The self-funded model of employer-sponsored insurance (ESI) continues to grow, a new study in Health Affairs has found. The study says that self-funded insurance plans—which means the employer collects premiums and bears responsibility for paying claims—rose from 55 percent of the market in 2015 to 60 percent of the market in 2021. Most of the growth came in states that previously had a lower share of self-funded plans, but the model saw growth across most states.

"We found that the nationwide increase in the prevalence of self-funded ESI was widespread, with most states (88%) and counties (78.2%) experiencing an increase in prevalence from 2015 to 2021," the study says. The study notes that this model carries more risk for employers as sponsors of health plans, and that they may be at a disadvantage when negotiating for lower prices. In addition, the study adds, researchers and policymakers lack data when studying these questions, since ERISA laws exempt self-insured plans from many state regulations.

The Majority of Enrollees Are in Self-Funded Plans Across 80% of U.S. Counties  

The study says that for employer-sponsored insurance plans, a majority of enrollees were in self-funded plans in 2,532 counties in the U.S. in 2021. In addition, 475 counties (15.1% of counties) had more than 75 percent of ESI enrollees in a self-funded plan, while only 85 counties (2.7%) had fewer than 25 percent of enrollees in a self-funded plan.