Blue Balance Funded℠ Product Brings Self-Funding Option to Small Employer Market
Many employers invest significantly – in both dollars and time – in programs to help their employees get and stay healthy. When their efforts are successful, employers see the results in happier employees, increased productivity, and – most of the time – a reduction in the amount of money they spend on their employee health care plans.
That is, unless the business is a small employer, defined by the Affordable Care Act (ACA) as employing between 1 and 50 employees.
Unlike in the large group arena, premiums for small employers are determined based on only a few factors – like the age of employees and the location of the employer – due to ACA regulations. Even if a small employer has invested heavily in wellness programs and seen positive results, those results will not be factored into their health insurance premiums.
To solve this problem, Blue Cross and Blue Shield of Montana (BCBSMT) launched Blue Balance Funded, a new product designed to give small employers the same benefits enjoyed by larger, self-funded employers.
“Our balance-funded product gives small employers the predictability of being fully insured, with much of the financial upside of being self-funded,” said Corey Palmer, Senior Manager of Sales Strategy for BCBSMT.
Our balance-funded product gives small employers the predictability of being fully insured, with much of the financial upside of being self-funded.
Most large employers elect to “self-fund” their employee health plans, meaning they take on more of the risk for paying for employee health care expenses and reap the rewards when health care costs are lower. These kinds of plans are generally too unpredictable for small employers, as large cash reserves are required to pay for unexpected large claims.
Blue Balance Funded provides a solution. BCBSMT calculates the likely health care spending for the employer for the upcoming year. Blue Balance Funded then factors in the cost for those projected claims, including building a reserve, as well as administrative fees and stop-loss coverage premiums to protect the business from high-cost claims.
Employers pay their maximum possible liability up front each month – and receive credit back at the end of the year if actual claims are less than the projected claims funding. If it turns out claims cost more than expected, the employer is protected from additional liability by the stop-loss policy.
“It’s a great option for many employers because, at worst, you come out even at the end of the year,” Palmer said. “But if you spend less than expected, you’re getting money back.”
Employers who choose the Blue Balance Funded plan also have access to Blue InsightSM. This dynamic reporting feature provides groups with updated monthly reports and profiles, helping them identify utilization trends and costs within their group. The plan includes pharmacy benefits, biometric screening, fitness programs, the Blue365 member discount program and the BlueCard® national provider network program. Health and wellness features are also included.
Blue Balance Funded
To find out more about BCBSMT’s balance-funded product for small businesses, go to bcbsmt.com or visit with your health benefits consultant today.