Graded Funding offers a self-funded insurance model with stop-loss protection for employers with 50+ full-time employees. Graded Funding employers pay claims as they occur, giving them flexibility in managing costs. Stop-loss protection limits financial risk. Level Funding employers pay a fixed monthly amount (funding to the max), with the potential to get some money back (often 50% of the surplus) if claims are lower than expected—usually only upon renewal.
Graded Funding – The Breakdown…..
How It Works:
• No payment in the first month, allowing smoother cash flow during the transition.
• Clients pay a fixed monthly cost plus actual claims, up to stop-loss thresholds.
• If claims are low, clients immediately benefit from lower costs and retain unused claim dollars for future use or savings.
Key Advantages:
• Stop-Loss Protection – Includes both individual and aggregate coverage.
• Cash Flow Benefits – No waiting for stop-loss reimbursements.
• Cost Savings – Reduced premium tax and Health Insurance Industry Fee (PPACA) compared to traditional plans.
• Transparency – Access to monthly client-specific reports to track spending.
• Flexible Plan Design – Customizable benefits and stop-loss levels to fit company needs.
Flexibility:
• Adjust Risk & Reward – Flexible individual stop-loss limits allow companies to choose the best fit.
• Plan Design Freedom – Available with traditional or account-based plans, with the ability to make benefit changes throughout the year.
Control:
• Fully Integrated Stop-Loss Protection – Individual stop-loss insurance immediately covers high-cost claims exceeding the individual stop-loss limit.
• Aggregate stop-loss with monthly accommodation protects against excessive total plan claims.
• Paired with Health & Wellness Programs – Helps further control costs and increase claim savings, with reporting capabilities demonstrating results.
Ideal for Employers Who:
• Understand Level Funding and have a desire to take the next step
• Want to retain 100% of unused claim dollars while accepting the associated risks.
This model provides financial flexibility, insurance protection, and cost control, making it a strong option for employers looking for a tailored, self-funded healthcare plan.
Jack Silberman, CEO Silberman Group
