iSSUE || March/april 2013
Exchange
Endless Options Understanding How to Make the Best Choices Among a Complicated Array of Exchange Solutions Options Could Small Businesses Drive the Private Exchange Marketplace? Private Exchanges Are More than a One-Stop Shop for Benefits, They Bring Value Too Exchange Profile: Buck Health Exchange Solutions
www.theihcc.com
INSIDE
FEATURES
9 It’s All about the Value Private exchanges allow small and large employers to show employees the value of providing them health and voluntary benefits while containing costs. By Christopher Covill National Specialty Practice Leader and Partner Mercer Marketplace Exchange Initiative
11 The New Normal? Private exchanges offering individual plans are emerging as an ideal business solution for small businesses and may even become the norm. By David Lindgren Product & Compliance Manager Flexible Benefit Service Corporation
DEPARTMENTS 4
5
Publisher’s Letter
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Regulations & Compliance
Introducing HealthCare Exchange Solutions, the first magazine with concentrated coverage of exchanges and defined contributions.
Private exchanges may provide a transition to consumer-centered insurance while offering competitive coverage to large populations currently in or shut out of individual plans.
News Briefs
By Ronald E. Bachman FSA, MAAA Chairman, Editorial Advisory Board The Institute of Healthcare Consumerism
Keep up to date on new exchange innovations hitting the market.
14 Private Exchange Profile This inaugural issues features group health benefits, with an overview of RightOpt, a private health insurance exchange for self-funded and fully insured employers, offered by Buck Consultants.
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PUBLISHER
Exchange www.theihcc.com VOLUME 1 NO. 1 | MarCH/apriL 2013
HealthCare Exchange
published by FieldMedia LLC 292 South Main Street, Suite 400 alpharetta, Ga 30009 Fax: 770.663.4409
Solutions The emergence of health insurance benefits exchanges represents perhaps the most significant shift in how Americans purchase health insurance in many years. We’ve already witnessed a number of innovations by the industry recently, and more are sure to come. The exchanges, simply put, represent an important opportunity for advancing consumerism in health care. I am pleased to introduce to you, HealthCare Exchange Solutions, a magazine supplement to HealthCare Consumerism Solutions covering this momentous shift, focusing exclusively on exchanges and defined contributions. This supplement is a major addition to the commitment the Institute has given to understanding and discussing exchanges and defined contributions during the past year. In February we introduced a new online community, Exchange Solutions, and its accompanying e-newsletter. This year’s FORUM events will feature a number of timely exchange-related workshops and general sessions, and our weekly radio show, HealthCare Consumerism Radio, has recently featured many segments about exchanges. Through timely news coverage and analysis in this magazine supplement and related media and events, we aim to resolve many of the questions and concerns employers, brokers, consultants, and consumers alike have regarding exchanges. We will feature the opinions of many key players in the emerging exchanges. In this debut issue, we are proud to feature an article by Mercer, a global HR consulting leader which has added a key component to the private exchange arena with Mercer Marketplace, as well as Flexible Benefit Service Corporation, which, with its InsureXSolutions exchange, has made a considerable impact in the individual exchange market. In each issue, we will feature an Exchange Profile, which introduces a key exchange player to the market. For this issue, we profile Buck Consultants’ RightOpt exchange. Also, in each issue, you will find Regulatory & Compliance coverage, aimed at helping stakeholders understand the complex legal and compliance issues involved in moving into the exchanges. I believe this new array of editorial content will be of huge value to the industry. No one else has concentrated coverage of exchanges and defined contribution in a regular publication, written by thought-leaders and industry experts. We invite you to share your feedback and suggestions about the supplement and consumerism as we enter this exciting era of health care exchanges.
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Ronald E. Bachman, CEO, Healthcare Visions EDitOriaL aDViSOry BOarD
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™ Volume 1 issue 1 Copyright ©2013 by FieldMedia LLC. all rights reserved.
™ ™ is published eight times yearly by FieldMedia LLC., 292 South Main Street, Suite 400, alpharetta, Ga 30009. periodical postage
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4 March/April 2013 I HealthCare Exchange Solutions™ I www.TheIHCC.com
BRIEFS
PUBLIC EXCHANGES
CieloStar Launches National Private Exchange
Recent news from Washington, D.C. regarding delays in the small business functions of the federal exchange won’t affect Minnesota businesses because Minnesota is establishing MNsure, a state-based exchange, independent of the federal program. MNsure’s Small Business Health Options Program (SHOP) will allow small businesses to employ a defined contribution model for health insurance beginning in 2014. MNsure will also be able to distribute lump sums received from small businesses for employee health insurance to the insurance companies based on which plans the employees choose, easing the administration of providing health insurance for small employers.
CieloStar announces the launch of a broad health insurance and benefits exchange, leveraging 25 years of technology and programs to navigate the full range of health care and other benefits. Its new onestop exchange is called CieloChoice. CieloChoice allows employers, associations, affinity groups, and brokers to offer employees and members a one-stop online marketplace. Similar to travel websites that allow consumers to shop in one place, CieloChoice offers a variety of plans for consumers to choose from, including health, dental, medical, and vision. Coupled with competitive price comparisons, employees can create a plan based on their specific needs and budget. Combining its technology platform with its health benefits experience, CieloStar can simplify enrollment, engagement, and administration for both administrators and consumers.
PRIVATE EXCHANGES
InsureXSolutions Adds Assurant, Blue Cross Blue Shield of TX, and Humana to Portfolio
MNsure to Offer Small Businesses Competitive Health Insurance Options in 2014
Arizona Businesses Offered New, More Flexible Way to Purchase Health Care Coverage Blue Cross Blue Shield of Arizona has introduced a private health plan marketplace, available to Arizona employers, through a defined contribution plan. Employers set a fixed dollar amount they‘ll contribute to employees‘ health benefits, employees use the contribution dollars to shop the online marketplace and evaluate the ten plan options available. Employees pay toward the monthly premium only if their plan premium costs exceed the contribution set by their employer.
Buck Consultants Unveils RightOpt, a National Health Insurance Exchange Buck Consultants, A Xerox Company, plans to launch RightOpt, a private health insurance exchange for employers with 3,000 or more benefit-eligible employees for fall 2013 enrollment. RightOpt can help employers through health insurance provider relationships that are negotiated and managed by Buck. RightOpt allows employers to use a national network of providers based on the value each provider delivers in a specific metropolitan area. Employees located across the country access the more deeply-discounted networks of providers; a model many employers have avoided historically due to the administrative complexities. RightOpt personalizes the member experience based on family health status, adversity to risk, and preferences. A single access portal supports the personalization in three areas.
Capital BlueCross’ Private Exchange Working Well for Group Customers Capital BlueCross group customers are responding favorably to the company’s private health insurance exchange called MyCoverage Selector, which is powered by ConnectedHealth platform and launched in the fall of 2012. Miners Bank is one of the first Capital BlueCross employer groups to provide its workforce with health coverage through MyCoverage Selector. The easy-to-use online platform lets employees shop for and choose their health insurance from a wide range of options, using a set dollar amount (a defined contribution) from their employer. Employees have the flexibility to select the plan they prefer and receive the platform’s personalized recommendations.
InsureXSolutions recently announced these three insurers have joined the list of health insurance companies available through its exchange. The products from these carriers include individual health plans and offer a variety of premium and deductible options. InsureXSolutions offers small businesses a defined contribution benefits strategy. Employees access the online insurance marketplace to shop and compare plans from national, regional, and local individual health, dental, Medicare, short-term, and vision insurance companies. Employees interact with a decision engine that makes buying insurance coverage as simple as making an online travel reservation. Employees answer questions and set search parameters, and the decision engine helps them narrow down their choices to select a plan that best fits their budget, needs, and lifestyle.
PlanSource’s Exchange to Support a Defined Contribution Benefits Marketplace PlanSource, a cloud-based, on-demand technology company that provides benefits administration, payroll, and HRIS solutions to employers through its insurance carrier and broker partners, has announced the launch of MyPlanSource, a private health care and benefits exchange platform designed to support defined contribution retail benefits marketplaces. Employer shopping, employee shopping, personalized plan selection guidance and decision support, defined contribution, enrollment, plan administration, billing, and data management are all integrated in a single- or multi-carrier environment and delivered securely online.
Simplee and Liazon Creates the First Benefits Exchange with Expense Management Tools Simplee and Liazon announced a partnership to provide all Liazon Bright Choices Exchange users with integrated access to the Simplee health care expense management platform. This partnership forms the first private benefits exchange that allows consumers to both select a personalized benefits portfolio and then track and manage their health care expenses throughout the year. Liazon’s flagship product, the Bright Choices Exchange, is an online benefits store that helps employers save money on their health care costs by setting predictable budgets while allowing employees to personalize their benefits package with a selection of health, dental, vision, life, disability, and other benefits from top providers. www.TheIHCC.com I HealthCare Exchange Solutions™ I March/April 2013
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Take your business to a higher level with a cloud-based benefits marketplace. Consumers and employers alike will rejoice in a benefits marketplace that makes shopping for insurance easy and painless. With Workable Choice, employees are easily connected with the products that best fit their unique lifestyles. Our defined contribution options give employers the flexibility to deploy a benefits program tailored to their specific needs. With our one-invoice, single payment a solution, billing has never been easier. Workable Choice integrates flawlessly with your eligibility and underwriting guidelines, just the way you’d want it to. And we capture all the information your systems need to import enrollments and maintain eligibility, so you don’t have to worry about a thing.
Decision Support / Plan Cost Comparison Online consumer shopping experience Integrated educational and analytical tools Plan Recommendations and Cost Comparisons
Online Enrollment Data validation tools and custom pages to minimize enrollment errors Direct, electronic data exchange with plan providers Detailed activity and enrollment reporting
Eligibility Maintenance Portal access for admin, broker, employer, consumer Online management of employee adds, terms and changes Automated updates sent electronically (EDI) to all impacted providers
Consolidated Billing & Payment Management Single invoice, single payment for all employer sponsored benefits Direct bill/payment capabilities for individual benefits Detailed reconciliation and activity reporting for benefit providers
With our experts as your guide, launching a private exchange begins with a phone call and ends with your customized solution. Request a demo at WorkableChoice.com.
p: 800- 946- 6342
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W WW . W oRka bl eC h oiCe . Co M
REGULATIONS & COMPLIANCE
BY RONALD E. BACHMAN FSA, MAAA » CHAIRMAN, EDITORIAL ADVISORY BOARD » THE INSTITUTE OF HEALTHCARE CONSUMERISM PRESIDENT & CEO » HEALTHCARE VISIONS, INC.
Private Exchanges may Be the Free Market Solution to Cost Control and Health Care Consumerism Private exchanges may provide a transition from employer-based insurance to consumer-centered insurance while offering competitive coverage to large populations currently in or shut out of individual plans.
A
lthough the Patient Protection and Affordable Care Act (PPACA) is sometimes shortened to the Affordable Care Act or ACA, the act has few features that will make insurance more affordable. Government studies and industry experts has indicated that strict coverage mandates, limited premium classifications, community rating, added benefits, single risk pools, and price compression will raise premiums more rapidly than if the ACA had never been passed. The development of exchanges, both government and private, are part of an evolution that will change the way insurance is sold and bought. It is a new way of connecting products with customers. It may be that the main population using government exchanges are those who qualify for a federal subsidy. The standards and restrictions on government exchanges are likely to attract buyers that are high-risk and are high-cost claimants. The government exchanges will use government paid “navigators” rather than independent licensed agents. In addition, government exchanges and navigators are not expected to offer supplemental products, life insurance, or other such products and services. Private exchanges may be the free market solution to real cost control and lowering the number of people in the country that are uninsured. Given that there are nearly 50 million Americans uninsured, the traditional agent distribution system for insurance is not working. About 60 percent of the uninsured are under age 35. Studies conducted in Georgia by the Center for Health Transformation Uninsured Working Group, a former think tank founded by Newt Gingrich, found that 35 percent of the uninsured could afford insurance but did not know it. Another 40 percent needed lower cost options that were not available to them either because insurers emphasized high premium products, or because existing state laws or legislative mandates increased premiums and favored insurers over consumers. Many uninsured people work for small businesses that do not offer insurance. They may be self-employed, part-time, or doing contract work. In most cases, they qualify for individual insurance, not group plans. Selling single policies can be time consuming with little financial rewards for an agent. Many potential individual sales are halted at the kitchen table when, in the process of completing an application, they find issues that could cause insurers to decline to cover them and their family. Information derived by an insurer during the underwriting process is typically fed into an industry association called the Medical
Information Bureau. That information is shared across companies and a declined health application could have ramifications for future applications of life insurance, disability coverage, and other forms of insurance. Private exchanges are developing that will offer individual and group products that emphasize wellness and treatment compliance for those under medical care. PPACA requires insurers to “community rate” their products. That is, individual or small groups will not get direct credit for healthy activities. New entities are forming that will likely attract healthy lives and the less healthy members interested in getting better. Private health cooperatives, captive mutual companies, and new insurers may be unencumbered by an existing unhealthy membership or a current business model that limits attracting customers willing to be engaged in healthy behaviors. Health care consumerism is more likely to emerge through private exchanges than government exchanges. Private exchanges will provide a transition from employer-based insurance to individual-centered or consumer-centered insurance. In theory, both large and small employers will be able to purchase health insurance through the private exchanges, and their employees can choose an individual health plan from those offered by participating insurers. Time will tell. We are in the beginning stages of a major market revolution. We already know that small business government exchanges as originally planned have been delayed one year until 2015. As private exchanges come on line, I believe each will each be a little different and offer varying levels of products and services. For a while it will be a “wild west” show. Ultimately, the success and failure of each exchange’s product and distribution model will lead to consolidation and better products, services, convenience, help, and information for the consumer. In the end, more product competition and price transparency will lead to more citizens being insured and lower insurance costs will prevail. This is the way free markets create successful products and services that consumers want to buy.
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A Full-Service Private Exchange Is all about Its Value to Both Employers and Employees
BY CHRISTOPHER COVILL » NATIONAL SPECIALTY PRACTICE LEADER AND PARTNER » MERCER MARKETPLACE EXCHANGE INITIATIVE
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n a today’s benefits landscape, the changes enacted through the Patient Protection and Affordable Care Act (ACA) are profound for employers and employees as health care reform introduces new levels of complexity and choice that require new and dramatic solutions. As the rising cost of health care has become a challenge for all stakeholders, public policy has shifted along with the responsibility for managing cost and risk. During the last 20 years, the evolution from defined benefit to defined contribution (DC) in retirement plans
has provided a model whereby the DC approach to health insurance benefits funding now can be deployed. This shift limits the openended costs of traditional arrangements and gives employers more control over future premium cost increases. A key tenet of the ACA is the establishment of public exchanges to allow Americans to directly purchase health insurance. This has also been the impetus for the emergence of private exchanges, which allow employers to offer ACA-compliant health insurance with a new efficiency, providing access to a range of health plans along with a full
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suite of employer-sponsored and voluntary benefits. The private-exchange mechanism for delivering health insurance benefits can greatly facilitate the transition to a DC model — a key value proposition for employers — while empowering employees to build their individual benefit risk portfolios, a clear value to themselves and their families. The private exchange market is growing quickly, as a number of players, including Mercer, have introduced private marketplaces for both large and small firms. The Mercer Marketplace, for example, stocks core and voluntary products across many benefits types and is available to employers with as few as 100 and as many as 100,000+ employees. For employers and employees, such a private-exchange model delivers on the value proposition vital to both groups by: 1. Allowing both the employer and the employee to realize the economic benefit of negotiated costs and services 2. Providing overall cost transparency, including full visibility of the employer’s contribution to the employee’s benefit costs Together, these have the combined advantage of creating a positive perception for the organization and its workforce. In the case of The Mercer Marketplace, the solution enables employers to deliver a total benefits package to employees, with the advantages cited above. The solution offers a comprehensive range of benefits including core medical coverage, supplemental coverage (including gap programs), traditional benefits (such as life, disability, dental, and vision) and ancillary benefits (such as home and auto, group legal, identity theft, and even pet insurance). These benefits are provided and managed through a state-of-the-art technology platform that include intuitive, user-friendly online enrollment applications, coupled with decision-support tools for calculating cost and the types of plans (PPOs, HMOs, high-deductible consumerdirected plans, etc.) that will best meet the needs of individual employees and their families. Private exchanges drive a consolidated efficiency that can be realized in reduced internal and external expenses. For example, exchanges offer employers: t an enrollment protocol that is supported through a call center staffed by seasoned, salaried, and licensed benefit 10
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counselors, thus relieving pressure on human resources and benefit staff within the organization who are often challenged to counsel employees on benefit specifics and choices enrollment functionality and technology support streamlined administration of benefits, including integration with payroll systems, eligibility management billing services
A full-service private exchange model is all about its value and how it translates to both the employer and employee. For employers, a private-exchange solution facilitates the transition to a DC strategy for benefits, providing full transparency with regard to an employer’s total contribution to its employee’s benefits package, helping to create a more positive employee perception of the employer, which plays a proven role in enhanced employee engagement and productivity, as well as the retention of key talent.
In addition, by consolidating and streamlining benefits management and reporting, the private-exchange model provides competitive benefits while reducing the traditional burden of managing them in-house. Moreover, enhanced employee perception is achieved by empowering employees to personalize their risk portfolios through a seamless technology platform supported by call-center professional benefit counselors, reinforcing the employer’s continuing commitment to providing valuable benefits. It’s worth reemphasizing the bottomline value proposition for employers. Cost efficiencies of the private exchanges are derived from the streamlined administrative aspects, as well as from the competitive brokering and bundling of all benefit products. Efficiencies also accrue as employees’ benefit-buying behavior leads them to less costly plans. And finally, the
DC funding model is a clear advantage for employers in the benefits marketplace. Employees tend to have three buying profiles when it comes to making benefit choices. There are those who: 1. Like to “Do it yourself” 2. Prefer that someone “Do it with me” 3. Want the organization to “Do it for me” The private-exchange strategy works for all three of those constituencies, empowering each of them to build their own portfolios of personal protection. Support for these employee types is achieved through a combination of the intuitive, user-friendly nature of a private-exchange technology platform and the personalized service of the benefit counselors staffing the call center. Both methods provide employees greater visibility into the costs and financial options. For many, this education process will lead to the realization that they can reduce their medical coverage and costs while still protecting their out-of-pocket exposure — with, for example, supplemental medical gap coverage. It all points toward an enhanced employee appreciation of their employer’s financial and service commitment to them. This improved employee perception will be reinforced by the clear cost-efficiency employees can realize from reducing their overall medical spending by balancing insurance costs and out-of-pocket risks in constructing their personal benefits portfolios. The goal is for employees to become more effective and efficient health care consumers. Ultimately, private exchanges can provide a meaningful long-term solution for the challenges that persist in the health-andbenefits landscape, but the value of private exchanges must be clear to both employee and employer. For employees, that value proposition is driven not purely by an employer’s financial contribution and by access to a benefits platform, but also — and perhaps more so — by the strong sense that the employer has a continuing commitment to employees’ security, to their evolving needs, and to the availability and affordability of quality health benefits. That is a sustainable proposition bred from values as much as from the transactional notion of value.
The Largest
(Small) Business Segment Is Adapting to Private Exchanges
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BY DAVID LINDGREN » PRODUCT & COMPLIANCE MANAGER » FLEXIBLE BENEFIT SERVICE CORPORATION (FLEX)
he most talked about subject in the health insurance industry since the Affordable Care Act (ACA) was passed is the exchange. This critical component of the ACA will serve as the backbone for millions of individuals and families to purchase health insurance coverage. The public exchanges are expected to be open for business starting October 1, 2013. Only individuals and small businesses will have access to public exchanges initially. Although they will be supported by federal and/or state funds, they will offer private insurance plans from local and regional insurance companies.
with retirees, or mid-sized groups (500+), looking for group health benefits.
Public Exchanges for the Big (Small) Marketplace
Private exchanges, on the other hand, are operated by private companies, such as insurance companies, brokerages, or tech-based firms. Many private exchanges are already operational today and provide significant flexibility for businesses. These exchanges typically target specific market segments, such as large groups (1000+)
Public exchanges may be the fallback for many small businesses, which have no requirements to offer health insurance under the ACA, but are impacted significantly by its requirements otherwise. Small employers will eventually have the option of the Small Business Health Option (SHOP) exchanges, which are intended to assist small businesses provide affordable group health insurance options for their employees. Once the public exchanges are www.TheIHCC.com I HealthCare Exchange Solutions™ I March/April 2013
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www.buckconsultants.com
In today’s economic climate, properly managing your health care plans helps both your people and your bottom line. But finding the time and the resources can be a challenge.
Buck can help. Together with Xerox, we: • Touch two out of every three insured Americans who use health care annually • Process 900 million health care claims every year • Have contracts with 36 state Medicaid organizations
• Provide RightOpt™, our private health insurance exchange, to manage costs for both you and your employees • Supply Accountable Care Organization technology to 2000+ hospitals • Support every major insurance carrier
By leveraging our experience across the health care industry — from providers and payers to employers and government agencies — you can make your health care plans more accessible, affordable, and efficient. To learn more, visit www.buckconsultants.com
will require personal assistance to understand, filter, and compare their options. Exchanges that provide t .PTU TUBUF HPWFSONFOUT EFmOF TNBMM CVTJOFTTFT BT UIPTF decision-support tools to aid FNQMPZFST XJUI VQ UP FNQMPZFFT employees in their shopping t /FBSMZ NJMMJPO PVU PG B UPUBM NJMMJPO CVTJOFTTFT JO experience may achieve the best UIF 6 4 BSF DPOTJEFSFE TNBMM CVTJOFTTFT BDDPSEJOH UP results. For example, our private UIF MBUFTU EBUB GSPN UIF ,BJTFS 'BNJMZ 'PVOEBUJPO exchange — InsureXSolutionsŽ t "O BTUPOJTIJOH QFSDFOU PG UIF PWFSBMM CVTJOFTT — is integrated with a Plan NBSLFUQMBDF JT DPNQSJTFE PG TNBMM CVTJOFTTFT Finder for employees to assist t 0OMZ 35.7 percent PG TNBMM CVTJOFTTFT OBUJPOXJEF PGGFS them to navigate the individual insurance marketplace. IFBMUI JOTVSBODF UP FNQMPZFFT DPNQBSFE XJUI This smart, online resource QFSDFOU PG CVTJOFTTFT XJUI PS NPSF FNQMPZFFT provides personal guidance to individuals and families shopping allow the employer to cap their costs and for insurance coverage. Through a series provide a fixed dollar amount to employees of questions answered by the individual, to purchase insurance coverage. Whether the Plan Finder matches insurance plans Marketplace Uncertainty Currently, the majority of those small it’s provided with pre-tax or after-tax dollars, to his or her specific needs and lifestyle. businesses that offer health insurance this approach changes the employer’s role in Taking less than one minute to complete, the outcome of this interactive process recomprovide fully-insured group health insurance the delivery of health benefits. Rather than dealing with administrative mends insurance plans based upon cost, plans to employees. Employees receive a package of group insurance options, which burdens and other logistical issues, the benefit levels, coverage needs, insurance may include health, life, disability, dental, employer’s role in providing health insurance company, and more. From there, employees vision, and more. The employer selects the to employees is significantly decreased with apply online for the insurance plan that fits group health insurance options available for a private exchange. They simply set a health them best. their employee population and pays for all or care budget, establish a relationship with a private exchange, and let their employees do The Future Is Bright a portion of the group health plans. Many small businesses originally had the rest. Some private exchanges even have Today, the individual insurance applicathought they would stop offering health a dedicated team that is available to assist tion process still includes medical underinsurance in light of the ACA. Although some employees through the enrollment process. writing and taking a medical history, which Whether the employer contributes $50 insurance companies use to assess rates for may still pursue this as an option, many small businesses have increasingly changed or $500 per month, there are no require- consumers to pay for their individual health their opinion. A recent small business survey ments or restrictions for the employer to con- insurance plans. Starting in 2014 underwritindicated that two-thirds of small business tribute a specific dollar amount to employ- ing will be eliminated, making all individual owners say they will continue to offer insurance ees. The employer just needs to make sure health insurance plans guarantee issue. they provide the same contribution amount to employees. For those small businesses uncertain Although the number of small busi- to similar employee populations, with some about their future health care strategy, a nesses offering employees insurance has classification types allowed. private exchange offering individual plans The employee can then use the funds as can be that ideal business solution. In fact, grown since the ACA was signed into law in 2010, there is still a lot of skepticism in the part of their individual or family health care there are whispers that private exchanges marketplace. Many small businesses are budget. That’s where the private exchange may quickly become the norm for small still unclear of how it will impact them and comes in. The intent of the private exchange businesses. what they will need to do to comply. In fact, is to provide a simple, seamless health care When we think of “big business,� we the small business survey found that more shopping and purchasing experience for usually think of businesses with thousands than half of the respondents incorrectly the employees through an online insurance of employees. As private exchanges grow believe they must provide health insurance marketplace. This business solution avoids in popularity, and that trend continues as to employees or be penalized. However, the “one size fits all� benefits approach and we head toward 2014, it’s actually the small the new law will not require businesses creates a win-win experience for employers business employer that may redefine the with fewer than 50 employees to provide and employees alike. way we look at the big business of health insurance nor will they be subject to any insurance. penalties. Employee Choice Is Key Many private exchanges offer employees, The Benefits of Private Exchanges for through their employers, the ability to shop online for health, dental, vision, Medicare Small Businesses With the emergence of the ACA, many Supplement, and other insurance plans. And, small businesses may quickly adapt to private since many employees will be navigating exchanges. Many private exchange models these insurance plans as consumers, they available to small businesses, initially they will be able to offer only one plan to employees in most states. The Department of Health and Human Services (HHS) recently delayed the availability of expanded SHOP exchanges until 2015. This defeats one of the primary goals of the ACA — to provide more plan choices. Since the SHOP exchanges are being delayed and small businesses have no requirements to offer health insurance under the ACA, individual plans may be the ideal solution for their employees.
The Majority of Small Businesses do Not Offer Health Insurance to Employees
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PRIVATE EXCHANGE PROFILE
Group Health Benefits RightOpt: A private health insurance exchange for self-funded and fully insured employers, offered by Buck Consultants, A Xerox Company. Leadership Sherri Bockhorst is the principal and leader of Buck Health Exchange Solutions, Buck Consultants. RightOpt, together with Xerox, positions Buck to support all three segments of emerging public and private health exchanges: government, payer, and employer. Xerox is administering Medicaid programs in 36 states and the District of Columbia, and providing technology and services support to the 20 top commercial health plans in the U.S.
Solution Benefits Buck explains that its solution is designed to reduce health care spend and trend by placing continued downward pressure on health care delivery and improving employee health, not just transferring costs from an employer to its employees. It also states that both employers and employees will benefit from RightOpt’s decreased health care costs, increased member engagement, and improved business results. A summary of RightOpt’s solution benefits includes: t Buck Consultant’s preferred partner strategy regionally aligns provider networks based on quantitative criteria, including network breadth, provider discounts, unit cost guarantees, and quality. It plans that this “quilted network” approach will deliver savings of up to 10 percent on eligible charges for the employer the first year. Employers offer this national network of providers to employees based upon the value each provider delivers in a specific metropolitan area. Employees located across the country would access the more deeplydiscounted networks of providers; a model many employers have avoided historically due to the administrative complexities. t It negotiates program expenses for a suite of services integrated into the exchange, including pharmacy benefit management and wellness programs. This negotiated purchasing for volume-based contracting allows its clients to use unit cost and pricing that improves for all participating employers as its exchange membership grows. t It leverages the Xerox Palo Alto Research Center (PARC), alongside its data warehouse partner, to expand its ability to make evidence-based decisions regarding what actions truly drive outcomes and incorporates these recommendations to drive incremental value. A current research team is working to identify the effectiveness of emerging trends in health care such as gaming theory and technology — drawing upon PARC’s research in social computing, behavior analytics, and ethnography.
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Its portfolio of plan designs and incentive structures can be customized to fit an employer’s organizational culture and meet its needs. Using a single access point portal, RightOpt personalizes the experience for each member based on his/her health, adversity to risk, communication preferences, and readiness for change, and engages the participant throughout the year on all health-related decisions. Members choose a preferred plan options at enrollment, use those options throughout the year, and work to improve or maintain their health risks over time. The portal includes educational information, decision support tools, and health engagement resources to encourage more informed decisions. Additional services for the employee, including lifestyle coaching, employee assistance programs, and member advocacy, are available to help participants stay on track to reduce health risks. Buck’s communicators develop a communication program to support the implementation of RightOpt, introducing employees to the exchange and encouraging them to take advantage of the tools and services available throughout the year to help them make more informed decisions about their overall health and well-being. The member-facing portal integrates disparate vendor systems behind the scenes to ensure participants have access to the information they need from a single location.
Bottom Line Buck Consultants states the goal of RightOpt is to create a sustainable, benefit delivery platform built on its belief that the health of a business is dependent upon the health of its employees.