Seek balance, perspective when considering a private exchange plan

By Chris Hanson-Ehlinger
Fri, Mar, 14, 2014 @ 16:03 PM
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Moving your health care benefits to a private exchange is a big decision. Unfortunately, the information available to help guide your decision is confusing.

For example, a blog came across my desk last week summarizing the results from a “groundbreaking” survey of employer attitudes regarding private exchanges. It stated more than 80 percent of employers had no interest in pursuing an exchange strategy. On that same day a second blog arrived at a completely different position.  It reported 35 percent of employers were moving towards a private exchange in 2015 and 50 percent were strongly considering an exchange in 2016.

Why the difference? Consider the source documentation: the first author cited survey results conducted by a broker of benefit services and products. The second survey was sponsored by national benefit consulting firm which also sells its own private exchange solution to employers. The lesson is clear. As you review surveys, articles or position papers about private exchanges, consider the source. 

A private exchange may or may not be the right fit for your organization. Following are a few suggestions to help you reach the best possible outcome.

Independence

Rely on advisors without a significant financial interest in your decision. Brokers and consulting organizations active in the exchange marketplace may not be your best option. Instead:

  • Look for independent benefit consultants

  • Seek out industry peers and consider the strategies they may be evaluating

  • Use your personal network of professional organizations and their publications to gain an unbiased recommendation

Context

Moving your employee benefit plan to a private exchange is not an all or nothing proposition. Many employers take a far more selective approach. As an example, some employers consider exchanges for a limited portion of their population, such as pre-65 retirees. Exchange solutions are only one of several strategies available when providing benefits to your plan participants.

Politics

The Affordable Care Act (ACA) is certain to be a key issue in 2014 politics. Political banter may range from expanding ACA to fixing the Act’s current challenges to repealing the legislation altogether.  Designing benefit plans based on predictions of political outcomes is imprudent. Make your plan decisions with the knowledge that change is inevitable and maintaining flexibility is essential.

Moving to an exchange, in whole or in part, could be the right decision for your plan, or the wrong one. Give a call if you’d like help evaluating your options.

Craig Oberg, RPh, is a managing consultant at The Burchfield Group. He works with national employers to develop PBM assessment and strategic management plans. For more information, please call The Burchfield Group at 800-778-1359 or send us a note (http://www.burchfieldgroup.com/contact/).

Copyright © 2014 The Burchfield Group. All rights reserved. No part of the content contained herein may be transmitted, redistributed, copied, stored, downloaded, abstracted, disseminated, circulated or included as part of any other service or product. For all permissions, please contact chanson-ehlinger@burchfieldgroup.com

 

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