Measuring ROI of Self-Funding Through Group Captives

This guide outlines the process for measuring the return on investment (ROI) of self-funding through a group captive in the context of healthcare costs. It begins by detailing the key components that contribute to self-funding ROI, including fixed and variable costs, claims spending, captive pool contributions, stop-loss premiums, and administrative costs. The document presents a five-year projection model, emphasizing the importance of establishing a baseline by documenting current fully insured costs and calculating expected self-funded costs. It also discusses potential savings, including direct cost savings and indirect savings opportunities, such as claims account surplus and provider network optimization. The guide concludes with next steps for organizations, including gathering current plan data and requesting personalized analyses. It provides a real impact example comparing traditional insurance costs to those of a self-funded group captive over five years, illustrating the potential for significant savings.