A self-insured health plan is just one of the many options that an employer can choose when deciding how to provide health insurance for their employees. Unlike other types of group policies, under a self-insured health plan, the employer is the one who is accepting the financial risks for insuring employees medical bills. The employer essentially becomes the insurance company.
There are a few reasons why a business would choose this type of plan over others, but the main factor is usually cost. It costs less to manage a self-insured policy than it does to enter fully into a contract with a larger provider.
There are many differences in how a self-insured health plan is run, and employees covered in this way need to be very active in educating themselves on exactly how the plan is managed. While the plans are Federally regulated by the Employee Retirement Income Security Act (ERISA), exact details can vary from company to company.
Fortunately, ERISA requires that any business providing this type of insurance make available a Summary Plan Description (SPD). The SPD is a document that will lay out all of the guidelines and processes that you can follow in order to utilize your health benefits.
You may also want to make sure you find out who your plan administrator is. This would be the person who manages the daily operations of the health plan. Though some services are usually outsourced to third-party companies, the administrator should be a person you can go to with questions, concerns or problems.
The most important thing to understand about a self-insured health plan is that it is not regulated or policed by the state insurance agencies. It is regulated by the Department of Labor. If you have a serious medical claim that is denied, you will need to use the appeals process set up by your employer. If this process fails to provide satisfactory results, then you will need to directly contact the Department of Labor.
The billing practices may also be different from company to company. Some employers may ask that you pay your entire medical bill upfront, and then submit the receipts for reimbursement later. Others may pay only part of the fees. Be sure and fully understand how this process works.
If you are covered by a self-insured health plan, make sure that you read your SPD from cover to cover, know who your plan administrator is, and ask questions when necessary. Remember that you are largely responsible for knowing how your health insurance coverage works.
Source by Jackie Jones