In an inpatient contract that uses per diem unless total charges exceed $200,000, which stop-loss design would you add?

• A. Second-Dollar Stop-Loss Based on a Dollar Threshold
• B. First-Dollar Stop-Loss Based on a Pre-Defined Dollar Threshold
• C. Per-Diem Only Clause
• D. Global Cap Stop-Loss

Answer: (B)

When a plan mixes a per-diem approach with a defined spending trigger, you want a stop-loss that activates right at that trigger and begins covering costs from the first dollar of charges beyond it. This is the idea behind a first-dollar stop-loss based on a predefined dollar threshold. In this scenario, up to the threshold (the 200,000 total inpatient charges), costs flow as per diem. Once that threshold is crossed, the stop-loss attaches and starts paying from the first dollar of additional charges, helping prevent runaway costs immediately after the trigger.

Why this fits best: it preserves the per-diem mechanism up to the 200k point, then switches to a stopping mechanism that limits further exposure without leaving a gap in coverage. Other options either delay coverage beyond the trigger, keep using per-diem without transitioning to a stop-loss, or apply a separate global cap that doesn’t necessarily start with first-dollar responsibility right after the threshold.