Report to Congress: Annual Report on Self-Insured Group Health Plans (Mar. 2023); Appendix A, Group Health Plans Report: Abstract of 2020 Form 5500 Annual Reports Reflecting Statistical Year Filings (Oct. 2022, v. 1.0); Appendix B, Self-Insured Health Benefit Plans 2023: Based on Filings Through 2020 (Sept. 30, 2022)
The DOL has released its required annual report to Congress on self-insured health plans. The report provides aggregate information about the characteristics of private-sector self-insured health plans, including number of participants, benefits offered, funding arrangements, and plan assets, as well as publicly available financial information about their sponsoring employers. The 2023 report is based on 2020 Form 5500 filings.
Approximately 74,100 health plans covering about 78 million participants filed a Form 5500 for 2020. Of those, about 37,900 were self-insured plans, covering about 35 million participants. According to a table comparing 2019 and 2020 data, the number of self-insured plans filing Form 5500 increased by over 7,000, while the number of covered participants decreased by about one million. For 2020 filings, about 51% of plans were self-insured; 43% were fully insured; and 6% were a combination of insured and self-insured. In comparison to 2018 filings, the breakdown of plan types essentially flipped (see our Checkpoint article). But the distribution of plan participants has remained largely unchanged, with self-insured plans covering about 45% of participants, fully insured plans 18%, and combination plans 37%. According to the report, new plans were mostly small, self-insured plans, with growth driven by an influx of filings by small plans participating in multiple employer welfare arrangements (MEWAs).
The report’s appendices provide further analysis, including detailed information about plan funding. Appendix A notes that combination plans (despite comprising 6% of plans and covering 37% of participants) owned 55% of the group health plan assets held in trusts; as a result, this relatively small number of plans drove many of the report’s aggregate statistics. Appendix B delves into funding mechanisms and financial metrics, examining funding mechanisms by plan size, industry, and plan life cycle stage, among other things. It also analyzes stop-loss coverage for small and large plans, with the caveat that because stop-loss coverage is reported on Form 5500 only if the plan is the policy’s beneficiary or if premiums are paid from plan assets, Form 5500 filings do not fully capture the use of stop-loss coverage.
EBIA Comment: Because many group health plans are exempt from filing Form 5500, the report does not reflect the full universe of plans. Nevertheless, the data clearly reveal an increase in the use of self-insured health plans. For more information, see EBIA’s Self-Insured Health Plans manual at Sections IV.B (“Financial Considerations”) and IV.E (“Prevalence and Characteristics of Self-Insured Health Plans”). See also EBIA’s Health Care Reform manual at Section XXXVI.E (“Annual Report on Self-Insured Plans (Using Information From Form 5500s)”) and EBIA’s ERISA Compliance manual at Section XXII.B (“Important Form 5500 Exemptions for Small Unfunded and/or Insured Plans”).
Contributing Editors: EBIA Staff.