Your Guide: Private Health Insurance Exchanges

PRIVATEYOUR GUIDE: HEALTH INSURANCE

EXCHANGES

Drag picture to placeholder or click icon to addToday we’re going to look at “private

health insurance exchanges.”

THEY’RE PRIVATE. THEY’RE

EXCHANGES.

This has been a frequent buzz phrase in the health insurance industry

over the past couple of years for a number of different reasons.

The biggest reason though, is HEALTHCARE REFORM.

Whole new

ballgame.

With the implementation of new

provisions in the Affordable Care

Act, the way that employers offer

health insurance to their employees

is changing.

We’ll take a look at the structure of private health insurance exchanges, and how they work.

So buckle your

seatbelts.

We’ll also describe the different

components that make-up a private health

insurance exchange, the types of

businesses that should be taking the

closest look at these exchanges, and why

they’re growing in importance.

…They’re exchanges that

are set up privately through

an employer.

PRIVATE HEALTH INSURANCE EXCHANGES ARE EXACTLY WHAT THEY SAY THEY ARE:

No help from the

government.

#1) Technology and

software.

#2) Group health

insurance plans.

Many private health insurance exchanges utilize TWO important components:

There are two.

LET’S TAKE A CLOSER LOOK A THESE TWO CONCEPTS. THEY PLAY A

PIVITOL ROLE IN THE STRUCTURE OF “PRIVATE HEALTH INSURANCE

EXCHANGES.”

Software programs help facilitate

administration of private health

insurance exchanges.

This technology keeps the private exchange

concept simple for both the employer and

the employee.

#1: TECHNOLOGY AND SOFTWARE.

Time to tech

up.

One example is www.liazon.com.Liazon’s platform allows an employer to “define a contribution”

(much like an allowance), and then employees select their own

health benefits.

SIMPLY: Employees decide on the plans that fit them best.

You pick your

plan.

Like a store.

The software keeps track of funds

spent, and also shows the

employee what kind of health

insurance options are available at

the private exchange.

THERE’S AN INTERACTIVE PLATFORM TO WORK WITH ONLINE.

NOW THAT WE KNOW THAT TECHNOLOGY AND SOFTWARE ARE THE FIRST

IMPORTANT COMPONENT OF PRIVATE HEALTH INSURANCE EXCHANGES, LET’S

TAKE A LOOK A THE SECOND.

#2: GROUP HEALTH INSURANCE PLANS.

People had limited

choices.

In the past, many employers only

offered one group health insurance

plan.

Why?: Because administration of multiple

plans could be a challenge.

THE IMPORTANT WORD HERE IS MULTIPLE.

More than one.

So to fix that problem, software companies

(like Liazon) now have arrangements with

insurance companies that allow employers

to offer multiple group health insurance

plans from multiple carriers more easily.

With the software and technology

that’s available, it’s not nearly as

difficult to offer a selection of

group health insurance plans

anymore.

ONE OF THE BIGGEST GOALS OF PRIVATE HEALTH INSURANCE EXCHANGES IS TO PROVIDE CHOICE.

PRIVATE EXCHANGE =

EMPLOYEE CHOICES.

…But businesses with +50

fulltime equivalent employees

will almost always be utilizing

the two concepts we’ve just

described.

There are additional ways to set up private health insurance exchanges…

Mandated employers: THAT’S

YOU.

And certain smaller businesses can also work with this exact same strategy…

Tune in.

…So if you’re a business that is at 20

employees or above, you’ll want to

understand the concepts in this

presentation.

As we’ve mentioned, private health insurance

exchanges provide choice. So instead of being

“stuck” in one group health insurance plan,

employees can more efficiently choose which

plan fits them (and their family) best.

QUESTION: WHY ARE PRIVATE HEALTH INSURANCE EXCHANGES BECOMING MORE IMPORTANT?

Everyone is

different.

Having choices is now more important than ever before…

THAT’S IMPORTANT.

…Because dependents (spouses and children) will most

likely need to be able to participate in the plan.

If employees’ dependents have access to an

“affordable” group plan, they DO NOT have access to

public health insurance exchange subsidies.

In the past, sometimes it was flat-out too expensive for an employee to include their dependents.

Affordable options.

The private health insurance exchange concept

helps alleviate that issue.

Dependents will need to have better access to group

health insurance plans in the post-reform

environment.

Additionally: businesses with +50 fulltime equivalent employees are mandated to provide coverage.

More predicable.

A private exchange is a cost-

effective and budgetable way for

employers in the “large group”

category to provide coverage.

You decide on the amount. It’s called a “defined contribution.” It’s just like an allowance.

That was easy.

You give that amount to

each employee.

Then they pick the plan

they want.

Lastly: Efficiency. If employees are making their own decisions and picking their own plans…

Smart consumers.

…The whole system runs more

efficiently.

Instead of you telling them what they get: they

pick what they want. By making choices, they’ll

be more conscience about where money is

being spent.

AS MENTIONED, PRIVATE EXCHANGES CAN BE AN EXCEPTIONALLY IMPORTANT CONCEPT FOR

BUSINESSES IN THE +50 EMPLOYEE RANGE. THEY ACCOMPLISH THREE VERY IMPORTANT

THINGS: #1) BUDGETABLITY, #2) SELECTION, #3) FLEXIBILITY. THOSE QUALITIES WILL BE VERY

IMPORTANT TO BUSINESSES MANDATED TO PROVIDE COVERAGE.

And that’s the basic breakdown of private health insurance exchanges.

Your money. On-

site.

Unlike public health insurance exchanges

(state and federal exchanges), private

exchanges are completely administered

within the private workplace.

We work with private health insurance exchanges at Policy Advantage Insurance Services.

And that’s a wrap.

If you’re an employer that is interested in

learning more, contact us anytime for further

information. Thanks for stopping by today.

We hope you found our information to be

valuable.

TYSON J LESTER, RHU, REBC

President, Policy Advantage Insurance Services

Toll Free: (800) 617-0089

Los Angeles Area: (424) 442-0170

Email: info@policyadvantage.com

www.policyadvantage.com | CA Insurance License #0F22799

ARTICLE WRITTEN BY

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Toll Free: (800) 617-0089

Los Angeles Area: (424) 442-0170

Email: info@policyadvantage.com

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