Assurant Self Funded Small Group Plan

[ERISAgaga]

If employees are on Medicaid they do not count as eligible employees for compliance issues or carrier participation requirements.

This is why there are MEC plans with added benefits or Limited Benefit plans added in. The lower income employee can get coverage that meets the Individual mandate for family at a low rate if they do not qualify for Medicaid.

The other idea is use the ERISA plan to cover those that make above the FPL.

That you can underwrite an ERISA plan is part of its advantage.
One of my TPAs uses a de-Identified Underwriting process that is fast and does away with the paper health forms. This is great for virgin groups.

 

[jmarkk1]

If employees are on Medicaid they do not count as eligible employees for compliance issues or carrier participation requirements.

This is why there are MEC plans with added benefits or Limited Benefit plans added in. The lower income employee can get coverage that meets the Individual mandate for family at a low rate if they do not qualify for Medicaid.

The other idea is use the ERISA plan to cover those that make above the FPL.

That you can underwrite an ERISA plan is part of its advantage.
One of my TPAs uses a de-Identified Underwriting process that is fast and does away with the paper health forms. This is great for virgin groups.

I know that medicaid eligible employees don't count and I do think this will help them moving forward.
However, I was shocked that one of my FMO'S recommended a non guaranteed issued plan as only option.
Can you explain MEC plans and what carriers offer them? Also, can you explain ERISA plans?

 

[scagnt83]

However, I was shocked that one of my FMO'S recommended a non guaranteed issued plan as only option.

It is not Guaranteed Issue on a group basis, but if they approve the group then each individual eligible employee is guaranteed coverage.

Assurant only does a RX check for their new self funded products (at least in SC), so the UW is easy. No long health history forms to fill out.

No self-funded plan is guaranteed to be approved. That is the whole point of self-funding. If you have an unhealthy group self-funding will not work, if they are relatively healthy and especially if they have a lot of minor dependents, then it works well usually.

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Can you explain MEC plans and what carriers offer them? Also, can you explain ERISA plans?

MEC is "Minimum Essential Coverage". Meaning it meets the Affordable Care Act requirements for Coverage.

An ERISA Plan is another way of saying a Self-Funded Health Plan.
It is a bit misleading since all health plans are regulated by ERISA... along with employer sponsored retirement plans and IRAs. But that is the lingo in the health insurance world for it.

 

[somarco]

Tyler, you know this but ERISA was drafted primarily for retirement plans. So it is not just limited to group health.

My view is that JMark is in over his head and should enlist the help of someone that understands self funding, but that is just my opinion


https://www.tasconline.com/biz-resource-center/plans/erisa-plan/

 

[scagnt83]

Tyler, you know this but ERISA was drafted primarily for retirement plans. So it is not just limited to group health.

My view is that JMark is in over his head and should enlist the help of someone that understands self funding, but that is just my opinion


https://www.tasconline.com/biz-resource-center/plans/erisa-plan/

You are correct that it was primarily created to regulate retirement plans. You would know better than me, but weren't the HI provisions added later down the road?

And I agree. He needs to partner with an experienced agent for this one.

 

[somarco]

Can't say when health was "added" to ERISA, or even if it was added. Could have been there all along and never got much attention until after the dust settled from all the DB pension plans terminating.

Section 401(k) of the IRC was added in 1978 but it wasn't until a few years later that Ted Benna took note of the provision and figured out a way to "create" a new pension funding mechanism.

This EBRI publication provides a bit of insight into how health & welfare plans became part of ERISA.

 

[leevena]

When ERISA first appeared the link to health and welfare plans was focused on two specific areas; retiree health and plan disclosures. As self-funding became popular in welfare plans ERISA was a vehicle by which plan sponsors could avoid state regulation of their plan. Keep in mind that the ERISA preemption has a wide effect.

JMarkk1, the advice given earlier does seem to make sense to me, that being you may want to consider recruiting someone with a self-funded background to assist you with this group. Self-funding is relatively easy to learn, but not to master. There are many rabbit holes that you can go down.
If I may give you a piece of advice, you may want to think differently about self-funding. You mention that you would be interested in this option if there was guaranteed issue. The last thing you want is guaranteed issue. Self-funding means that the employer now becomes the payer/insurer and guaranteed issue means that the employer will be paying for bad risk. You were correct in stating that self-funding is not for everyone, in this size market.

Self-funding in larger groups is usually the way to go, there are exceptions. In the small to medium size market, say under-250 lives+-, self-funding is usually done in a level-funded vehicle. Keep in mind, that in this size market, your targeted groups consist of 40% or less of the groups. I say this because the fully-insured market is usually priced at some version of a community-rate or manual rate. Or to think of it another way, an average cost. So if you need to be below the average, it limits your possible groups to below 50% immediately.

Hope this helps, and good luck.

 

[ERISAgaga]

Can you explain MEC plans and what carriers offer them? Also, can you explain ERISA plans?

Sure. MEC plans are plans under the ACA or PPACA that meet the minimum essential coverage guidelines, 63 types or forms of physicals. To meet the individual mandate this is all that is required. These plans are alot less expenseive than traditional plans because they do not cover illnesses. A MEC plan does meet part A of the Employer Mandate. (The employer offers this and can avoid the $2000 a year tax penalty for not offering a plan.) An employee can take it and meet their individual mandate and the employer is off the hook for the part B tax penalty. However if an employee declines and gets a subsidy the employer is still liable. These MEC plans are not offered thru the fully insured market only the self-funded/ERISA market. These are created by TPAs with the basic coverage or some add in limited benefit plans or other benefits into it (but if it does not meet Minimum Value with hospitalization and surgery it does not meet part B of the Employer Mandate). Several of the TPAs I work with offer these plans that will cover sick office visits and some testing, but no hospital or surgery so they are still MEC plans.

An ERISA plan is just another way of saying self-funded. They are covered under the ERISA regulations and do not have to meet all the ACA regulations. With ERISA plans you can underwrite medically for the group, you do not have community rates and you do not pay all the ACA taxes. Most of the ERISA/self-funded plans that I do now are fully funded so that the monthly premium is the max liability an employer has in the program.

There are a large number of A rated carriers that will do aggregate coverage for MEC plans as well as the coverage for a fully funded plan.

I would be happy to send you some MEC designs and rates.

Glenn

 

[jmarkk1]

The only reason I even came across self-funding was due to a recommendation from one of my FMO'S. Group is a nursing home and before ACA kicked in the employees never took any group plan offered because most are on medicaid even though full-time.
FMO recommended self-insuring as option and I assumed group coverage could be underwritten on guaranteed issue basis. My only issue was recommending this as only option if it wasn't guaranteed issued.

 

[scagnt83]

The only reason I even came across self-funding was due to a recommendation from one of my FMO'S. Group is a nursing home and before ACA kicked in the employees never took any group plan offered because most are on medicaid even though full-time.
FMO recommended self-insuring as option and I assumed group coverage could be underwritten on guaranteed issue basis. My only issue was recommending this as only option if it wasn't guaranteed issued.

These days Self Insured Plans do pay higher comp than traditional group plans... so take that FMO recommendation with a grain of salt. If those employees are still Medicaid eligible, then self-funding might not look so great. The more you have participating the better it is usually.

Why not just contact your regional Blues office and get a quote? Do you have a census?