date":"2024-02-14T00:00:43","date_gmt":"2024-02-14T05:00:43","guid":{"rendered":"https:\/\/roundstoneinsurance.com\/?p=52325"},"modified":"2024-07-29T11:48:03","modified_gmt":"2024-07-29T15:48:03","slug":"3-macrotrends-that-drive-more-employers-to-self-funded-stop-loss-captives","status":"publish","type":"post","link":"https:\/\/roundstoneinsurance.com\/excelsior\/blog\/3-macrotrends-that-drive-more-employers-to-self-funded-stop-loss-captives\/","title":{"rendered":"3 Macrotrends That Drive More Employers to Self-Funded Stop Loss Captives"},"content":{"rendered":"

Looking back, these last few years at Roundstone have been an exciting ride \u2013 <\/span>we\u2019ve managed a consistent nearly 30% growth rate<\/span><\/a>, driven by the steadily increasing demand of the market. Why? What\u2019s causing more employers to make the move to a self-funded stop-loss captive?<\/span><\/p>\n

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Simple. They\u2019re caught between a rock and a hard place. Ask any employer come renewal season. The pain is real. <\/span>The cost of health insurance keeps getting more expensive<\/span><\/a>, and there <\/span>are many reasons why<\/span><\/a>.<\/span><\/p>\n

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Healthcare has become a top business expense<\/span><\/a>, second only to payroll. In the last 10 years, the cost of health insurance has skyrocketed over 150% \u2013 and it\u2019s projected to double in the next four years, <\/span>according to a Mercer Survey<\/span><\/a>. Employers as well as their employees are paying more. Everyone\u2019s frustrated and unhappy when it comes to healthcare.<\/span><\/p>\n

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Increasingly, small to midsize companies are turning to a stop-loss captive to mitigate risk and <\/span>make self-funding a safe, affordable, and viable option<\/span><\/a>\u00a0for their health insurance benefits.\u00a0<\/span><\/p>\n

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Three macrotrends on the horizon will only increase the incentive for small to midsize companies to turn to a self-funded stop-loss captive as a solution to affordable benefits.<\/span><\/p>\n

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These include:<\/span><\/p>\n

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  1. Employers increasingly suing health insurers over undisclosed fees and undisclosed conflicts of interest.<\/span><\/li>\n
  2. The expansion of genetically engineered and genetic treatment drugs, resulting in multi-million dollar prescription claims for employers that drive up the price of their plans.<\/span><\/li>\n
  3. Hospital price inflation in the wake of the COVID-19 pandemic.<\/span><\/li>\n<\/ol>\n

     <\/p>\n

    Here\u2019s what to expect for the future and how companies that self-fund their benefits plans can leverage considerable advantage<\/a> over these macrotrends.<\/span><\/p>\n

     <\/p>\n

    Insurance Mismanagement: The Problem of Undisclosed Fees and Conflicts of Interest<\/h2>\n

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    Increasingly, employers are suing health insurance companies over pricing practices, accusing insurers of rampant mismanagement driven through undisclosed fees and undisclosed conflicts of interest. Employers are expected to ensure any claims paid and fees charged are reasonable. Yet the data that hospitals and insurers are now required to provide by law often prove otherwise.<\/span><\/p>\n

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    Kraft Heinz Co., for example, filed suit against Aetna Life Insurance Co.<\/span><\/a> because the company allegedly pocketed undisclosed fees and paid millions of dollars in claims that shouldn\u2019t have been approved.<\/span><\/p>\n

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    Amy Gordon, an employee benefits partner with Winston & Strawn LLP, <\/span>told Bloomberg<\/span><\/a> that the exorbitant fees have become \u201c<\/span>very problematic that over the years, that they have essentially added more and more types of compensation into the agreement.\u201d Employers are obligated to ensure \u201cthat there are no hidden fees and expenses and limitations\u201d on audit rights in the contracts they enter into with service providers, she added.<\/span><\/p>\n

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    Such lawsuits have caused employers to be more proactive about the healthcare they buy. Self-funding under a stop loss captive offers both efficiency and accountability. Employers are under an obligation to their employees to deliver the best affordable care \u2013 and self-funding provides an efficient and affordable means to do so.\u00a0<\/span><\/p>\n

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    Roundstone ensures it always acts in the employer\u2019s best interest by never charging fees from vendors or providers. Everything we do <\/span>is aligned to deliver the best outcome for the employer<\/span><\/a> and their employees.<\/span><\/p>\n

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