American Administration Services Company
Stop-Loss Insurance - This insurance coverage is taken out by a self-funded employer to provide protection from losses resulting from claims greater than a specific dollar amount per covered person per year (calendar year or illness-to-illness). Stop-loss insurance examples:
ü Specific or individual — reimbursement is given for claims on any covered individual which exceed a predetermined deductible, such as $25,000 or $50,000.
ü Aggregate — reimbursement for a claims exceeding a predetermined level, like 125% of the amount expected in an average year.
Excess Risk Insurance - Obtain excess risk products (via many stop-loss carriers) are designed to protect employers against catastrophic losses that may seriously endanger the financial soundness of their self-funded plans.
Terminal Liability Cap (TLC) - A Terminal liability cap product reduces exposure by establishing the maximum risk level an employer will pay for its claim run-out liability.
Monthly Accumulation Cap (MAC) - - Specific and Aggregate Advancement - Monthly fluctuations in claims can significantly influence the cash flow of small-to medium-size employer groups. A Monthly accumulation cap product can assist self-funded employers with better management of cash flow.
Life - Multiple employer-paid life insurance plans & Employee-paid supplement life coverage plans.
Long-Term Disability (LTD) - To pay employees a percentage of monthly earnings in the event of disability.
Medical Conversion - A Fully-insured medical insurance option is available to enrollees who have exhausted their COBRA coverage.
Lasering – The carving-out of severely ill employees from specific coverage; a tactic used by insurers to shift the costs of the sickest workers back into the lap of employers via increased cost for new or renewal of stop-loss, or reinsurance contracts. Many employers are not very happy about the choice between sharply higher premiums or shouldering the risk of very sick employees in self-insured plans. Lasering offers an alternative to paying a higher premium and is often done at the request of an employer seeking to avoid a premium increase, even though it is a tough decision to have to make. NOTE: Employees cannot be charged a larger premium because lasering has occurred AND the Americans With Disabilities Act prohibits employers from firing employees or refusing coverage due to illness.
NOTE: Outsourcing your HIPAA certificates of creditable coverage to a TPA will not relieve you of your responsibilities under HIPAA in a self-funded health plan. Both group health plans and insurers offering group health insurance coverage are subject to the HIPAA Certificate requirements, so in an insured plan, both the administrator and the insurer are responsible for the HIPAA Certificate. In a self-funded plan, the obligation is placed on the plan administrator, which is often the employer/plan sponsor. This, like many other obligations, can be delegated, but in the case of the HIPAA Certificate, the consequences of an administrator of an insured plan delegating its HIPAA Certificate responsibility to the insurer are much different than the consequences of an administrator of a self-funded plan outsourcing the same responsibility to a TPA.
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