Private Exchanges Let Employees Decide What’s  ‘Affordable’

Private Exchanges Let Employees Decide What’s ‘Affordable’

For years, everyone’s been talking about affordable healthcare. But even in small- and mid-sized companies, employees will have different views about what “affordable” means.

In a law firm, for example, attorneys’ salaries are often two to three times higher than those of paralegals or legal assistants. Similar pay gaps exist between managers and supervisors and on-the-floor employees in restaurants, retail stores and manufacturing facilities.

And even if each employee received the same salary, there’s usually a wide variance in their household budgets depending on their mortgage or rent payments, family and financial obligations and a host of other factors.

Despite these differences, however, one-size-fits-all has been the predominant theme in employer-sponsored health benefits.  The Kaiser Health Foundation 2013 Employer Health Benefits Survey found that 88 percent of employers with fewer than 200 employees offer only one type of health plan. In addition, over the last 15 years, while workers’ earnings have increased by 50 percent, their contributions to premiums have risen more than 180 percent — a jump that has had the biggest impact on employees at the lower end of the pay scale.

Fortunately, however, as the Kaiser Health report also noted, the status quo is quickly changing. In the year before its survey, for example, 54 percent of firms had shopped for a new health plan or insurance carrier.  Many of those firms are considering private health exchanges, which offer employees various plans with a wide range of benefits, premiums and out-of-pocket costs.

A recent survey, for example, found that one-third of employers plan to move employees to a private exchange in the next few years. Another study reported the growth in private exchanges has been driven largely by smaller and midsize companies.

Private exchanges give employees a variety of choices and price points and let them control how they want to spend the benefit dollars contributed by their employers. Exchanges such as GlidePath also provide personalized decision-support tools and recommendations to help employees make informed decisions about premiums, deductibles and benefits.

In essence, private exchanges help employees find the right balance between affordability and coverage based on their specific needs and budgets. It’s not surprising that the Kaiser Health report’s conclusion noted that, “the emergence of new exchanges, or marketplaces, also may portend important changes for employer-sponsored health insurance.”

GlidePath

More than 50 Michigan employers and 12,000 people now use GlidePath, Blue Cross Blue Shield of Michigan’s private health care exchange. GlidePath offers companies an innovative way to manage spending and risk. It can transform the way you finance your company’s health insurance coverage. With GlidePath, you can determine your company’s health benefits budget and simplify the administrative work that goes along with offering health benefits. For more information or to request a quote, visit GlidePathBenefits.com.

Coverage for Companies

Coverage for Companies, operated by Blue Cross Blue Shield of Michigan, is an online private exchange for small groups with up to 50 employees. You determine an amount you’d like to spend on each employee’s health insurance coverage. Then, you select a collection of plans to offer your employees. We have HMO and PPO options. Your employees can then shop online and get help finding a plan that fits their needs.

 

For more information or to request a quote, visit bcbsm.com/exchange.