Self-Funded Customer Management

Self-funded health insurance, also known as Administrative Services Only (ASO), is a self insurance arrangement whereby an employer provides health or disability benefits to employees using the company's own funds. In self-funded health plan, employers operate their own health plan. However, in the fully-insured group health plan, the employer contracts an insurance company to cover the employees and dependents. Employers choose to self-insure because it allows them to save the profit margin that an insurance company adds to its premium for a fully-insured group health plan. However, self-insuring exposes the company to much larger risk in the event that more claims than expected must be paid.

Oracle Revenue Management and Billing (ORMB) supports the following types of self-funding approach:

• Fully Self-Funded - In the fully self-funded approach, the employer retains all the risk and bears the claim costs irrespective of any limit.

• Partially Self-Funded - In the partially self-funded approach, the employer purchases reinsurance or stop loss coverage to pass the risk to insurance company.

The system enables you to create customers and accounts for the self-funded health insurance business. This chapter explains how to create different entities involved in the self-funded health insurance business.

Parent topic: Oracle Revenue Management and Billing Insurance Business Processes