Large group health plan funding options

Priority Health offers three funding options to meet your needs. Each funding model offers varying degrees of financial flexibility and risk for employers to consider.

Page last updated on: 3/27/25

Fully funded

Lowest financial risk, lowest plan flexibility

  • Stable monthly premium paid to the insurance carrier
  • Minimal risk for employer as insurance carrier administers the plan and pays out the claims incurred  
  • Subject to all state and federal regulations with limited plan design flexibility
  • Great for companies that want consistent monthly costs for their health benefits

Level-funded

Moderate financial risk, moderate plan flexibility

  • Fixed monthly fees to cover the costs of administration, stop-loss and claims funding
  • Balance of flexibility and risk with opportunity for money back at contract year-end if fees paid are more than claims incurred
  • Great for companies looking into self-funding but still want some monthly cost stability

Self-funded

Highest financial risk, highest plan flexilibility

  • Low monthly administrative fee paid to carrier who manages administration of employer's plan
  • Health plan processes claims paid with funds set aside by employer
  • Less regulation with high flexibility and low fees but variable monthly costs
  • Best for companies who want plan flexibility and can manage fluctuating costs

NEW! TPA solution:

Priority Health and Healthcare Management Administrators (HMA) have collaborated to offer a TPA (third-party administrator) solution for self-funded Michigan-based employers. This new solution combines HMA’s expertise in self-funded health plans with Priority Health’s extensive network and provides employers with flexibility, control and the support they need to achieve healthier outcomes for employees at the best possible value.