Specific Excess Loss and Aggregate Excess Loss coverage is the traditional way to finance and limit risk for a Plan Sponsor within a self-funded ERISA plan.

The benefits of Specific and Aggregate Excess Loss coverage:

• Absolute Control of Plan Design:
  Allows employers complete flexibility, within the confines of the new health care reform laws, in determining the appropriate plan design or designs needed to best meet the needs of both the employer and employees.  In future plan years, available utilization data will allow modifications to the plan(s) to further maximize value.
• Costly Mandatory Benefits may be Avoided:
  Since state regulations do not apply an employer may avoid costly mandated benefits in their plan(s).
• Administration Tailored to the Employer’s Needs:
  Flexible administrative services simplify employer involvement in plan administration.
• Lower Cost of Operation:
  Lower administrative cost means that more of each premium dollar paid is available to pay valuable benefits to employees, not profits to insurance companies.
• Greatly Reduced State Premium Taxes:
  All insurance premiums are subject to full premium taxes by states. Self-funded plans reduce these taxes significantly.
• Real Claim Management:
  Claims are managed by experienced professionals based upon the provisions determined by the employer.  The Entrust claim adjudication system (EnCore) was specifically designed to provide maximum customer service.  Claim information and evaluation is available and routinely provided to employer plan sponsors enabling them to determine value for dollars spent. 

Claim Funding and Payment

The plan cost of Specific and Aggregate funding is guaranteed by the participation of an insurance carrier who provides stop-loss coverage. During the course of the plan year, the employer’s has the option to fund their account in the following ways:                                                                                         

• Fund to the maximum: The total amount of the maximum projected cost is deposited to the trust every month.
• Fund to expected: The  total amount of the expected cost is deposited to the trust every month.
• Fund as needed: The total amount of administrative fees and premium is deposited to the trust; claims are funded when presented for payment.

At the end of the plan year, if the claim reserve is not depleted by paid claims, any dollars left are retained by the plan.  They can be applied to the cost of the next year’s health benefit plan or used to pay for or fund medical insurance programs or expenses for employees.