As private insurance exchanges are becoming a more popular option for companies, an understanding of employers' preferences is vital for health plans to succeed in the private exchange business, according to a survey of U.S. employers who have moved to these online marketplaces.
The Deloitte Center for Health Solutions conducted an online survey of 700 employers in February and March 2015 and found that only 8 percent of those employers who moved to a private insurance exchange (11 percent of respondents) were not satisfied with their current exchange. Most said the private exchange has had financial benefits, with only one in five finding their private exchange has not reduced costs of employee insurance.
The findings "suggest that employers are positive about private exchanges and their potential for decreasing costs, simplifying the employer's role in benefit administration, and providing employees with comparable, higher-quality coverage at a lower cost," the report said.
The online marketplaces allow employers to set a standard contribution rate for healthcare and have consumers shop for their own health insurance on the private exchange. Employers that had already implemented private exchanges were even more positive about them than those that have not adopted the model, the survey found.
Given the interest in private exchanges, "understanding employers' preferences and concerns will likely be crucial for health plans and other stakeholders in the private exchange business," the report said. Additionally, if private exchanges fulfill their expectations, they may have a major impact on health plans' role and value in the employer-sponsored market.
Further, industry experts say the private exchange industry is poised for growth and that the time is right for health insurance companies to get into the business. Private exchange enrollment reached 6 million in 2015, and is expected to reach 40 million by 2018, FierceHealthPayer has reported.
To learn more:
- here's the Deloitte survey