Private Health Exchanges: Explained Simply
The Affordable Care Act has given new life to the term “Private Health Insurance Exchange”, so much so that some people may think that private exchanges are a new phenomenon. The truth is that Private health insurance exchanges have been around for years (The CaliforniaChoice private exchange began in 1996.) So, you may be asking, “What exactly is a private exchange?” Here’s a quick overview:
|Question||Private Health Exchange|
|Who runs the exchange?||Private exchanges are operated by benefit brokerages, employee benefits consulting firms, and other companies (including privately backed firms like CHOICEAdministrators, which operates the CaliforniaChoice exchange).|
|Who uses the exchange?||Businesses who want to offer their employees a greater selection of coverage options. Medicare-eligible retirees may also be offered coverage through a private exchange.|
|Are subsidies available?||Companies offering coverage to employees (and their eligible dependents) typically offer a fixed contribution amount toward the cost of health insurance chosen by the employee||.|
|Does the exchange offer different health plans?||Some private exchanges limit group choices to a single carrier, but give employees the option to choose from multiple plans offered by that carrier. Other private exchanges, like CaliforniaChoice, give employees the ability to choose from a selection of carriers and plans (though all family members need to be insured through the same carrier and health plan).|
Contact a CaliforniaChoice broker if you want to know more about private health insurance exchanges.