Underwriting Results of a Mid-Size Self-Funded Health Plan
Amazing things can happen when you pay attention. The graph above illustrates the results one can expect when a self-funded plan sponsor replaces an insurance consultant who wasn’t paying attention with one who does.
In this case this 800-member group hired a new fee-based insurance consultant January 1, 2025, replacing the prior consultant who was earning both fees and commissions off a bankrupt health plan.
It took the succeeding consultant five minutes to find a solution. It took the plan sponsor 60 days to implement it. The results were immediate.
The reduction in the plan’s paid loss ratio shown above was not the result of changing benefit design or applying Magic Dust. It was the result of something else. Something basic.
Enforcement of Plan Document language and synchronization of vendor contracts is essential. All must be interlaced, meshed. When one contradicts the other problems will inevitably arise placing both plan sponsor and plan members at unnecessary risk. This was the case in this instance.
The group’s return on investment to date has proven out by way of a Charles Proteus Steinmetz factor of +10 powered by a strongly held belief that “There’s no such thing as an unsolved problem.”
“There’s still more work to be done,” says the new consultant. “Smarter consumer shopping for health care services will have a significant impact.”
Business is about solving other people’s problems. Solving the high cost of healthcare giving employers a competitive advantage is ours.
Status quo convergent thinking solves problems through a very narrow lens. Divergent thinking empowers us to solve problems with a wide lens allowing us to see what others don’t.
You can’t fix what you don’t see. You don’t know what you don’t know. We see opportunities others miss. We do what others don’t. Winning together is our goal.
