Issue link: https://www.e-digitaleditions.com/i/276151
[ 44 ] HRO TODAY MAGAZINE | MARCH 2014 A New Benefits Paradigm Self-insurance may be the answer to avoiding the costly impact of healthcare reform. By Joseph Berardo Jr . The Benefits Package Making decisions about employee benefits is demanding even during the best of times, but now that Affordable Care Act (ACA) implementation is upon us, the task has become that much more challenging. The ACA has significantly complicated the question of how to offer health benefits due to cost and complexity, prompting HR professionals to seek alternative solutions. Self-insurance has emerged as another approach to traditional insurance plans. With a self-insured health plan, employers pay for individual employee health claims out of cash flow rather than as a monthly fixed premium to a health insurance carrier. While employers assume the direct risk for payment of claims, costs are based on actual plan member healthcare use, and catastrophic claims are covered by stop-loss coverage. Stop-loss insurance provides protection against unpredictable losses. It is purchased by employers who have decided to self-insure, but do not want to assume 100 percent of the liability for losses arising from the plans. Under a stop-loss policy, the insurance company becomes liable for losses that exceed certain limits. Self-Insuring in the Age of Reform The ACA health insurance tax of 2014 is expected to increase the cost of healthcare coverage for employers relying