Independent Risk Management Services For Self-Funded Health & Welfare Plans Service Schedule is flexible, allowing plan sponsors to pick and choose the level of service required.

Tier 1 services are designed for those plan sponsors who want an independent review of contracts and administrative functions to identify potential liabilities with remedies. This is an important first step in proper risk management. We have found that most plan sponsors have never had an independent third party to review plan documents. This is a short term contract.

“We review tens of thousands of plan documents per year; the bottom line is that roughly a third of these plan documents aren’t in legal compliance and over 80% need some serious cost containment language in order to keep the self-funded plan one claim away from blowing up. Why is that? Is it laziness, ignorance, or are all these rules just complicated when it comes to health benefits? “- Adam Russo, Attorney

Tier 2 services enhanced Tier 1 services – financial review with forecasting. This critical element forms the foundation upon which comprehensive risk management services are based within the industry. Without an actuarial analysis a plan sponsor cannot be certain recommended risk management strategies will produce anticipated results. In addition, focus group findings will assist, in part, in determining risk management strategies in line with specific plan members needs and goals. This is a short term contract.

“Actuarial attention is directed to the following areas: (1) The benefit structure should be sound, (2) The contributions levels should be reasonable and adequate, (3) Adequate reserves should be calculated and maintained, (4) The level of self-funding should be reasonable when tested against risk theory.”

The role of the actuary is not promotional nor adversarial. Rather, the actuary is a presenter of facts. The facts are that self-funding financial outcomes will vary from year to year due to (1) Judgement errors, (2) secular trends, and (3) Random statistical fluctuations.”- Carlton Harker, Society of Actuaries

Tier 3 services are all encompassing, including performance / value-based fee structure. All services are intended to assist the plan sponsor towards full compliance of mutually shared fiduciary duties. This is a long term contract.

All benefits leaders and their consultants should be overhauling how they manage care and cost, or risk the consequences. It’s particularly notable that the Department of Labor is now arguing that fiduciary dereliction in health benefits is rampant “- Brian Klepper, Phd