Funding Arrangements

Your EmblemHealth representative can help you select the funding method that works best for you and your fund members. The most common conventional and alternative options for groups include:

Funding ArrangementsExperience Rated

Historical claims experience is used as the basis for projecting future claims and determining premium. These arrangements include pooling of individual high-cost claims to protect funds against the effects of catastrophic claims.
Availability: Funds with 51 or more eligible members.

Prospective Rated

The anticipated claims experience is evaluated for a future policy period based on a fund’s actual experience and the performance of the EmblemHealth pool for similar businesses. The cost of the plan is determined and fixed in advance of the policy period, and the fund is not eligible for any retroactive rate refunds. Losses (deficits) are not carried forward.
Availability: Funds with 51 or more eligible members.

Retrospective Rated

This approach evaluates and measures a fund’s past claims data to estimate future costs of providing benefits, based on a fund’s actual experience. The fund is eligible for retroactive rate refunds when earned premium exceeds the plan's overall expenses.
Availability: Funds with 1,000 or more eligible members, these arrangements are subject to underwriting review and approval.

Deferred Premium

Eligible funds are allowed to remit a percentage of their gross earned premium on a monthly basis, called the "payment rate." The difference between the payment rate and the gross earned premium rate is "callable" by EmblemHealth at a later date, depending upon claims experience and other factors.
Availability: Subject to underwriting review and approval.

Community Rated

This methodology combines overall medical cost per plan to determine a standard premium rate for that plan.
Availability: All funds with fewer than 51 eligible members and all funds enrolled in EmblemHealth HMO plans.

Administrative Services Only (ASO)

Administrative Services Only (ASO) enhances cash flow by allowing the fund to reimburse EmblemHealth solely on the basis of paid claims plus administrative fees. This rating arrangement is not insured and the fund is responsible for all claim payments and administrative charges associated with the plan. Stop-loss insurance is recommended for all ASO accounts, but is required for funds with less than 1,000 eligible members. The fund retains the flexibility of securing its own stop-loss quote through a vendor of its choosing or having EmblemHealth request a quote through one of its preferred vendors.
Availability: Funds with 250 or more eligible members.

EmblemHealth offers conventional and alternative funding arrangements and will consider special funding arrangements as requested by prospective funds — including ASO self-insurers — contingent upon fund size.

For purposes of this document, any reference to members is representative of the contract holder.