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Blue Cross Blue Shield of Michigan Study: Private Exchanges Lowering Employer Costs, Changing Employee Enrollment Behavior
bcbsm
| 4 min read
According to an analysis of GlidePath, Blue Cross Blue Shield of Michigan’s private health insurance exchange, employers and employees are benefitting from use of the private exchange by empowering employees as informed consumers of health care coverage. The analysis showed Glidepath increased employee cost awareness, encouraged employees to make effective cost choices to meet their needs, and strengthened knowledge and adoption of Health Savings Accounts (HSAs). Here are the findings:
- There was a dramatic increase in awareness of costs. While only 38 percent of employees in general are aware of what employers pay for health benefits on their behalf, 94 percent of employees using Glidepath were aware of their employer’s benefit contribution. The cost transparency delivered through GlidePath increased knowledge, involvement and awareness of health care costs.
- Employees had a greater tendency to choose plans with lower premiums and higher deductibles. After reviewing the multiple plans available on GlidePath, 79 percent of employees self-selected plans with deductibles of at least $1,000, two times the national average.
- Employees were more interested in enrolling in Health Savings Accounts. Employees have not traditionally selected HSAs, however, those using GlidePath, enrolled in HSAs at four times the national average.
Glidepath provides employers with a new way to deliver health care benefits to employees. Employers using Glidepath set a defined contribution amount and their employees use those funds to actively shop online to select a health plan using the exchange. The findings – published in a BCBSM white paper analysis of Glidepath, the state’s first and largest private exchange - are particularly significant in light of a recent estimate by Accenture, a leading management consulting firm which shows that the number of Americans enrolled through private exchanges will grow from the current three million Americans to an estimated 40 million Americans buying coverage on private exchanges by 2018. “With Glidepath, the number of employees aware of the cost and value of their employer’s health benefits jumps to 94 percent. Private exchanges are not only changing the way employees shop for plans, they are increasing consumer engagement and accountability, changing the way consumers use their benefits,” said Ken Dallafior, executive vice president, Commercial Business for BCBSM. According to Kaiser, 87 percent of companies offer only one health plan option to employees. This one for all approach leaves many employees with a plan that, unsurprisingly, doesn’t fit. GlidePath gives employees more choice with up to 10 health plans plus dental and vision options. They then actively ‘shop’ every year for a plan. And when confronted with increased choice, members enrolled through the GlidePath exchange are weighing their options and making trade-offs in order to choose benefits that best meet their own personal financial and coverage needs. Employers have historically struggled to gain employee adoption of health savings accounts. As a result of the one-on-one support GlidePath provides through non-commissioned advisors who help guide and educate members on health plan options and match them with a plan that best meets their needs and preferences – members are enrolling in health savings accounts at a rate over four times the national average. In 2011, Blue Cross introduced GlidePath as an additional way to help businesses manage the increasing cost of health care – putting employees in the driver’s seat to make benefit choices. Private exchanges have two facets – defined contribution financing and an online ‘shopping’ platform. This allows employers to predict and control costs by setting a defined allowance for employees and choosing a pre-configured menu of benefits. Employees then pick a plan from that menu using an online shopping platform, with decision support that assesses lifestyle and health care use information to provide personalized recommendations for each employee. About Blue Cross Blue Shield of Michigan Blue Cross Blue Shield of Michigan, a nonprofit mutual insurance company, is an independent licensee of the Blue Cross and Blue Shield Association. BCBSM provides and administers health benefits to more than 4.4 million members residing in Michigan in addition to employees of Michigan-headquartered companies who reside outside the state. For more company information, visit bcbsm.com and MiBluesPerspectives.com. About the GlidePath Private Health Exchange GlidePath, operated by Blue Cross Blue Shield of Michigan, is Michigan’s premier private health exchange solution. Introduced in 2011, GlidePath has experienced five-fold growth over the past several months by providing cost predictability to employers and greater choice to employees. GlidePath combines defined contribution financing with a private exchange platform. Members receive one-on-one support during and after the benefits enrollment process. For more information regarding the GlidePath private health exchange, visit GlidePathBenefits.com. About 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. Photo Credit: thinkpanama
