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Fully insured vs level-funded vs self-funded
A nine-row comparison across claims risk, monthly cost, what happens in a good year, claims data access, stop-loss, administration, typical fit, exit liability and governing framework.
Health plan funding, and when changing it is actually justified
Every employer health plan sits in one of three funding structures, and the difference between them comes down to a single question: who carries claims risk? Fully insured moves it to the carrier. Self-funded keeps it with the employer, capped by stop-loss. Level-funded sits between them.
New to this topic? Read in this order
- Compare the three structures against claims risk, cash flow, data access and administration
- Understand stop-loss, because it is what makes self-funding survivable
- Review the cost levers you already hold under your current structure
- Consider whether an ICHRA is a better fit than a group plan at all
Nothing in this cluster recommends a structure or guarantees savings. Availability, rates, stop-loss terms and refund provisions all depend on underwriting.
This cluster sits inside the Employee Benefits & ACA Resource Center. To discuss your own plan rather than read about structures, start with 4J’s employee benefits practice or the group health page.
Understand the structures
What is stop-loss insurance?
Specific versus aggregate, contract basis, lasers, and the run-in and run-out provisions that decide whether the policy responds when a claim actually lands.
Group health insurance
4J’s commercial group health page, including the free ALE and affordability screening tool and how a benefits audit is actually run.
Employers rarely lose money on the funding structure they chose. They lose it on the stop-loss terms nobody read.
Cost and alternatives
Seven ways to lower health plan costs
The levers Texas employers actually hold, ordered by how much control the employer has over each one and what each requires in data or administration.
What is an ICHRA?
Funding individual-market premiums instead of sponsoring a group plan. Where it works, where it does not, and what it does to ACA affordability.
Why cost and coverage clash
Why the cheapest renewal and the right coverage are usually different answers, and how to tell which trade-off you are actually making.
Should you change funding structure?
A claims and funding analysis models the structures against your own census and claims history, prices the exit as well as the entry, and says plainly whether your experience is credible enough to justify a move.