Agg Accommodation, Non-Networked Solutions, Good Cancer News, and more: Issue 77

Aggregate Accommodation: The Stop-Loss Feature You're Missing

I'm working with one of my existing clients to help them understand a stop-loss proposal to help them move to a self funded health plan, and Aggregate Accommodation is a key piece to making this transition work.

With a regular fully-insured health plan, you pay a set premium every month for the 12 months of the contract, while with a self-funded plan, you pay as claims are incurred up to either the individual or aggregate deductible (limits to the per person cost and per year cost).

Even if a proposal projects savings over the course of the year, what if a member had a significant health event early in the plan year and you hit your agg deductible in month 3? Groups tend to struggle with the unevenness of cash flow in a self-funded plan... so that's why you see groups look at level funding.

Level-funding has exploded in recent years, as the Kaiser Family Foundation's research has found that 38% of covered workers in small businesses are enrolled in level-funded health plans, a sharp increase from 6% in 2018

But by adding Aggregate Accommodation to a stop-loss contract, we can get much of the same effect as level-funding. This provision prorates the aggregate deductible every month of the contract, so you don't have to hit the full 100% aggregate amount before the end of the plan. It's a cash flow benefit to support the group in the event claims are high early in the plan year. It's probably best if we look at an example:

• The group has a $600,000 aggregate deductible and agg accommodation, which prorates monthly by $50,000 (1/12 of $600,000)

• Month 1's aggregate is $50,000, Month 2's is $100,000, etc.

• If the annual aggregate amount hits this ceiling during the year, the policy fronts the money required to pay the claim above and beyond the plan obligation, and the group repays the fronted amount through the rest of the year

In effect, a group could choose to fund a sinking account for the plan year with aggregate accommodation and not see much of a difference compared to a level funded or fully insured premium.

There's a premium to adding this provision to your plan, so it's worth asking your finance team if they can afford uneven cash flow during the plan year or if they'd rather pay a slight premium to have more regular expenses for the health plan.

Interesting discussion on health insurance carriers

My buddy Nikhil Krishnan is a must-follow for anyone whose work involves healthcare, and he received a lot of engagement yesterday for a post about starting an insurance carrier. Of particular note was a comment by another buddy of mine, Russell Pekala on how immediate payment and cash pay approaches will disrupt the status quo use of networks to control healthcare access:

Keep an eye on this space in healthcare and bring it up at your next renewal. New approaches to paying for healthcare rather than offering blanket access at a pre-set cost (your network) will continue to break through. This recent episode of 🎙Spencer Smith, CSFS® 's podcast with Dean Jargo talks about this approach and is worth a listen too.

Want to talk about non-networked solutions for your health plan? Let's talk!

Cancer mortality has fallen overall while incidence has remained stable

While we've seen a drop in cancer screenings and an increase in the average stage at diagnosis in many cancers, a recent study published in the journal of the American Cancer Society found that cancer incidence rates have remained fairly stable but death rates decreased. This is an encouraging sign that our focus, research, and development of cancer treatments is working.

Still, cancer remains a top risk for employer health plans and screenings are a key tool in catching early stage cancer. Employers should look into how to promote screenings among their population and help them find quality and cost effective treatment options when they are diagnosed.

GLP-1's driving health care cost growth

GLP-1's like Ozempic and Wegovy continue to be a big topic of conversation when we look at rising healthcare costs in 2025.

They were originally developed to treat type 2 diabetes but have gained considerable attention for how they aid weight loss. But many plans are now reconsidering how to treat these drugs, as their monthly costs can range from $1,000 to $1,500.

So while they can create significant health outcomes for members, employers are exploring ways to manage the cost more effectively. Generics and biosimilars are one key approach, and behavior and habit support is another important piece of a weight loss journey that employers are looking into for their members.

⚖️ Labor & Employment Law Updates

Navigating Employers' Diversity Program Risks and the False Claims Act

“Deputy Attorney General Todd Blanche issued a memorandum concerning a ‘Civil Rights Fraud Initiative’ and announcing it would ‘utilize the False Claims Act to investigate and, as appropriate, pursue claims against any recipient of federal funds that knowingly violates federal civil rights laws.’” Full Article from Duane Morris, LLP & Affiliates

Department of Labor Proposed Budget Seeks To Completely Dismantle OFCCP

“According to the U.S. Department of Labor’s (DOL) fiscal year 2026 proposed budget, the Department is set to fully eliminate the Office of Federal Contract Compliance Programs (OFCCP) next fiscal year, which begins October 1, 2025.” Full Article from Jackson Lewis P.C.

US Employers Must Submit 2024 EEO-1 Data to the EEOC by June 24, 2025

“Data collection for 2024 EEO-1 Component 1 filing opened on May 20, 2025. Employers have until Tuesday, June 24, 2025 to submit their data to the agency.” Full Article from Squire Patton Boggs

Voluntary Buyouts: The Pros and Cons

“Yesterday, the Trump Administration announced that it offered voluntary buyouts to over two million federal employees. Employees who voluntarily resign their position will receive payments equal to approximately eight months of their salary. Obviously, the goal is to reduce the size of the federal workforce and related expenses.” Full Article from McNees Wallace & Nurick, LLC

AI on Trial: Implications of the Workday Lawsuit for Automated Hiring

“Artificial intelligence continues revolutionizing HR and talent acquisition, promising efficiency and scalability in hiring processes. However, as a recent lawsuit against Workday shows, automation does not absolve employers or their vendors of compliance with anti-discrimination laws.” Full Article from Dickinson Wright

Supreme Court Rejects ‘Background Circumstances’ Rule for Title VII Claims Brought by Members of Majority Groups

“On June 5, the Supreme Court decided Ames v. Ohio Department of Youth Services, holding unanimously that members of majority groups suing their employers under Title VII of the Civil Rights Act of 1964 (Title VII) are not required to demonstrate ‘background circumstances to support the suspicion that the defendant is that unusual employer who discriminates against the majority.’” Full Article from Paul Hastings, LLP

California Appeals Court Approves Prospective Meal Period Waivers

“In a case of first impression, Bradsbery v. Vicar Operating, Inc., the California Court of Appeal held that a prospective, written waiver of meal periods for work shifts between five and six hours is enforceable. In other words, forward-looking ‘blanket’ written waivers are valid in the absence of any evidence of coercion or unconscionability.” Full Article from Hunton Andrews Kurth, LLP

That's it for this week's Competitive Advantages! Be sure to follow and reach out to me with any questions.

🗞️ Subscribe to Competitive Advantages

📧 Email me at jhansbrough@acrisure.com

🕒 Schedule time with me!