At Preferred Insurance, we understand that as a small business owner, offering quality level-funded health plan insurance benefits to your employees is a priority. However, finding a cost-effective solution that balances affordability and comprehensive coverage can often feel like a daunting task. That’s where a level-funded health plan can make all the difference. This innovative approach to group health insurance is gaining popularity among small businesses in Colorado Springs, offering predictable monthly costs with the flexibility of self-funding. In this blog, we’ll dive into what self-funded health plans are, how they work, and why they may be the right choice for your business.
What is a Level-Funded Health Plan?
A level-funded health plan is a hybrid between a fully insured and self-funded insurance plan. It allows small businesses to have more control over their healthcare costs while still providing their employees with comprehensive coverage. Essentially, your business will pay a fixed monthly premium, much like a fully insured plan, but a portion of that premium is set aside for potential claims. At the end of the year, if the claims are lower than expected, your company may receive a refund for the unused funds. This structure offers predictability in costs while still allowing the opportunity for savings.
One of the main advantages of a level-funded health plan is the ability to share in the savings if claims come in lower than anticipated. As a small business owner in Colorado Springs, this can provide financial relief and the opportunity to reinvest in your business. Level-funded plans also come with the backing of stop-loss insurance, which limits your liability in case claims exceed expectations, reducing the risk of an unexpected major health expense within your workforce.
How Does a Level-Funded Health Plan Work?
In a level-funded health plan, you, as the employer, pay a fixed monthly premium that covers all of your health benefits costs. This premium includes the cost of insurance, administrative fees, and a fund to cover future claims. The plan is designed to offer the predictability of a fully insured plan while also giving you the potential to save money through a medical screening aspect.
At the start of the year, the insurance company puts aside a certain amount of money for your company’s claims. If your employees use fewer medical services than expected, the unused funds may be returned to you, offering a financial benefit. On the other hand, if claims exceed the expected amount, the stop-loss insurance kicks in, limiting your exposure. This structure offers small business owners in Colorado Springs more flexibility and cost control while still ensuring employees receive the coverage they need.
The Benefits of Choosing a Level-Funded Health Plan for Your Small Business
There are several compelling reasons why a level-funded health plan could be the best choice for your small business in Colorado Springs. One of the most significant advantages is cost savings. Unlike fully insured plans, which come with set premiums, level-funded plans allow businesses to benefit from lower insurance premiums if claims are lower than expected. This can result in significant savings at the end of the year.
Another benefit is the flexibility and control over your healthcare plan. With a level-funded plan, you can customize coverage to meet all the unique needs of your employees. You can choose the specific benefits and options that work best for your workforce while still maintaining cost predictability. Additionally, as a Colorado Springs business, you’ll have access to local insurance brokers, like us at Preferred Insurance, who can help tailor a level-funded health plan to meet your needs.
Lastly, level-funded plans provide a safety net with stop-loss insurance, which can help protect your business from unexpected, high medical costs. With this coverage, you can have peace of mind knowing that your financial exposure is capped, even if claims exceed the expected amount.
Is a Level-Funded Health Plan Right for Your Business?
While a level-funded health plan can be an excellent solution for many small businesses, it’s essential to determine if it’s the right fit for your specific needs. The ideal candidates for this type of plan are typically businesses with 10 to 100 employees with a relatively healthy workforce.
If your business has a healthy workforce with low medical claims, a level-funded plan could be a great way to lower your insurance costs and possibly even receive a refund at the end of the year. However, if your employees are high-risk or have a history of frequent medical claims, a fully insured plan might be a safer choice.
At Preferred Insurance in Colorado Springs, we specialize in helping small businesses navigate the complexities of group health insurance. Our team can help assess your company’s needs and determine if a level-funded health plan is the best solution for you.
How Preferred Insurance Can Help with Level-Funded Health Plans
Navigating the world of group health insurance can be overwhelming, especially when trying to determine if a level-funded health plan is right for your business. At Preferred Insurance, we offer expert advice and personalized service to help you make informed decisions. With over 30 years of experience in the industry, we specialize in assisting small businesses in Colorado Springs to find affordable health insurance options that meet both their budget and the needs of their employees.
Our team of seasoned brokers works with all group health insurance plans in Colorado, including level-funded plans, and we are committed to providing ongoing customer support after the sale. We’ll help you understand all of your options, guide you through the enrollment process, and be there to assist with any claims or provider issues that may arise.
By choosing Preferred Insurance, you gain access to a team that cares about your business and is dedicated to ensuring your employees receive the best possible care. We’ll work closely with you to find a solution that makes sense for your business’s unique needs, and we’re here for you every step of the way.
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The Bottom Line: Is This the Right Choice for Your Business?
A level-funded health plan offers small business owners in Colorado Springs the opportunity to save money on healthcare costs while still providing comprehensive coverage for employees. With predictable monthly premiums, the potential for cost savings, and the security of stop-loss insurance, a level-funded plan is an attractive option for businesses looking to balance affordability with quality care.
At Preferred Insurance, we understand that choosing the right health insurance plan for your small business can be a complicated decision. That’s why we’re here to help guide you through the process, offering personalized service and expert advice to ensure you find the best plan for your business.
If you’re ready to explore the benefits of a level-funded health plan for your small business, don’t hesitate to reach out to us today. Our team in Colorado Springs is here to answer your questions, provide you with a free quote, and help you make the best choice for your business and your employees. Contact Preferred Insurance now for a quote and to learn more!
