Cannabis employers have spent years adapting business systems built for other industries. Employee benefits have been no exception.
Limited carrier appetite, banking constraints and fewer funding options have often left cannabis companies choosing from whatever was available rather than evaluating healthcare the same way other established employers do.
Fortunately, the market is starting to change.
For qualifying cannabis employers, the conversation can now move beyond simply finding coverage to how the health plan is financed, where the money is going and what can be done during the year to manage cost.
Coverage is only part of the decision
For years, access was the immediate problem.
If an employer could secure a workable health plan and get through renewal, that was progress.
But coverage alone does not answer some of the questions that become more important as a company grows:
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How much of the premium is actually paying claims?
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What is driving pharmacy and medical spend?
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What happens when claims perform better than expected?
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What resources are available when a high-cost claimant begins to emerge?
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And how much control does the employer have over any of it?
Those are important healthcare management questions to condsider, not simply insurance questions.
Why a group captive changes the conversation
Humboldt Health is Blackwell Captive Solutions' group medical stop-loss captive built specifically for cannabis employers.
Participating employers self-fund a portion of their healthcare costs, share a defined layer of risk with other cannabis companies, and retain stop-loss protection against larger claims.
For qualifying groups, the model creates more visibility into how healthcare dollars are being used and the potential to participate in surplus when the captive performs favorably.
Humboldt Health starts at 25 enrolled lives, making the structure accessible to smaller employers that historically may not have considered a captive.
The risk pool is also made up specifically of cannabis employers.
That matters because cannabis is understood at the beginning of the relationship. It is part of the structure being underwritten.
Built around cannabis-specific constraints
Healthcare financing does not exist separately from the banking realities cannabis companies still face. Collateral is a good example.
Captive participation requires employers to demonstrate their ability to meet certain financial obligations. Traditional structures may use an irrevocable letter of credit, which can be difficult for cannabis businesses because of banking restrictions.
Humboldt Health uses defined cash collateral instead.
It is a relatively small structural detail with a larger point behind it: the program was designed around how cannabis employers actually operate.
Managing cost during the year
Financing healthcare differently only goes so far if the underlying claims continue to rise.
That is why B.Well Blueprint is included with Humboldt Health.
The program is designed to identify emerging risk and address high-cost claim drivers during the plan year, giving employers and brokers more time to act before those costs simply appear in the renewal.
The goal is to connect how healthcare risk is financed with how that risk is managed.
A different conversation for a more established industry
Cannabis employers are competing for people, expanding across markets and managing many of the same healthcare cost pressures facing employers in every other industry.
Their benefits options are beginning to reflect that reality.
For brokers, the question is no longer limited to whether a cannabis employer can find coverage.
It is whether the current structure still makes sense for the company it has become.
Blackwell President Scott Byrne recently discussed that shift with MG Magazine, including why Humboldt Health was built, how the captive works and where cannabis-specific issues such as collateral influenced the program design.
Read the full MG Magazine feature: Rethinking Healthcare Benefits for Cannabis Employers.
Have a cannabis client evaluating its healthcare strategy? Learn more about Humboldt Health.