Determining if a Private Health Exchange is Right for Your Business
Private health insurance exchange enrollment increased by 35 percent in the first half of 2016 (as compared to 2015), according to global professional services company Accenture. But, as the buzz on private exchanges increases, you may be wondering if a private exchange is right for your business. According to the Society for Human Resource Management (SHRM), when employers consider a move to a private exchange, they usually focus on three areas: finance, administration, and the experience of employees/enrollees. Financial considerations include plan option costs, the financial stability of the exchange (its history and experience), fees, financingl transparency, and fully insured group options. The administrative priorities include exchange administration and claims advocacy, implementation assistance, data and reports, health and wellness programs, fees, and financing transparency. Employee experience priorities include ease of use, years of experience and track record, employee communication support, integration of claims and case management with the employer’s existing portal (or ease of establishment of a new benefits portal), call center and instant chat capabilities, and portal integration with external providers. A private exchange is a convenient way for employers of any size to manage their benefits. But smaller businesses may be particularly attracted to a private exchange because it offers:
- a unique way to control costs (through the use of Defined Contribution),
- increased choices for employees and dependents, and
- guaranteed compliance with Affordable Care Act compliance regulations.
A private exchange can also streamline benefits administration by offering online enrollment, a single bill for coverage, one website for employee support, and one toll-free number for service and answers to employee questions. A private exchange approach utilizing Defined Contribution offers your business an easy way to forecast. If you’re setting your contribution to your employees’ health care premium based on a fixed dollar or fixed percentage of plan costs, it’s easy to predict your future expenses. Moving to a private exchange also relieves you of the burden of making the wrong plan choice for your employees. Instead, you’re able to give employees (and dependents, if applicable) a broader array of health care choices. With a private exchange, you can offer multiple health care options – and, often, ancillary benefits, too – giving employees the ability to mix and match based on their specific health care needs and budget. And, all the while, you’re able to reduce (or at least rein in control) on your health and benefits expenses. Ask your CaliforniaChoice broker about whether a private exchange is something that could help your business.