Self-funding is an alternate, affordable way for you to provide quality health care benefits for your employees. When you decide to self-fund, you, in essence, become an insurance company, and at that point must be willing and able to financially and conceptually assume the risk that is normally carried by an insurance company.

When you establish a self-funded medical plan, you also assume the responsibility to provide the administrative functions of the plan—utilization review, claims adjudication, claims auditing and reports. A third-party administrator (TPA) is usually selected to provide these administrative services.

As a self-funded employer, you are actively involved in the plan design and have control over the use of benefits.