Who typically arranges payment for claims in a self-funded plan?

In a self-funded plan, it is the employer that directly assumes the financial risk for providing health care benefits to its employees. Instead of purchasing a traditional insurance policy from an insurance company, the employer pays for medical claims out of its own funds. This arrangement allows the employer to have more control over the benefits offered and the costs incurred, potentially leading to significant savings compared to fully insured plans.

Employers typically work with third-party administrators to help them manage claims processing, but the ultimate responsibility for paying the claims lies with the employer. This means that when employees incur healthcare expenses, it is the employer who arranges payment for those claims. In essence, the self-funded model shifts the financial liability from an insurance company to the employer, giving them greater oversight of the plan's costs and underlying strategies.