4 ways self-insurance goes astray
August 18, 2009 by Bill MeltzerPosted in: Health care, Latest News & Views, Pay and benefits
Any major illness can result in a major cost hit for self-insured health plans. But some are more “major” than others.
According to a recent report, these four conditions are the most likely to cause catastrophic claims for self-insured companies:
- Extreme premature births (24 to 25 weeks’ gestation) can cost $700,000 to $900,000 in hospital inpatient charges and followup outpatient treatments for mother and child.
- Liver or kidney transplants average about $760,000 in total claims.
- Non-transplant kidney disease treatments averages $200,000 to $400,000 in claims.
- Hemophilia-related claims average about $300,000.
There’s only so far your company can go to determine what percentage of employees are at risk for these conditions. But if you are self-insured or considering that route, you can work extra hard to raise employee awareness and encourage employees and their dependents to undergo health-risk assessments on their own.
Tags: health costs, self-insurance
August 24th, 2009 at 3:26 pm
There are some great pre-natal programs available and groups need to make sure they have centers of excellence available.
August 27th, 2009 at 8:34 am
One of our members had a liver transplant. Of course, our premiums increased dramatically. We has only ten people on our plan. After three years, the increases leveled off.
August 27th, 2009 at 11:08 am
These examples are why anyone who is self insured should have an umbrella policy that caps the employer’s liability for each employee annually. We have a $50,000/employee/yr. cap. With this cap, once the empolyee reaches $50,000 the umbrella policy kicks in and picks up the back end. Your experience still takes the hit, but companies pocketbook does not.
August 27th, 2009 at 11:42 am
Any business that is self-insured should purchase stop loss insurance or reinsurance policy that limits their total out of pocket expenses to an amount that they can comfortably afford to self insure! This should also help limit the premium adjustments due to catastrophic illness claims. Businesses typically choose to self-insure because the savings will often be 10-15% over a carrier based plan. Any reputable administrator should include this in any self-insured employee benefits program.
September 14th, 2009 at 3:47 pm
Hi what entice you to place an article. This article was extremely interesting, especially since I was looking for thoughts on this study last Thursday.