Group captives for medical stop loss enjoying rapid growth


Captive programmes can significantly contribute to healthcare cost containment and improve employee health in both the US and in other major territories where employers offer employee healthcare programmes.

This is according to a CICA 2018 International Conference session, “Case Study for Wellness & Benefits in a Captive”, which featured speakers Scott Byrne, vice president of captive business development at Berkley Accident & Health, and Tris Felix, director of Cornerstone Risk Solutions.

Medical stop loss is estimated to be a $10 billion industry, and the group captive market is growing rapidly, said Felix.

In the last 10 years, 35 to 50+ new programmes have been formed, with around $400 million to $500 million in stop loss premiums.

“We estimate group captive numbers in medical stop loss is closer to 50 nationally. It’s 5 percent of the total stop loss market,” said Felix. “We feel as though as group captive programmes could grow to be 10 percent of the market.”

The panel suggested that these group medical stop programmes are compelling as they largely convert fully insured employers and take them into a self-funded model.

“It’s converting fully insured health plans to self-funded plans,” added Felix.

The panel noted that it is typically small and middle market employers joining these programmes and the average size of plans tend to include 200 enrolled employees.

Byrne added: “There’s no magic in the group captive - it’s simply a funding vehicle, a mechanism for sharing risk. Where you can have the most impact is how you handle the risk and how you manage the risk in that environment. These are being driven by employees, the members of the captives themselves.”

Byrne suggested that these plans are a great way to identify potential claims situations that could develop down the road.

Plans can also have a variety of additional benefits including telemedicine and on-site clinics.

Some of the benefits of this include convenience for employees, being less expensive than ER and urgent care, and reducing hours away from work.

“The advent of telemedicine has been a tremendous development in the sense that people can pick up their smartphones and have 24/7 access to a nurse or physician to talk about their symptoms,” said Byrne.

CICA 2018 International Conference, Scott Byrne, Berkley Accident & Health, Tris Felix, Cornerstone Risk Solutions, Healthcare, US

Captive International