Level-Funded Health Plans for Washington Small Businesses
Is Your Business Overpaying for Health Insurance?
Washington small businesses faced an 11.9% average rate increase in 2025 — the highest in a decade. There is a smarter alternative: Level-Funded Health Plans.
Get a Free AnalysisThe Washington Rate Crisis Is Real
Washington small employers are facing relentless double-digit rate increases on traditional fully insured health plans. The WA Office of the Insurance Commissioner approved an average 11.9% increase for 2025 — the highest in a decade. Regence hit 21.9% in a single year. These increases are not slowing down.
Sources: WA Office of the Insurance Commissioner; Kaiser Family Foundation; UnitedHealthcare
What Is a Level-Funded Health Plan?
A level-funded plan is a hybrid between a traditional fully-insured plan and a self-funded plan — designed specifically for small to mid-size businesses. You pay a fixed, predictable monthly amount covering three components:
Claims Fund
Covers your employees actual medical claims
Stop-Loss Insurance
Protects you from catastrophic or unexpectedly high claims
Admin Fees
Covers plan administration and TPA services
Here is the best part: if your employees use fewer claims than projected, you get the surplus back at the end of the plan year. With a fully insured plan, that money goes to the carrier — not you.
Watch: Our broker explains level-funded plans and why Washington businesses are making the switch.
5 Reasons Washington Businesses Are Making the Switch
Level-funded plans offer the predictability of fully insured coverage with the cost-saving potential of self-funding.
Escape the Rate Spiral
Level-funded plans are not subject to ACA community rating rules. Your rates reflect your group’s actual claims history — not the broader market. Healthy groups pay less.
Year-End Surplus Refunds
If your claims come in under budget, you receive a refund at year end. That money stays with your business — not your insurance carrier. Many groups see thousands back.
Stop-Loss Protection
Stop-loss insurance caps your exposure at both the individual and aggregate level. You get the upside of self-funding without the catastrophic downside risk.
Full Claims Transparency
Unlike fully insured plans, level-funded plans give you real visibility into your claims data — so you can make smarter benefits decisions every renewal cycle.
Customizable Coverage
Choose from PPO, HDHP, and network-only designs. As self-insured plans, they are exempt from many state benefit mandates, giving you more flexibility in plan design.
Is a Level-Funded Plan Right for Your Business?
Level-funded plans are an ideal fit for Washington employers who:
- Have between 2 and 150 employees
- Have a generally healthy workforce with manageable claims history
- Are frustrated with annual double-digit fully insured rate increases
- Want cost transparency and visibility into their claims data
- Are open to a smarter, more flexible alternative to traditional insurance
- Want stop-loss protection without taking on full self-insurance risk
- Are based anywhere in Washington — Seattle, Bellevue, Spokane, Tacoma, or beyond
The Trend Is Clear — Small Businesses Are Moving
chose level-funded plans in 2024
to ~40% by 2023 (Kaiser Family Foundation)
Washington small businesses are disproportionately impacted by rising fully insured premiums. The National Federation of Independent Business calls health insurance costs “the number one problem for small businesses for 38 years running.” Level-funded plans are how smart employers are taking control.
Talk to a Washington Benefits ExpertGet a Free Level-Funded Plan Analysis
We will review your current plan, run the numbers, and show you exactly what a level-funded plan could save your Washington business — at no cost or obligation.
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