To self-fund or not to self-fund, that is the question. As the fully insured market continues to get slammed by unreasonably large rate increases, more employers are looking to self-funding as an opportunity to escape the chokehold of ever-increasing premiums. Watching the growing popularity of self-funding is exciting, but I advise employers to proceed with caution.

Self-insuring the health plan opens an employer to great opportunity, but looking to self-funding as the ultimate destination may bring great disappointment. Simply put, self-funding is a vehicle, not the destination. It is not the solution; it is an avenue providing an organization with the opportunity to do some incredible things with its health plan. Look at it this way: without a destination in mind or a road map to get there, an automobile is useless. However, if you have a chosen destination with a clear set of directions to get there, an automobile becomes an efficient vehicle allowing you to arrive at your destination successfully.

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