While there may be some parallels, the Health Plan Consortium is not a captive. It is a unique funding arrangement that combines the best elements of self-funding, fully insured, level funding, and captives.
Case Study: Consortium vs. Captive
Is a reduction in renewal rate enough to keep one group from leaving their current captive arrangement?
- 121 enrolled employees located in the Southeastern US
- Received a renewal projection of just less than 1% from their captive
Even with a renewal decrease, the group decided to leave the captive and join the consortium because:
- Stop loss premium was $267,868 less with the consortium
- Max funding was $604,416 less with the consortium
- Captive had a 125% funding corridor vs. consortium corridor of 110%
- Expected savings in the consortium of $489,056 vs. the captive
- The consortium has no reserve requirement and no capitalization requirement
Additionally with the consortium:
- Future renewals are capped
- No new lasers
- Groups can’t be terminated for poor claim performance
- Consultants can choose their own cost containment solutions and are no longer beholden to the captive’s requirements
Want more control?
The UBA Health plan Consortium brings greater transparency and cost savings to employer-sponsored health insurance plans. By putting numerous safety measures in place, the Consortium allows employers to self-fund their plan in a way that protects them in a bad year but provides significant upside through surplus retention in the years that the plan is running well. This program allows employers to take back control from the insurance carriers, provide a great benefit for their employees, and still only pay for what they use.
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