How is a self-funded plan different from a fully insured plan?
Under a self-insured plan, the employer pays administrative charges to a third party administrator (TPA) who pays claims out of employer funds, administering the Plan according to the Plan Document, which is developed by the employer and the TPA. With fully insured plans, the employer pays a premium to an insurance company, and the insurance company pays claims out of the premiums it collects for every member it insures, regardless of claim activity.

A common misunderstanding about self-funding is that there is additional liability or risk. However, self-funded plans allow employers to set aside dollars to fund claims, retaining the profits that would otherwise go to an insurance company. These funds can then earn interest until needed to pay claims, saving money over years with low to average claims activity.

Additionally, a self-funded plan provides employers more flexibility to customize benefits, allows access to claims data on a monthly basis to determine program performance, and offers availability of coverage in markets that may not otherwise have competitive choices.

What are usual and customary charges?
Usual - A charge is considered “usual,” if it is a physician’s common charge for a procedure.

Customary - A charge is considered “customary,” if it is within a range of fees that most physicians in the area charge for a given procedure (often measured at a specific percentile of all charges submitted for a given procedure in that community).

At JI, we

• Analyze and match networks to provide our clients with negotiated rates from physicians and facilities. This solution maximizes physician and facility availability and minimizes provider disruption. If you visit an in-network provider, usual and customary does not apply.



• Load a fee schedule into our claims administration system and integrate it within the claims adjudication process to calculate out-of-network charges. We process provider charges for eligible out-of-network claims at the 75th percentile level of usual and customary. 75th percentile means that 75% of all billed charges compiled for that particular procedure were at or below that charge amount.
  
  

  For example, if an out-of-network doctor charges $1,100 for a certain procedure and your plan pays 75% of usual and customary (which your health plan determines to be $1,000), then your employee would pay 25% of $1,000 ($250), plus the $100 over the usual and customary for a total of $350.

Immigration: A Closer Look
A member’s dependent is an undocumented immigrant and is deported to his native country. Is this person still covered under the group health plan should he need medical treatment?

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