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Health Plan Differences: Understanding Self-Funded vs. Fully Insured

For companies that must deal with how best to handle health insurance costs, a decision needs to be made on whether they choose to be fully insured or self-insured. Use this infographic to compare and contrast the main differences of each plan to determine the best fit for your company.


The employer does not pay premiums; instead, it pays fixed cost (administrative fees and stop loss premiums) and variable costs (employee health care claims) PAYMENTS The employer pays monthly premiums to an insurance carrier.
The employer assumes the risk. ASSUMPTION OF RISK The insurance company assumes the risk.
Employers have more control and freedom in their plan designs. PLAN DESIGN Employers are more limited by insurers' plan design options.
The Employee Retirement Income Security Acts of 1974 (ERISA) pre-empts state regulations. COMPLIANCE PAYMENTS The plan most comply with state regulations.