Businessolver Blog

When it Comes to Pooled Health Benefits, There’s Strength in Numbers

When it Comes to Pooled Health Benefits, There’s Strength in Numbers
Posted on Friday, June 1, 2018 by Seth Hall

Industry experts working with pooled insurance groups agree that maintaining financial stability while growing membership is vital to continued success. But, this isn’t always easy to achieve.

Swim-Sink Blog Image-1Historically, there have been some well-publicized failures of self-funded plans and other pooled arrangements, which has colored public perception. Reading comments on proposed regulations to expand association health plans in term of who can band together to purchase health insurance, it becomes clear that, in some quarters, people are still concerned about both solvency and the adequacy of coverage.

However, there are many highly successful, fiscally rock-solid pooled groups, some of which have been in existence for decades. They serve thousands of satisfied organizations and millions of members across the US—among them are groups and individuals who may not have access to affordable healthcare elsewhere.

What do these top-tier pooled groups have in common? They all employ a best-practice approach to managing and growing their pool.

Here are three of their tried-and-true techniques to maintaining a happy and healthy group:

  1. They provide concierge services. The strongest pools have their members’ best interests at heart, and they show it. They provide personal service, and they are knowledgeable about and involved in their members’ associations. This helps them better understand the needs of the member organizations, and it promotes and underpins the long-term relationships that ensure success and a growing member base. Ensuring members understand the value of participating in a pooled group prevents price shopping and turnover.

  2. They have great member fit. Finding the right member organizations helps promote stability, because the better the fit, the more likely groups are to be in it for the long haul. When organizations pool-hop on price, that undermines both stability and growth. Also important is balance. Groups that rely too heavily on one large employer can be negatively impacted if that large group leaves. 

    The concept of fit also applies to a group’s board. It’s important to choose people who understand the cooperative nature of a pooled group and are willing to act in the best interest of all stakeholders. 

  3. They manage plans for cost containment. Since price is a primary factor driving organizations to participate in a pool, successful groups keep a keen eye on cost with an aggressive risk management plan. This can include controls such as mandatory generics, quantity limits and prior authorization for pharmacy benefits, as well as steerage toward better-outcome providers on the medical side, as an example. 

    Another key cost-containment approach is to partner with high-quality vendors that provide deep discounts and performance guarantees and that have the proven ability to deliver.

With new proposed regulations potentially expanding the definition of who can form an association, there could be significant growth in the pooled insurance market in the coming years. For smaller employers and individuals without access to affordable coverage, this could be a new point of entry into gaining health insurance.

Want to know more about how stable, successful pooled groups are able to offer high-quality service, market-leading administration and access to affordable benefit options to smaller organizations? Check out our webinar.