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MedBen Stop-Loss Captive Offers Cost Savings Through Shared Risk

05/21/17

  11:11:00 pm, by MedBen5   , 252 words,  
Categories: Stop-loss, Cost savings, Third party administration, Captives

MedBen Stop-Loss Captive Offers Cost Savings Through Shared Risk

Jay Ritchie

The MedBen stop-loss captive save clients money while reducing financial risk, says Jay Ritchie, Executive Vice President of Tokio Marine HCC.

Speaking at the 2017 Employer Roundtable on May 11, Ritchie noted that the success of MedBen's captive is based on its straightforward design. "By keeping things simple and avoiding unnecessary costs and excessive fees, clients realize lower costs while still offering broad benefits."

A captive brings together employers with good claims experience to spread risk among multiple groups. In doing so, small to mid-sized businesses get the advantages of larger employers, including plan design flexibility, claims data transparency, and cost management.
A key to the captive is an added "captive layer" between the employer specific deductible and stop-loss coverage, in which a portion of the group’s collective stop-loss premium is held. Claims above the specific deductible are paid from this layer, and any funds remaining in it go back to the employers.

"Employers in the stop-loss captive use the captive layer as a shock absorber," Ritchie said. "This added layer translates to lower volatility in the stop-loss specific claim layer, which in turn lowers employer risk. And the captive's cost containment can reduce short and long term cost trends."

In addition to his position at Tokio Marine HCC, Ritchie also serves as Chairman of the Board for the Self-Insurance Institute of America (SIIA).

Employers interested in joining the MedBen stop-loss captive can do so at their current effective date. To learn more, contact Vice President of Sales & Marketing Brian Fargus at bfargus@medben.com.

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