Commission for Case Manager Certification (CCMC) Exam 2025 – 400 Free Practice Questions to Pass the Exam

In the context of large companies, being self-insured means that the company assumes the financial risk for providing health care benefits to its employees rather than purchasing a traditional insurance policy from an insurer. When a company is self-insured, it can effectively manage its own health benefits and is responsible for paying health claims out-of-pocket.

Hiring a third-party administrator to handle claims is a common practice among self-insured companies. This arrangement allows companies to take advantage of the expertise of administrators who specialize in managing health benefits, processing claims, and ensuring compliance with healthcare regulations. The administrators can streamline the claims process, assist with medical management, and provide data analytics to help manage health care costs more efficiently, thereby allowing the company to focus on its core business activities while still providing health benefits to its employees.

This understanding of self-insurance is crucial because it reflects a company's strategy in managing risk and containing costs related to employee health benefits. The other options do not accurately capture the essence of self-insurance, as they either refer to limited scopes of insurance, offer incorrect interpretations, or imply a lack of management strategies that are actually vital in self-insured setups.