Choosing Between Funded and Scheduled Plans

Which plan should you choose? HealthRabbit aims to offer service in a way that suits your business and employee needs. If you need more information to help decide, you're in the right place.

Funded Accounts

  • Access to the lowest processing fees we offer
  • Monitored and optimized to ensure lowest funding amount possible with fastest processing available
  • Recommended if you have employees outside of your family members

Funded accounts are the best way to ensure that you and your employees receive claims reimbursements as fast as possible. HealthRabbit assesses your account and sets a high and a low threshold for you to maintain allowing immediate payout of claims. When the low threshold is reached, we'll invoice you to replenish the funds to the high threshold. 

How do we assess the thresholds? For now, we will multiply your employees by the tiers you have set and set the top threshold at 15% of that total. The low will be set at 6%. Over time, we expect to fine tune this formula, possibly with different thresholds during different times. For example, we may increase thresholds for the first quarter as your staff file a backlog of claims, or near the end of the calendar year when there is a rush to get things in before tax time. We will work each of our clients to find the right balance of funding to provide the best possible service with the least amount of capital tied up. With more time, we expect we will learn how different industries and types of businesses utilize our service and be able to target these levels more accurately.

Managing Your Assets

Money sent to HealthRabbit as pre-funding is still your asset and is kept in a separate account from our operational accounts. The money remains fully liquid and is not invested anywhere else while in our care. Our goal is to only pre-fund what is needed and so we should not be sitting on large amounts of your money. There is no interest paid on your funds and if you decide to leave HealthRabbit, all pre-funding not required for processing claims or for fees will be returned. 

Pros and Cons of Pre-Funding

The two main pros of funding your account are the speed in which claims can be processed for you and your employees and access to lower fees for processing. Funding also comes with a slightly lower enrolment fee and more employee sign-ups are included in that fee. 

The obvious downside of pre-funding your account is that you now have a company asset that is unavailable to your business. If you're a small company, having even a small amount of capital tied up can be challenging. If you need to start on a scheduled plan, you can move to pre-funded anytime.

Recommended For

Funded accounts are recommended if you:

  • Are an established business with steady cash flow or cash reserves
  • If you have employees that are not immediate family members

Scheduled Accounts

  • No pre-funding required. Ideal if cash flows are inconsistent or seasonal.
  • Invoices sent on a schedule allowing for consistency and planning.
  • Slightly higher fees and slower processing times
  • Ideal for solo-entreneurs, contractors, or consultants that only need to process claims for themselves and their families.

Pros and Cons of Scheduled Plans

Scheduled solutions are ideal for businesses where the impact of claims processing schedules is not a priority or where managing cash flow is integral. Businesses may choose to start with a scheduled plan and upgrade to a funded account as they grow. If you're an independent contractor, you may only need to deal with health claims once or twice a year. If that's the case, we'll simply invoice each month or each quarter that you have a claim based on your preferences.

There are two potential downsides to a scheduled plan: Rates are higher than our funded programs but still very competitive and claims will take much longer to process as we have to invoice and get paid before we can release the claim reimbursement. Depending on your business and needs, these may be very acceptable tradeoffs.

Recommended For

Scheduled accounts are recommended if you:

  • Are an independent contractor or solo-preneur
  • If you need to manage cashflow tightly
  • If you only plan to manage health claims a few times per year

Questions About Which Funding to Choose?

If you still have questions about funding choices, please contact us and we'll do our best to help you out. 

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