Consistent Funding from BPS is an innovative Level Funding health benefit solution designed for small groups with at least 25 covered employees. Consistent Funding features stop-loss insurance protection that provides the same security and predictability as a fully-insured benefit plan – but leverages the advantages, control, customization and optimization of self-funding.
The employer makes a consistent monthly payment that is similar to a traditional premium without all of the unnecessary costs loaded into a fully-insured plan. The program features aggregate stop-loss insurance protection that covers unexpected claims frequency or catastrophic claims from day one, fully protecting the employer's investment by capping the claims liability.
The employer's benefit investment performs to its greatest potential, paying medical expenses as they occur. At the end of the plan period, the employer will utilize any remaining claims fund balance to offset future medical benefit payments.
How Consistent Funding Works – There are two types of aggregate stop-loss insurance available:
Provides coverage for a 12 month policy period with terminal liability insurance covering claims submitted after the end of the policy in the event of termination.
Provides coverage for a 12/18 policy period, which covers claims incurred during a 12 month policy period that are submitted within 6 months after a policy period has ended. This coverage does not require the group to further fund premiums or paid claims in the event of termination.
The table illustrates how Consistent Funding works with stop-loss insurance for a 12/18 policy period. The example assumes a plan will cover 50 employees and 25 dependents each month during the policy year. After the 12 month policy period has ended, a six month run-out period acts as a buffer to pay any outstanding claims that may remain. Since the paid claims of $141,332.00 was less than the total funded claims limit of $180,000.00, the employer will be able to utilize the remaining balance of $38,668.00 for future medical benefit payments.