TaxBandits Knowledge Base

What is self-insured coverage under the ACA?

Self-insured coverage under the Affordable Care Act (ACA) refers to a type of health insurance plan that an employer provides to its employees, which doesn’t require purchasing a traditional health insurance policy from an insurance company.  

In other words, the employer sets aside funds to pay for its employees' healthcare expenses as they happen. This means that the employer takes on the responsibility of paying its employee's medical bills rather than having an insurance company do it. 

However, Self-insured plans are still subject to specific regulations under the Affordable Care Act (ACA), such as the requirement to cover essential health benefits and prohibit discrimination based on pre-existing conditions.