Minimum Premium Financing Option

For employers with 101 or more enrolled employees*

Minimum Premium incorporates the advantages of a fully insured plan and the best features of a self-funded insurance plan – yet limits your company’s costs and claims exposure.

With Minimum Premium:

• You pay the claims expenses incurred by your company. This is similar to a self-funded plan.
• Like a traditional fully insured plan, your financial liability is limited to a specific dollar amount each month and a cumulative dollar amount each year.
• You are protected from the effects of high individual claims because claims exceeding $35,000 become Wellmark Blue Cross and Blue Shield’s liability.
• You pay monthly for fixed costs associated with your benefit plan.

The fixed costs consist of two components:

• The operating costs for the actual administration of your benefit plan (includes costs of processing and paying claims, providing benefits management services, providing access to Wellmark Blue Cross and Blue Shield’s network, executing coordination of benefits provisions, large claims pooling charges and premium tax)
• Runout funding (used to pay for claims that are incurred, but not yet paid, at termination of the contract)

In a nutshell, each month you pay fixed costs (determined by the number of covered employees and the type of coverage they have) plus claims expenses (limited to a monthly maximum).

Advantages of Minimum Premium

• Your company’s costs and claims exposure are limited, which helps your cash flow
• If claims are lower than expected, your liability is lower and you retain the difference
• Claims (in excess of the runout funding) incurred but not yet paid at termination of the agreement are the responsibility of Wellmark

^{*The Minimum Premium financial arrangement is available for all of our products. Your company must have the same financial arrangement if you offer multiple products. Also, each product must have at least 51 employees under the Minimum Premium financial arrangement.}

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Wellmark Blue Cross and Blue Shield is an Independent Licensee of the Blue Cross and Blue Shield Association doing business in Iowa and South Dakota. Blue Cross®, Blue Shield®, and the Cross® and Shield® symbols are registered marks of the Blue Cross and Blue Shield Association, an Association of Independent Blue Cross and Blue Shield Plans.