For decades, stop loss underwriters have operated with a short-sighted approach to plan design: reviewing historical claims to estimate costs for the upcoming year, often backed by a certain degree of guesswork and hope.
Unfortunately, for many employers, those estimates have failed to account for the astronomically rising overall costs of healthcare over the past few years. The stop loss industry has experienced a 55% increase in million-dollar claims since 2018 — forcing many self-funded payers to shell out for these unanticipated costs year after year, expenses that are ultimately passed along to employers over time in the form of higher stop loss insurance costs.
What if we told you there was a better way — one that more accurately predicts stop loss costs and reduces claims throughout the year, allowing for more affordable stop loss pricing without compromising the level of financial protection?
Below, we’ll explain how a proactive approach to stop loss underwriting — one that occurs at the same time as overall benefits plan design — can save self-funded employers money in the short and long run, enable TPAs and brokers to support their clients with stronger, more strategic solutions, and simultaneously deliver smarter, better, faster healthcare for all involved.
Traditionally, stop loss plan design has been viewed as an afterthought to overall benefits plan design. But mitigating the ever-rising costs of modern healthcare requires an integrated approach — one in which stop loss underwriters work hand in hand with plan designers to better anticipate and minimize expenses before renewal season even begins.
By designing both stop loss and overall benefits plans concurrently, we can not only build significant cost savings into the plans themselves — but also provide a more personalized, long-term strategy for self-funded employers that creates a higher-quality healthcare experience for all involved.
All stop loss policies are designed to anticipate and protect self-funded employers from potential high-cost claims. But, by designing stop loss plans at the same time as overall benefit plans, self-funded employers can actually minimize the likelihood of those claims occurring in the first place — in turn, reducing their monthly premiums rates and expected claim costs.
Forward-thinking stop loss underwriters are increasingly rewarding self-funded employers who build cost-savings features into their employee plans. Solutions like cost steerage and care navigation proactively point members to lower-cost, higher-quality care, reducing overall plan expenses (and related stop loss claims).
At Vālenz Health®, our underwriters provide significant stop loss credits for employers who invest in these features. And, unlike other stop loss programs, we give these credits in the first year of the stop loss policy whenever possible.
Simply put, we strongly believe in the power of our member engagement tools to save on costs and deliver higher-quality healthcare, so much so that we willingly reward employers who opt for these features upfront — because we know just how powerful they can be when put into action.
To learn more about these cost-saving opportunities, reach out to a Valenz team member today.
By design, self-funded healthcare plans come with a great degree of flexibility — and that flexibility is heightened with the cost savings provided by proactive stop loss underwriting.
Because they’re free from the restrictions of state mandates, self-funded employers can write into their plan exactly what they do and don’t want to cover. Designing those plans in tandem with stop loss coverage gives underwriters a greater ability to create a cost-savings policy (in contrast to designing after the fact, when an underwriter is forced to design a policy within the restrictions of a benefits plan that’s already set in stone).
At Valenz, our stop loss underwriters will help you design the perfect plan document to fit your clients’ needs. Using a foundation we know works from our decades of experience in the industry, we can recommend specific stop loss solutions that support employers and payers in containing costs, based on the coverages and features they are considering in their overall benefits package.
And, when those employers choose to implement our comprehensive suite of healthcare solutions, we will also recommend the features that are most likely to enhance plan performance (such as our variable co-pay model, a feature of ValenzONE) — and ensure the stop loss plan is underwritten with those programs in mind.
Finally, the greatest advantage of designing stop loss in tandem with benefits plans is one that will compound over time: the opportunity to craft a long-term strategy for reducing costs and improving care outcomes.
For too long, stop loss underwriters have led with a strategy of hope and wishful thinking when it comes to anticipating upcoming healthcare costs. But with the advance of predictive analytics and AI technology, today’s stop loss plans can (and should) be grounded in real data — and backed by the cost-containment features built directly into the benefits plans themselves.
The best stop loss strategies take a long-term approach to reducing costs for payers. When those strategies are built concurrently with the actual benefits programs they cover, they work that much more efficiently, because the support exists to implement them properly from day one.
At Valenz, we believe in a true integration between healthcare vendors to increase transparency for all involved. With a full understanding of the entire patient journey, we can reduce the delays and gaps in claims that have historically made costs difficult to predict — in turn, allowing us to craft better stop loss policies for self-funded employers.
Additionally, by working together with the entire healthcare continuum to understand and predict costs as they occur throughout the year, our stop loss underwriters can effectively eliminate the element of surprise when it comes to renewal pricing.
The result: More funds available to the self-funded employer, who can invest those back into the healthcare plan for a better member experience, compounding the cost savings and the success of the plan over the long term — enabling you (as the broker or TPA) to demonstrate tangible results, deepen client trust, and position yourself as a strategic partner in delivering sustainable value.
Unlike other stop loss providers who work independently from other healthcare vendors, our team at Valenz is proud to offer stop loss underwriting as part of a fully integrated, complete suite of healthcare solutions.
In other words, when it comes to underwriting stop loss concurrently with healthcare plan design, we have all the resources at hand to make it happen.
Using our integrated platform, our underwriters have access to data from the entire patient journey, which they use to inform anticipated plan costs and build policies that best protect payers — while simultaneously recommending ways to invest plan spend into cost-containment features that deliver lower-cost, higher-quality care to plan members.
By partnering with Valenz to underwrite stop loss policies and design overall health benefits plans, our clients experience up to a 50% reduction in premiums, with a 7%–12% average savings in overall costs when implementing our ValenzONE health plan optimizer.
To see how much your clients can save — and how much difference a proactive stop loss strategy can make in your client retention and satisfaction — contact one of our team members today.