Human resource professionals are likely aware of the task associated with researching, selecting and managing their company’s health benefits, not to mention communicating or handling any issues that may arise. This responsibility can be burdensome, especially in smaller-sized companies where HR personnel are required to juggle multiple aspects of the business.
Private exchanges may offer businesses and their HR teams a solution to their employer-sponsored benefit needs. By shifting to a private exchange, companies are able to reduce many of the time-consuming administrative tasks involved in health plan enrollment. Private exchanges offer an online enrollment process that clearly explains plan options and allows employees to select coverage that fits their individual needs. Private exchanges also offer employee support during enrollment.
Will private exchanges help reduce costs?
Many employer-sponsored plans offer one-size-fits all coverage, where every employee is provided with essentially the same plan that may or may not fit their specific needs.
With a private exchange, employers decide how much they want to contribute to employees for health care and select a variety of health plan options to offer them. Employees then use their employer’s contribution to buy a health plan that fits their personal needs.
When employees have a fixed-dollar amount to spend and many health plan choices with differing benefits and price tags, they typically will purchase coverage that is less costly than the coverage they previously had, as they attempt to maximize the dollars available to purchase insurance coverage. This “buy-down” effect results in lower insurance premiums in the first year of the private exchange.
Blue Cross Blue Shield of Michigan offers two private exchange options that can help ease your company’s administrative duties and free up more time to focus on running your business. To learn more, visit the Blue Cross private exchange webpage. For more information about private exchanges, check out the blogs below or visit our LinkedIn page.
- Coverage for Companies: The Private Exchange Focused on Smaller Business
- The Small Business Owners Guide to Private Exchange
- Private Exchanges Cater Perfectly To the Restaurant Industry
About the Author
Jason Hover is vice president of Private Exchange for Blue Cross Blue Shield of Michigan. He’s responsible for driving the company’s strategy and solutions in the private exchange market, which includes developing the company’s proprietary GlidePath℠ private health insurance exchanges. Hover also leads strategy development for the Blue Cross Commercial Business division. Hover joined Blue Cross in 2009 and previously served as director of Commercial Business Strategy and director of Strategy and Planning.