As an employer, providing your employees with high-quality health insurance is an important part of ensuring their overall well-being and satisfaction with their job. However, finding the right health plan that fits your budget can be challenging. That’s where Aetna level-funded plans come in.
Level-funded health plans allow employers to maintain predictable and affordable healthcare costs while giving their employees access to the healthcare services they need. With Aetna’s level-funded solutions, employers can cut costs without sacrificing the quality of their employee benefits packages.
Here’s a closer look at everything you need to know about Aetna level-funded health plans.
What are Level-Funded Health Plans?
Level-funded health plans, also known as level-funded insurance or level premium insurance, are a type of health plan funding that provides employers with the benefits of self-insurance without the financial risk.
With a level-funded plan, employers pay a fixed monthly premium to a third-party administrator to cover their employees’ medical claims. The plan administrator then pays for all claims up to a certain amount, which is known as the “specific stop-loss limit.” Any claims exceeding this limit are paid by the insurance carrier, providing employers with financial protection against catastrophic claims.
If your actual claim costs are less than expected, you may be eligible to receive a refund or plan credits equal to the unused amount that you paid into your claims fund. If your claim costs are more than expected, your stop-loss insurance premiums will increase.
Other Types of Health Plan Funding
Other types of health plan funding include fully insured plans and self-insured plans. With a fully insured plan, employers pay a fixed monthly premium to an insurance carrier, who assumes all financial risk and pays for all medical claims. With a self-insured plan, employers assume all financial risk and pay for their employees’ medical claims directly.
Level-funded plans offer a middle ground between fully insured and self-insured plans, providing employers more control over their healthcare costs while offering financial protection against catastrophic claims.
Level-Funded Health Plan Benefits
Level-funded health plans are an exceptional option for small businesses that need affordable healthcare solutions. These plans can help employers save money while still being able to offer comprehensive health coverage to their team members.
There are several benefits to choosing a level-funded health plan for your employees, including:
Predictable Monthly Payments
With a level-funded plan, employers pay a fixed monthly premium, which makes budgeting for healthcare costs more predictable. This can be especially beneficial for small businesses or those with fluctuating revenue.
Level-funded plans offer stop-loss protection, meaning employers are protected against catastrophic claims. This can help prevent financial ruin in the event of a large medical claim. This also ensures that a single claim doesn’t drain your claims fund.
If claims are lower than expected, employers may be eligible for a refund of a portion of their premiums. This can provide a valuable cost savings opportunity for businesses. With these refund opportunities, employers only end up paying for the coverage that their employees actually use.
Aetna Funding Advantage Health Care Plan
Aetna offers a level-funded health plan called Aetna Funding Advantage (AFA). AFA is designed for small to mid-sized businesses (2-100 employees) and offers a range of benefits, including:
- Predictable monthly payments
- Stop-loss protection
- Refund opportunities
- Access to Aetna’s broad network of healthcare providers
- Wellness programs and resources to help employees stay healthy and prevent costly medical claims
AFA also includes an integrated pharmacy benefit, which provides employees with access to prescription drugs at a lower cost.
Aetna Funding Advantage Participation & Contribution Minimums
To be eligible for AFA, employers must have at least 10 eligible employees, and at least 50% of eligible employees must enroll in the plan. The minimum employer contribution is 50% of the total employee premium, and the maximum employer contribution is 100% of the total employee premium.
Request a Quote
Aetna level-funded health plans offer an ideal solution for employers that want to build competitive benefits packages. These plans offer great cost-saving opportunities, predictable monthly payments, and various other benefits for both employers and their employees.
At KSA Insurance, we work with employers in South Carolina and across the southeastern United States to help them choose affordable health insurance policies that offer comprehensive coverage to their employees and help them create competitive benefits packages.
Contact us today to get a quote and learn more about level-funded health insurance plans for employers.