National General Insurance Update June 2018

Recently, National General Insurance representatives visited MIBS and offered some interesting ideas to consider for your potential groups.  In case you are not aware, National General Insurance offers Level Funded health plans for group benefits.  These plans are made up of three components which are seen in the quote:

1. Administrative fees
2. Claim Fund Account (estimated total of annual claims divided by twelve and included in monthly premium)
3. Stop Loss plan (In the event total claims go over the stop loss amount, this plan starts paying the medical claims)

These plans are medically underwritten and not guaranteed to issue so only eligible groups should be considered for these plans.   But for those groups who are eligible for level funded plans, they could benefit from low premiums and the potential to receive premium back if there is a balance in their claim fund account at the end of the plan year.   Once the plan is in place, the employer will only be required to pay their set monthly premium regardless of claims.   They will never owe more than that monthly premium.   In the worse case scenario where the group experiences high claims, the carrier will simply send a renewal that the group might not want to keep and then would be moved to a fully funded plan.

Advantages with National General

• Has tremendous flexibility in plan design and access to multiple networks including the Aetna Signature network which is second only to BCBS IL’s large PPO network.
• The Aetna Signature network includes all the minor and major systems in Chicago, including Northwestern, University of Chicago, Loyola, Advocate, Northshore, Rush, Adventist and more.
• National General’s sweet spot is in the under 20 enrolled market and they will go down to 2 lives enrolled. Competitors in the level funded market normally require 5 or 10 enrolled to be eligible.
• National General can write startup businesses, virgin groups, and 1099 groups.
• They are very flexible with participation.
• Mom and Pop businesses who have to wait a year to be eligible for group because they had to recently hire a non-owner employee, can purchase a group plan with National General now by hiring a non-owner employee prior to the effective date of the plan.

Possible Markets to Find Eligible Groups

That mom and pop group who did not have any non-owner employees during the prior year.   If mom and pop are healthy, they may be eligible to enroll with National General next month, as long as they have another non-owner employee (can be part time) on payroll before the effective date of the plan.  Minimum number of employees required to enroll is two.

Businesses known for healthy lifestyles like Chiropractors, Fitness Centers, Alternative Health Centers, etc.

Businesses in the Northshore area might be interested as the Aetna Network has the desired hospitals and doctors.   Groups trying to save premium dollars by moving to a small network in a fully insured plan, often lose access to those desired hospitals and doctors.  Those groups can save premium dollar and still access desired North Shore providers.

Business types that National General sells their level funded plans to most often include:

• Software firms (#1 SIC code of all active plans)
• Auto Body and Auto Repair Shops
• Plumbing Companies
• Specialty Contractors

Property and Casualty agents with commercial accounts in the above list, might want to review with those businesses if they would benefit moving their health plan to a National General Level Funded plan.

Agents reviewing their group’s next renewal might want to think about National General.