Alternate Funding Options

Which plan is right for your company?

Saxon is here to help you.

The decision of what funding option suits you best is based on the statistical viability or predictable nature of your claims, but it is important to understand the various points across the broad funding continuum.

Click the button below to launch our quick and easy assessment and soon you will discover the plan that best fits your company.
Discover the Best Plan For You.

Once you determine the best plan for your company, the next step is deciphering how to pay for your new benefits.

At Saxon, we help our clients fully analyze all options across the funding continuum and decide on the best fit for them.

Under a fully insured plan, risks are passed onto the carrier who charges a flat monthly fee based on how they gauge the risk of insuring employees. If employees rarely use the insurance, the flat monthly rate still must be paid no matter what. If covered employees experience health issues and use the plan more, monthly premiums can rise significantly at renewal. Although it provides no monthly price fluctuations, this model tends to not provide any meaningful incentive for having healthy employees.

A business on a self-funded plan pays the actual claims and essentially assumes the role of the insurance carrier in terms of managing risk. Self-insured plans are common for large companies because they have a large pool of covered employees and the cash reserves to protect against a spike in claims volume or amount. Small businesses on the other hand typically have less cash on hand and can’t weather a dramatic increase in costs as easily.

level-funded plan is an option that falls between fully insured plans and self-insured plans. Level Funding plans essentially allow a business to self-insure but pay a level or steady fee each month as determined by a TPA. Level-funded plans are also integrated with individual and aggregate stop-loss insurance. Level Funding is ideal for employers with 25 or more healthy employees who have cultivated a culture of wellness and engagement.

For more information on our funding options or to take an over-the-phone assessment, call +1 (513) 573-0129 or email our Alternative Funding Agents at to schedule an in-person appointment.

When armed with the proper knowledge, you are empowered to accurately predict your own claims.

Benefits of Level Funding:

A level funded plan with Saxon allows employers to design the best plan to suit employee’s needs and company objectives. This affords you the ability to contract with the providers, provider networks, and Pharmacy and Care Managers that meet your targeted needs. Level funded plans are also exempt from state insurance laws that typically mandate certain benefits for insured plans.

Saxon understands that an off-the-shelf product isn’t for everyone. Level funding allows plan customization to meet the specific healthcare needs of your workplace.

The improved cash flow an employer can experience with a level funded plan results from not having to pre-pay coverage. Employers can use this improved cash flow to their strategic advantage.

The level funded employer maintains control over the health plan reserves, enabling maximization of interest income – income that would be otherwise generated by an insurance carrier through the investment of premium dollars.

Level funded plans are exempt from state insurance laws that typically mandate certain benefits for insured plans. Additionally, these types of plans are not subject to state health insurance premium taxes, which can be 2-6 percent of the premium’s dollar value.

Level Funded Plans are regulated under federal ERISA (Employee Retirement Income Security Act of 1974) law and therefore are not subject to conflicting state health insurance regulations and benefit mandates.

This consumer-protection & transparency law allows the employer the most control over their plan costs. Instead of leftover money or savings going to the insurance company, level funding allows any unspent money to remain as plan assets for future costs.

Why Level Funding Works:

When actual claims are less than projected, the company receives a credit – this is money back directly.

Monthly costs are based on the number of covered employees and cover all claims, premiums and fees.

There are no additional expenses after termination, so you know your all costs up front.

Every client has direct access to reports that track exactly how claims dollars are being spent.

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Frequently Asked Questions:

Companies with fewer than 250 employees are often afraid that they will be exposed to too much risk with a self-funded plan. However, smaller companies can still afford to be self-funded because they can purchase stop-loss insurance, which limits the amount of claims expenses an employer would be liable for, per covered employee, per year. This protects a company against some sort of catastrophic event involving one or more employees.

This is where level-funded plans come in.

Level-funded plans are essentially pre-packaged self-insured health plans, with low attachment stop-loss coverage for groups as small as 10 employees. For the right groups, level-funded plans can save 30 percent versus a fully insured ACA small-group plan.

The biggest single risk to any organization with a self-funded plan is that the health plan’s expenditures could end up higher than anticipated when you established your basic funding level or premium.

Specific stop-loss insurance limits an employer’s financial exposure when health claims for a specific individual exceed a specific dollar limit within a plan year.

This is where stop-loss insurance comes in.

Stop loss does exactly what it says by stopping the loss to the plan or employer if claims run unexpectedly high. TPAs are very familiar with stop-loss providers and work closely with them. They often arrange stop-loss on behalf of the plan or employer to ensure smooth coordination of the plan’s operation.

The TPA is a hired outside firm skilled in the day-to-day duties of operating a health plan. Thus, the TPA role is much CPA firms or other types of experts who are hired to provide duties in a specific area on an ongoing basis.

A TPA walks employers/plan sponsors through the process and performs any number of plan functions under the instruction or approval of the employer/plan sponsor. Just as an employer can choose which benefits to cover, the employer can also decide which duties it wants its TPA to manage. Main duties can include assisting with claims management and plan enrollment to offering support with reporting requirements and plan document coordination.

The plan sponsor is always ultimately in charge of a self-funded plan just like the taxpayer is always responsible when a professional preparer does one’s taxes.

ERISA was designed to be the ultimate consumer (employee) protection law, making fiduciary, reporting and other responsibilities stricter and more closely monitored than in normal business practices and insurance company laws. In short, everyone who has discretionary authority impacting the plan assets or beneficiaries is expected to perform and make decisions that are “prudent” (a key ERISA measure of fiduciary duty) for the plan and provide the promised benefits. ERISA is mainly regulated by the U.S. Department of Labor (DOL), which judges actions of those running the plan on a case-by-case basis. This protects the plan, the employer and the beneficiaries.

Let us help you discover the plan that fits your needs.