Self-funding for employee health plans

In today's environment of increasing pressures to contain costs, hospital management is faced with the need to identify all potential areas of cost savings. Self-funding of employee health care benefits appears to be one such area: this approach should enable the hospital to control its health plan and allow cash flow to work to its advantage. Further advantages may accrue to the hospital which elects to self-fund its employee health plan should a group of hospitals purchase reinsurance together. SCHA members have enjoyed similar advantages through pooled arrangements in purchasing other employee benefit plans. A series of regional meetings conducted during the fall of 1980 provided a forum for discussion of self-funding alternatives by administrators, chief financial officers, and personnel directors. As a result of these meetings, hospital management is better equipped to monitor, evaluate, and consider alternatives to their present employee health plans. And SCHA, through its committee structure, is continuing to explore self-funding of employee health care benefits as a potential area of cost savings.