What if a small group would like more of the traditional benefits of self-funding (instead of just avoiding the modified adjusted community rating rules)?

For instance, the employer might like the chance for a return of premium, benefit flexibility, etc.

The group may want to consider joining a captive.

A captive is an insurance company formed and owned by the members of the captive.

The groups that are part of a captive are self-funded and have their own stop-loss amount.

However, collectively there is a layer of claims that the captive contributes to before the reinsurance kicks in.

It’s possible for a captive member to have a bad year but still get some money back if the captive has a good year.