Stop Loss Insurance Buy Insurance to cover real risks Stop Loss is a pooled insurance policy to control catastrophic costs in an ASO plan. Like Capping, stop loss has employer specified ceilings; however, in this case claims that exceed these ceilings are covered by stop loss insurance. These limits can range from $5000 to $25,000 or more and can be instaled on either a per-employee basis or on an aggrigate basis. Purchasing this coverage effectively removes catastrophic risk from a health benefit plan. Remember, only about 10% of claims fall outside of the predictable range. Insuring the unpredictable and budgeting for the remaining predictable claims makes sense. Predictable claims are managed and supported by a self-funded employer program. If you currently pay Stop Loss inside a Premium Plan you may be insuring the carrier's profit rather than controlling your costs Alternatively, a company may use a capping method to determine in advance the highest claims level their self funding program will support. |
