Financial and Funding Analysis
In order to maintain control over your benefit plan costs we advocate
the ongoing review of factors affecting the financial status of employer
sponsored plans. Periodic evaluation of cumulative claims experience,
shock claims and medical trends are essential to the proper financial
management of a benefits program. This approach facilitates control over
your benefit costs and allows for timely response to anticipated losses
and rate adjustments. The process consists of careful analysis of the
following:
- Renewals: Evaluate current proposed renewals as provided by insurance carriers. Negotiate the proposed rates with carriers after analyzing current experience, current retention costs and prior year's financial summaries. Prepare cost projections based upon expected trends in health care expenses, inflation and other pertinent data.
- Plan Costs: Analyze current plan design and associated cost structure. Illustrate the impact of cost shifting through plan design and contribution strategies.
- Funding Arrangements: Evaluate other cost funding methods based on level of risk employer is willing to accept and their ability to reduce cost.
- Ongoing Cost Projections: Evaluate claims experience on a quarterly basis, adjusting for credibility. Project claim and funding levels for the remainder of the plan year. Project renewal rate adjustment for budgetary purposes.
- Year-End Accounting: Review policy year financial summaries for complete cost breakdown. Evaluate reserve levels, retention components and effectiveness of funding arrangement.