Is your ministry exploring a self-funded health plan as an alternative to traditional health coverage? Perhaps you’ve heard that it could cut costs and provide exemptions from certain Affordable Care Act (ACA) provisions. GuideStone® encourages ministries to carefully evaluate the risks and rewards before making a decision that carries an extensive impact.
Exactly what is a self-funded health plan? And what are the pros and cons? To help you navigate these questions, we’ve developed a white paper titled The Role of Self-Funded Health Plans in Ministry Health Coverage. Here are some highlights you’ll find.
Self-funding describes a type of health coverage in which the employer assumes responsibility to pay employee claims for health care expenses rather than paying those costs through premiums paid to a private insurer.
Employers that establish a self-funded health plan accept responsibilities for all aspects of the employee health plan, including:
When considering the responsibilities required for self-funding, you may want to ask:
If a self-funded employer encounters catastrophic claims or an excessive number of claims, the reserves may not be enough to cover them. Most self-funded employers purchase stop-loss insurance to protect against claims in excess of their reserves.
GuideStone is committed to offering affordable, quality health coverage in alignment with biblical values. As ministries of all sizes band together under GuideStone’s plan, they can enjoy the benefits of self-funding without putting their organizations in financial jeopardy.
Because the GuideStone plan as a whole pays the claims, the ministry does not need to purchase stop-loss coverage. The risk of catastrophic claims is calculated into the rates and spread out among all employers.
| Self-funded Health Plans | GuideStone Church Plans | |
| Financial risk | Employer assumes the risk | GuideStone assumes the risk |
| Risk is based on | Only the ministry's employees | Multiple ministries of all sizes, which helps spread out the risk |
| Responsible for plan administration and claims management | Employer (could contract out to a third-party payer) | GuideStone |
| Responsible for funding for claims payment | Employer (may require hiring experts, like an actuary and investment advisor) | GuideStone |
| Responsible for IRS reporting | Employer | GuideStone |
| Responsible for creating a medical network | Employer | GuideStone |
We understand that you are searching for ways to provide quality benefits while being a good steward of your ministry’s budget. Choosing a group health plan is an important decision that has far-reaching financial repercussions for your ministry and its employees. For more information on the benefits of GuideStone health plans, contact us at Insurance@GuideStone.org or 1-844-INS-GUIDE (1-844-467-4843), Monday through Friday, from 7 a.m. to 6 p.m. CT.
GuideStone welcomes the opportunity to share this general information. However, this article is not intended to be relied upon as legal advice.
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