Self Funded Platform:

Controlling Costs at Renewal

$1.7 MILLION +

Increased surplus retained from $0 to $1.7 million in one year

47%

Reduced claims spend by 47% over one year

$350K +

Saved more than $350,000 in claims through med & Rx intervention

The Situation

One of our broker partners successfully built a block of business by transitioning clients and prospects to a self-funded consortium.

The prior program lacked carrier and network transparency, claims management and cost containment features, leading to significant increases in medical stop-loss premiums for these groups, making self-funding unstable.

Crumdale worked to understand the current suite of vendors serving the group of accounts to identify improvements that could be implemented.

Goals

CLIENT:

Long-term strategy to control costs and stabilize the self-funded consortium.

BROKER:

Stabilize the self-funded consortium and achieve cost savings for the block.

Before & After

Before After
Program Structure Level Funded (12 equal payments at annual max cost) Level Funded (12 equal payments at annual max cost)
Third-Party Administrator (TPA) Hospital Owned TPA Independent TPA
Network Local TPA and Hospital Network National Network
Pharmacy Benefit Manager (PBM) TPA Provided Transparent PBM Contract
Medical Stop Loss Spread between different carriers Resolute Underwriting Strategies
Surplus None 100% Retained By Group
Claim Review & Monitoring None Franklin Health
Pharmacy Oversight None Franklin Health
Data Analytics None Franklin Health
Patient Assistance Programs (RX) None Franklin Health
Patient Advocacy / Engagement None Franklin Health
Plan Document Review None Franklin Health
ERISA Guidance & Support None Franklin Health
Compliance Review None Franklin Health

The Results

12 Months before Crumdale Partners 12 Months with Crumdale Partners
# of Employees 376 361
Aggregate Claims $2,789,041 $1,413,071
Claims, PEPY $7,418 $3,912
Surplus / (Deficit) ($5,847) $1,779,250

These groups received $1.7 Million + in surplus.

These groups increased the surplus they retained from $0 to $1,779,250 in just 1 year a 47% reduction in claims spend.

Pricing

FAVORABLE DISCOUNTS, TERMS, AND CONDITIONS

Stability

DECREASED RENEWAL VOLATILITY

Control

ALLOWS FOR STRATEGIC PLANNING & FINANCING

How We Did It

THE HOSPITAL-OWNED NETWORK AND TPA PREVIOUSLY IN PLACE WERE NOT PROPERLY ALIGNED WITH THE NEEDS OF EACH EMPLOYER GROUP OR THE BLOCK ITSELF.

The network was aligned with the TPA’s
owner, not the underlying employer groups

A PBM contract with zero transparency
towards prescription drug pricing

No claims management

Carrier retained all PBM rebates

No clinical integration

Little broker or client control

The network was aligned with the TPA’s
owner, not the underlying employer groups

A PBM contract with zero transparency
towards prescription drug pricing

No claims management

Carrier retained all PBM rebates

No clinical integration

Little broker or client control