Underwriting and claims forecasting for Bloomfield Hills employers that carry their own risk
A self-funded or level-funded plan is only as good as the numbers behind it. We set the rates, the reserves and the budget, then check them against actual claims every month so the renewal is never a surprise. Start with how the funding options compare if you are still deciding.
Once an employer stops paying a fully insured premium, somebody has to answer the questions the carrier used to answer: what to charge employees, how much cash to hold back, and what next year will cost. Those answers come from underwriting, not from the stop-loss quote. See our self-funded health plans page for the structure itself.
What we build
Premium equivalents. The working rates you charge employees and quote for COBRA. Set too low, the plan runs short; set too high, you are over-collecting from your own people.
Claim reserves. Claims incurred this year keep arriving for months after it ends. The reserve is the cash that covers that run-out if you change carriers or funding, and it is the number most often left out of a first-year budget.
Annual funding projections. Expected claims, fixed costs and stop-loss premium, laid out month by month so finance knows what the plan will need and when.
Monthly claims reporting. Actual against expected, large claimants against the stop-loss attachment point, and the trend that decides whether the renewal needs a conversation in March rather than October.
Why forecast before the renewal arrives?
The renewal number is built from the same claims data months before it reaches you. If the projection is already on your desk, the renewal becomes a check on the carrier’s math rather than a number you have to accept. When a formal actuarial opinion is required, we bring in the actuaries we work with.
Does a level-funded plan need this too?
Yes, in a lighter form. A level-funded plan bundles the reserve and the stop-loss into one monthly payment, but the surplus refund, the terminal liability and next year’s rate all depend on how claims actually ran. Reading those reports is what tells you whether to stay level-funded or move.
Common questions
How is a premium equivalent different from a premium?
It is a rate you set, not a price you are charged. It funds expected claims and fixed costs, and it is the basis for employee contributions and COBRA rates. Because COBRA rates follow from it and stay fixed for the year once set, getting it right at the start matters. We document how each rate was built so it can be defended to employees and to an auditor.
What happens to the reserve if we go back to a fully insured plan?
It pays the claims incurred before the switch that arrive after it. Without it, those bills land on cash flow in the first months of the new plan. We size that run-out from your own claims lag rather than a rule of thumb, and price any terminal liability option on the stop-loss in advance so the choice is made on numbers.
How often should the forecast be updated?
Monthly against actual claims, with a full re-projection before the renewal is priced. A single month well above expected is a signal to check for a large claimant or a new pattern, not a reason to reset the whole budget. The re-projection before renewal is where those months are weighed properly, alongside any stop-loss reimbursements already received.
Talk to us about claims forecasting in Bloomfield Hills
Book a 30-minute call and we will walk through claims forecasting in Bloomfield Hills for your team. Visit us at 41000 Woodward Avenue, Suite 350 East, Bloomfield Hills, MI 48304, or call 248.370.8853.
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