In this episode of Captivating Health Insights, host Maddison Bezdicek welcomed back Dave Gillis, Managing Director, Medical Stop Loss at Captive Resources, to kick off a mini-series on captive education. The conversation focused on a key inflection point for many employers: transitioning from fully insured to self-funded — and how captives offer a more supported, strategic path into that model.
Drawing on extensive experience, Gillis outlined the foundational components of self-funding, including third-party administrators (TPAs), networks, and pharmacy benefit managers (PBMs), while highlighting the limitations of fully insured plans. At its core, the discussion reinforced a central idea — self-funding is not just a funding mechanism, but a shift toward greater control, transparency, and long-term strategy.
The episode also addressed common misconceptions around risk, explained how captives act as a “soft landing,” and explored how employers can begin to more actively manage healthcare spend without overcomplicating their approach.
Fully insured plans are often a bundled product with limited flexibility. In contrast, self-funding allows employers to unbundle key components and take a more strategic approach — designing plans that better align with their population while actively managing cost drivers.
Rather than navigating self-funding alone, employers in a captive gain access to a broader ecosystem — including peer collaboration, shared insights, and dedicated resources. This structure helps reduce barriers to entry and supports more informed decision-making over time.
A common misconception is that self-funding is too risky. In reality, stop-loss coverage protects against catastrophic claims, while captives introduce additional stability through risk-sharing. For many employers, the greater risk lies in remaining fully insured without visibility or control.
Self-funding provides access to detailed claims data, allowing employers to understand what care actually costs. This visibility enables more informed decisions, helping identify inefficiencies and opportunities to improve both cost and quality.
Pharmacy is often the most immediate opportunity for impact. With the right strategy, employers can evaluate high-cost drugs, leverage biosimilars, and capture rebates — often generating meaningful savings early in the transition.
Employers evaluating self-funding are typically shown multiple scenarios — including worst-case, expected, and best-case outcomes. This approach provides a clearer understanding of risk while highlighting the potential to participate in savings.
Transitioning to self-funding doesn’t require doing everything at once. Employers can start with core components and build over time, using a “crawl, walk, run” approach that balances impact with operational simplicity.
With greater control over plan design and care navigation, employers can better support employees — particularly those with complex conditions — improving both outcomes and overall experience.
This recap highlighted key insights from the conversation on moving from fully insured to self-funded and the role captives play in that transition. Listen to Episode 15 of Captivating Health Insights to hear Gillis break down the process and share practical strategies for employers exploring a more transparent, strategic approach to managing healthcare spend.
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