Finally get that promotion? Get exclusive content, tips and tools to help you excel.
Implicit bias occurs when individuals make judgments about people based on gender, race or other prohibited factors without even realizing they’re doing it.
Is your employee handbook keeping up with the changing world of work? With SHRM's Employee Handbook Builder get peace of mind that your handbook is up-to-date.
Build competencies, establish credibility and advance your career—while earning PDCs—at SHRM Seminars in 12 cities across the U.S. this spring.
#SHRM18 will expand your perspective – on your organization, on your career, and on the way you approach HR. Join us in Chicago June 17-20, 2018
Members may download one copy of our sample forms and templates for your personal use within your organization. Please note that all such forms and policies should be reviewed by your legal counsel for compliance with applicable law, and should be modified to suit your organization’s culture, industry, and practices. Neither members nor non-members may reproduce such samples in any other way (e.g., to republish in a book or use for a commercial purpose) without SHRM’s permission. To request permission for specific items, click on the “reuse permissions” button on the page where you find the item.
The percentage of U.S. workers in private-sector self-insured health plans has been increasing. In 2011, 58.5 percent of workers with employer-provided health coverage were in self-insured plans, up from 40.9 percent in 1998, according to a November 2012
report on the prevalence of self-insured plans by the not-for-profit Employee Benefit Research Institute (EBRI).
With a self-insured plan, the employer assumes most of the financial risk related to health insurance, often securing stop-loss coverage from an insurer only to cover unexpectedly large or catastrophic claims; the plan is managed by a third-party administrator, typically an insurance company.
With a fully insured plan, an insurer is paid to assume the risk, as well as manage the plan.
Historically, large employers have been far more likely to self-insure than have been small employers, the EBRI report noted, and there are significant incentives for them to do so: Large multistate employers can provide uniform health benefits across state lines if they self-insure (lowering administrative costs) and are not required to cover state-mandated health care services—as are fully insured plans.
To date, large employers (with 1,000 or more workers) have driven the upward trend in overall self-insurance. The percentage of workers in self-insured plans in firms with fewer than 50 employees has remained close to 12 percent in most years examined.
(click on graph for larger view)
Impact of Health Care Reform
Following the passage and implementation of the Patient Protection and Affordable Care Act (PPACA), there has been speculation that an increasing number of smaller employers would opt for self-insurance. One reason is a widespread presumption among employers that the PPACA’s coverage requirements, and the new taxes the statute imposes, will work to drive up the cost of health coverage. “Employers generally, and small employers particularly, are concerned about the rising cost of providing health coverage and may view self-insurance as a better way to control expected cost increases,” noted Paul Fronstin, director of EBRI’s health research and education program.
Massachusetts as Bellwether
Massachusetts, the only state to have enacted health reform similar to the PPACA, has seen an increase in the percentage of workers in self-insured plans among all firm-size cohorts, except among workers in firms with fewer than 50 employees. Overall, 73.8 percent of workers in Massachusetts were in self-insured plans in 2011, the highest rate in the nation.
Since 2006, when Massachusetts passed its health care reform law, the percentage of workers statewide in self-insured plans has increased as follows:
If Massachusetts proves to be a model for the nation, more employers will shift to self-funding as health care reform is implemented.
is an online editor/manager for SHRM.
Related SHRM Articles:
Health Care Reform Resource Page
• Keep up with the latest news. Sign up for SHRM’s free
Compensation & Benefits e-newsletter
You have successfully saved this page as a bookmark.
Please confirm that you want to proceed with deleting bookmark.
You have successfully removed bookmark.
Please log in as a SHRM member before saving bookmarks.
Please sign in as a SHRM member before saving bookmarks.
Please purchase a SHRM membership before saving bookmarks.
An error has occurred
Recommended for you
HR Education in a City Near You
SHRM’s HR Vendor Directory contains over 3,200 companies