Reports and Surveys | April 22, 2021

Medical Stop-Loss Coverage: Premiums Up 8% for 2021

This infographic looks at health plans' medical stop-loss coverage for the 2021 policy year. 

It analyzes data from 239 plans, with 2,200 covered participants per group on average. 

Segal has maintained its National Medical Stop-Loss Database since the ACA eliminated annual and lifetime dollar limits on essential health benefits. 

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Key findings on medical stop-loss coverage

Our latest analysis found that: 

  • There was an 8 percent average premium increase for all stop-loss insurance policies in Segal’s 2021 dataset as a result of aggressive negotiations.
  • A large majority of plans — 94 percent — have purchased broad coverage that covers medical and prescription drug claims.
  • Among plans that bid or renewed their stop-loss coverage, 86 percent stayed with the incumbent insurer.
  • High-cost claimants with $100,000+ paid claims per year account for less than 1 percent of all claimants but 25 percent of total medical plan claim expenses in a typical year.

Why medical stop-loss coverage?

As the number and value of high-amount claims continues to grow, stop-loss coverage provides important asset protection and cost predictability, particularly for self-funded plans, smaller groups and those with modest cash reserves.

The rapid rate of change in newly approved medical technology and procedures requires a close inspection of the coverage language offered by each stop-loss insurer. Segal experts carefully review stop-loss contract provisions to make sure policy language aligns with a plan’s coverage needs so sponsors can secure coverage that meets their expectations.

Questions about medical stop-loss coverage?

To discuss the adequacy and competitiveness of your plan’s stop-loss coverage compared to plans in Segal’s 2021 dataset, get in touch. 

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This page is for informational purposes only and does not constitute legal, tax or investment advice. You are encouraged to discuss the issues raised here with your legal, tax and other advisors before determining how the issues apply to your specific situations.

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