Grinspec - Employee Benefits Consulting in NJ

	Our Expertise
Employee Benefits:
	Special Involvement
	A-4 Surcharge
	SHBP Updates
Medical Insurance:
	Carriers in the Marketplace
	Self Insurance & HIFs
	Fully Insured Trusts
	How to Obtain a Quote
Property & Casualty:
	Coverage Needs Analysis
	Info Needed to Obtain Quotation

FINANCIAL TEST GUIDE

1.	Administrative Costs:	You should request the rating basis (dollars per insured employee and dollars per paid claim, etc.) that generates the total administrative costs.
2.	Aggregate Umbrella Costs:	You should require both the rate and maximum attachment point (trigger) be guaranteed for the 2nd year.
3.	Aggregate Claim Maximum:	The 2nd year maximum is very important to have guaranteed. Normally the aggregate claim maximum in a self-insurance plan includes a 25% margin over expected claims. If you do not have a guaranteed aggregate in the second year, you may experience a significant cost increase over the previous year.
4.	Individual Stop-Loss Umbrella Costs:	You should require both the rate and maximum attachment point (trigger) guaranteed for the 2nd year.
5.	Other Administrative Costs:	Items that are normally supplied by an insurance company are often an additional cost with self-insurance.
6.	Claim Access Charge:	This is generally expressed as a fee per employee or a percent of savings from network discounts. This is an expensive item, especially if it's based as a percent of network discount savings.
Frequently, self-insurance and HIF proposals do not address all of the costs you would be required to pay. A proper comparison can only be made after all costs have been identified.

FINANCIAL TEST
FOR SELF INSURANCE AND HIF PLANS

1st Year 2nd Year Current Plan

1.

Administrative Costs

$

$

Items 1-7 are all included in your insured plan.

2.

Aggregate Umbrella Cost

$

$

3.

Aggregate Claim Maximum

$

$

4.

Individual Stop-Loss Umbrella Specified Amount (...)

$

$

5.

Other administrative costs such as printing of booklets, ID cards, claim forms/envelopes, contracts, set up fee, etc.

$

$

6.

Claim access charges for hospital and physician discounts.

$

$

7.

Reserves (25% of aggregate claim maximum) for first year only, adjust for second year to 25% of 2nd year aggregate maximum.

$

$

8.

Total maximum cost GUARANTEED

$

$

$

Note: Make sure any HIF of Self-Insured proposal enumerates all of the above listed costs.