How much can Connecticut employers save with level-funded vs fully insured?

Based on Connecticut's average fully insured PEPM of $790 and typical level-funded discounts, employers can expect to save approximately 10% on a level-funded plan in the expected claims scenario. Best-case savings with surplus refunds can reach 20-30%. The Connecticut cost index of 1.15 affects both fully insured and level-funded pricing.

What is the stop-loss cost for level-funded plans in Connecticut?

Stop-loss costs in Connecticut are indexed at 1.12 relative to the national average. For a $50,000 individual specific attachment point, expect approximately $155 x 1.12 = $173 PEPM before age and industry adjustments. Lower attachment points ($25K-$40K) provide more protection but cost more.

What are the risks of level-funded plans in Connecticut?

The primary risk is that actual claims exceed the claims fund, requiring the employer to cover the shortfall up to the aggregate stop-loss corridor (typically 125% of expected). However, specific stop-loss caps individual catastrophic claims, and aggregate stop-loss caps total group exposure. In Connecticut, the moderate carrier market provides moderate carrier competition with higher baseline costs.

What carriers offer level-funded plans in Connecticut?

Level-funded carriers in Connecticut include UnitedHealthcare Level-Funded, Cigna Level-Funded, Aetna Funding Advantage. Fully insured carriers for comparison include Anthem Blue Cross Blue Shield, ConnectiCare, UnitedHealthcare, Aetna. Connecticut's level-funded market is classified as moderate, with a minimum group size of 2 employees for most carriers.

Connecticut Level-Funded vs Fully Insured
Savings Calculator

Compare level-funded and fully insured health plan costs for your Connecticut business. See potential savings, surplus refunds, and worst-case scenarios -- powered by Connecticut-specific carrier data and actuarial benchmarks.

Connecticut Level-Funded Market at a Glance

Avg FI Premium PEPM

$790/mo

LF Savings Potential

10% avg

Cost vs National Avg

+14%

LF Market

Moderate

Min Group Size: 2 employees

Surplus Return: 40-65% of unused claims fund

LF Carriers: UnitedHealthcare Level-Funded, Cigna Level-Funded, Aetna Funding Advantage

Mandates: Extensive mandates including infertility, hearing aids, autism, and TMJ treatment

Your Company

Tell us about your Connecticut business so we can model level-funded vs fully insured costs using Connecticut-specific rates and carrier data.

State ?Connecticut has a cost index of 1.15 relative to the national average (1.00). This affects claims fund calculations, stop-loss pricing, and overall level-funded plan costs.Source: KFF 2025 State Health Facts; CMS GPCI Data

Number of Employees ?Full-time employees eligible for health benefits. Level-funded plans in Connecticut are available for groups of 2+ employees. Groups of 10-250 are the sweet spot for level-funded savings.Source: KFF 2025 EHBS; UnitedHealthcare Level-Funded Underwriting Guidelines

Average Employee Age ?Average age of covered employees. Level-funded underwriting heavily weights age. Each year above 40 adds roughly 2-3% to expected claims. Younger groups get better rates and lower stop-loss premiums.Source: CMS Federal Age Curve; SOA Group Health Experience Study

Industry ?Industry affects claims experience and level-funded pricing. Healthcare and construction workers tend to have higher claims. Tech and professional services trend lower. Carriers use SIC/NAICS codes for underwriting.Source: SOA Group Health Experience Study; Mercer National Survey 2025

Coverage Tier Mix ?Distribution of employees across coverage tiers affects blended costs. National average: ~55% single, ~15% EE+spouse, ~30% family. Adjust to match your workforce.Source: KFF 2025 Employer Health Benefits Survey

% Employee Only

60%

% EE + Spouse

20%

% Family

20%

Current Plan & Level-Funded Model

Enter your current fully insured costs and configure the level-funded model parameters. We'll show a side-by-side comparison using Connecticut-specific data.

Current Monthly Premium PEPM ($) ?Per-employee-per-month blended premium (employer + employee share). Connecticut's average is ~$790/mo for single coverage. If you don't have current coverage, use the Connecticut average as a benchmark.Source: KFF 2025 Employer Health Benefits Survey; Connecticut DOI Rate Filings

Annual Renewal Increase ?Expected annual increase in fully insured premiums. Connecticut's average trend is 8.8%. Fully insured renewals average 7-12% nationally. Level-funded plans are less susceptible to renewal shock.Source: Mercer National Survey 2025; Segal Health Plan Cost Trend Survey

10%

Plan Tier ?ACA metal tiers determine actuarial value. Higher tiers mean richer benefits and higher premiums, but also higher expected claims in a level-funded model.Source: CMS Actuarial Value Calculator

Expected Claims Ratio ?Portion of premium going to medical claims. Fully insured carriers run 80-85% loss ratios (ACA MLR floor). Level-funded plans target 65-75% expected claims as a percentage of the fully insured equivalent premium.Source: ACA Medical Loss Ratio Rules; TrustMark/Voya Level-Funded Reference Data

70%

Stop-Loss Attachment Point ?Per-person annual deductible on stop-loss policy. Claims above this for any individual are covered by stop-loss. Lower attachment = more protection but higher premium. Connecticut's stop-loss factor is 1.12x national average.Source: NAIC Stop-Loss Model Act; Sun Life/Voya Stop-Loss Rate Manuals

Admin Fee Estimate ?TPA fees, network access, and plan management costs. Typically 12-18% of the fully insured equivalent premium. Includes claims adjudication, reporting, compliance, and customer service.Source: Mercer National Survey 2025; SPBA TPA Fee Benchmark Study

15%

Include Pharmacy Carve-Out? ?Carving out pharmacy to a separate PBM can reduce costs by 5-10% on the pharmacy component, which is typically 25-30% of total claims. Adds complexity but improves transparency.Source: Pharmacy Benefit Management Institute; PBMI 2024 Trends Report

Level-Funded Health Insurance in Connecticut: What Employers Need to Know

Connecticut is one of the higher-cost health insurance states, with premiums averaging 15% above the national average. This elevated cost environment makes level-funded plans attractive for employers seeking savings, but the higher claims baseline also increases risk exposure. Connecticut has extensive state-specific benefit mandates, including infertility treatment, hearing aids, autism services, and TMJ treatment coverage. Level-funded plans structured under ERISA may avoid some of these mandated benefit costs, though employers should carefully consider which benefits to include.

The Connecticut level-funded market is served primarily by national carriers, as Aetna (headquartered in Hartford until its CVS merger) and Cigna (headquartered in nearby Bloomfield) have strong local presences. ConnectiCare, a regional carrier, offers fully insured plans but not level-funded products. UnitedHealthcare and Anthem also compete in the level-funded space. Despite having several carrier options, Connecticut's higher-cost medical environment means stop-loss premiums are correspondingly higher.

Connecticut employers considering level-funded plans should note that the state has enacted legislation around surprise billing and balance billing that affects both fully insured and self-funded plans. The state insurance department also requires certain disclosures for stop-loss insurance products. Groups with 50 or more employees may find level-funded particularly advantageous, as they escape the small-group community rating requirements while gaining access to claims data that can inform future plan design decisions.

Frequently Asked Questions: Level-Funded Plans in Connecticut

Is level-funded health insurance available in Connecticut? +

Yes. Connecticut employers have access to level-funded health plans from carriers including UnitedHealthcare Level-Funded, Cigna Level-Funded, Aetna Funding Advantage. The minimum group size is typically 2 employees. Level-funded plans in Connecticut are treated as self-funded under ERISA, providing flexibility in plan design and potential savings.

How much can Connecticut employers save with level-funded? +

Based on Connecticut's average fully insured PEPM of $790 and typical level-funded discounts of 10%, employers can expect meaningful savings in the expected claims scenario. Best-case savings with surplus refunds can reach 20-30%, while worst-case exposure is capped by stop-loss insurance.

What happens if claims are higher than expected? +

Stop-loss insurance protects against catastrophic claims. Individual specific stop-loss covers any single claimant above the attachment point (e.g., $50,000). Aggregate stop-loss caps total group claims at 125% of expected. Your maximum exposure is predetermined and contractually limited.

What if claims are lower than expected? +

This is where level-funded shines. If your group's claims are below the funded amount, you receive a surplus refund. In Connecticut, typical surplus return provisions are 40-65% of unused claims fund. With fully insured plans, the carrier keeps the difference.

Which Connecticut employers are the best fit for level-funded? +

Level-funded plans work best for Connecticut employers with 2-250 employees, younger-than-average workforces, and a desire for cost transparency. Industries with lower claims risk (technology, professional services, education) often see the best results. The Connecticut market is classified as moderate for level-funded options.

Built on Real Data -- Not Guesswork

This calculator uses Connecticut-specific actuarial data, carrier rate filings, and published survey benchmarks.

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KFF Employer Survey

2025 benchmarks from 2,000+ employers on premiums, plan design, and funding type distribution

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SOA Claims Tables

Society of Actuaries group health experience studies for expected claims modeling by age and industry

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Stop-Loss Rate Data

Sun Life and Voya reference rate schedules for specific and aggregate stop-loss pricing by attachment point

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Connecticut DOI Filings

State-level rate filings, carrier market share data, and regulatory requirements from Connecticut's insurance department

Want a Custom Level-Funded Quote for Connecticut?

Get a side-by-side comparison with actual carrier quotes from UnitedHealthcare Level-Funded, Cigna Level-Funded, Aetna Funding Advantage -- reviewed by a benefits advisor who knows the Connecticut market.

Calculation Methodology

Fully Insured Cost: Current PEPM x number of employees x 12 months. Projected forward using the annual renewal increase rate.

Level-Funded Breakdown:
- Claims Fund: PEPM x claims ratio x state cost index (1.15 for Connecticut) x age factor x industry adjustment x plan tier multiplier. This is held in a claims account to pay medical expenses.
- Admin Fee: PEPM x admin percentage. Covers TPA fees, network access, compliance, and reporting.
- Stop-Loss Premium: Based on attachment point selected. Adjusted by Connecticut's stop-loss factor (1.12) and group demographics.
- Total Level-Funded: Claims Fund + Admin Fee + Stop-Loss Premium.

Scenario Modeling:
- Best Case: Actual claims at 55% of expected. Employer receives ~50% of surplus (unused claims fund) as a refund.
- Expected Case: Actual claims match the expected claims fund. Typical savings vs fully insured.
- Worst Case: Claims run 130% of expected, but stop-loss caps total exposure at 125% of expected claims fund.

State Cost Index: Connecticut's index of 1.15 adjusts base claims for state-level provider costs, utilization patterns, and regulatory environment. Based on CMS Geographic Practice Cost Index and Connecticut DOI rate filings.

Data Sources: SOA Group Health Experience Study, Mercer National Survey 2025, KFF 2025 Employer Health Benefits Survey, TrustMark/Voya level-funded reference data, Sun Life stop-loss rate manuals, NAIC stop-loss model regulations, CMS Federal Age Rating Curves, Connecticut Department of Insurance filings.

Connecticut Level-Funded vs Fully InsuredSavings Calculator