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Vendor says 'Freedom Choice' MERP can lower premiums but shifts mid‑layer risk to county
Summary
Freedom Choice representatives outlined a medical expense reimbursement (MERP) umbrella with a $6,000 deductible that can reduce premiums but would require the county to fund mid‑layer claims and could remove pharmacy rebates; presenters gave break‑even and worst‑case illustrations.
Representatives from Freedom Choice explained an alternative funding structure (a medical expense reimbursement plan) that would use a high‑deductible umbrella policy and a designed underlying plan for employees.
Julie, the Freedom representative, described the mechanics: the county would purchase a $6,000 umbrella policy and the underlying employee plan could mimic current benefits. She summarized tradeoffs: "You're reducing that liability from a 125,000 down to the 6,000," she said, meaning the group’s per‑claim attachment point is lower under the MERP construct but the county would be responsible for claims in the middle layer between the employee out‑of‑pocket and the umbrella deductible.
Freedom Choice’s illustrations showed lower fixed premium components in some scenarios but a meaningful employer maximum liability in worst‑case scenarios; presenters also noted that fully insured quotes under this model remove pharmacy rebates and change the renewal math. The vendor said employer groups typically build reserves in favorable years to smooth spikes and that design choices (copays, coinsurance) are configurable under the umbrella structure.
