A common misperception among employers about private exchange solutions for their active employees is that they moving to an exchange means giving up control over their health care strategies and plans. According to Sherri Bockhorst, managing director of Towers Watson Exchange Solutions, this is not always the case.
While adopting an exchange does relieve employers of the day-to-day burden of managing their health benefits programs, some exchanges provide employers with the flexibility to configure their exchanges to meet their own business and organizational goals, says Bockhorst.
In a recent podcast interview with Brian Kalish, online managing editor of Employee Benefit Advisor, Bockhorst talked about the four pillars of a private exchange — choice, price transparency, decision support, and employee involvement — and explained the options that employers that have adopted OneExchange for their active employees have in each of these areas.
For example, when it comes to employee choice, employers can decide which carriers, how many plans, and what kind of plans to offer on their exchanges. In terms of price transparency, employers have the flexibility to adopt either a defined contribution model or a more more traditional payment model.
Bockhorst also pointed out that the assistance of an experienced advisor can help employers realize the full value of an exchange by asking the right questions to determine what kind of incentives, wellness programs, or other offerings they want to provide their employees.
To listen to the entire interview, click here.
U.S. Employers Expect Rate of Increase in Health Care Costs in 2015 to Remain Low, but Well Above Inflation
October 22, 2015
Employers expect a 4.1% rate of increase in the cost of employer-sponsored health care benefits in 2015 – the lowest in 15 years but well above inflation — according to an annual survey by global professional services company Towers Watson (NASDAQ: TW) and the National Business Group on Health (NBGH), an association of large employers.
Nervertheless, the survey found that employers are more committed to providing some form of health care coverage to employees over the next 10 years than they have been in recent years. Employer confidence in offering health care coverage 10 years from now has nearly doubled to 44% today from 25% in 2014.
“Against the backdrop of sluggish economic growth and low inflation – which limits the degree to which companies can raise prices on goods and services – employers continue to aggressively manage their health benefit plans to rein in costs,” said Randall K. Abbott, a North American leader and senior strategist in Towers Watson’s Health and Group Benefits practice. “By and large, employers have done a good job managing costs in recent years. Despite this success, the ACA’s excise tax looms ahead in 2018, and 4 out of 5 employers now identify changes to health and pharmacy plan designs as their most important strategic priority.”
For more information about what additional actions employers are considering to manage costs, and additional survey findings, read the entire press release here.