HealthCare Exchange Solutions

Exchange

www.theihcc.com

September/October 2013

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Criteria to Consider When Exploring

Private Exchanges

Small Employer Private Exchanges:

Wherefore Art Thou?

Public vs. Private: The Regulatory Dialectic

Navigating Exchanges and Vision

Benefits

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ANNOUNCING

FEATURE

11 Navigating Private Exchanges and Vision Benefits

By January 1, 2015, small businesses with 50 or more full-time employees must offer their employees health care insurance that is in compliance with the Affordable Care Act (ACA). To help reduce overhead and simplify the administrative process for the newly required coverage, health insurance exchanges (or marketplaces) were created to allow companies and individuals to shop for health care in one place online.

By Terri Wilson, Senior Vice President and General Manager of Strategic Partnerships and International Development, VSP® Vision Care

INSIDE

4 Publisher’s LetterCEO Doug Field covers the latest in the private exchange and defined contribution industry and what’s happening at the Institute around exchanges

5 News Briefs & InnovationsKeeping you up-to-date with the latest news, research and innovations in defined contribution and health insurance exchanges

7 Regulatory & Compliance: Public vs. Private: The Regulatory Dialectic

As public and private exchanges compete in the “survival of the fittest” race, both bring to the table enormous power and money. The power of the federal government and its taxing authority versus the power of private capital and American ingenuity. While 34 states have rejected setting up a state-run exchange, more than twice that many have launched or are expected to launch private state or regional exchanges before the end of the year.

By Elena Merino, President/CEO, The Meridian Group

8 Exchange Profile: Digital Benefits Marketplace Saves Employers Money and Provides Enhanced Consumer Experience

The emergence of private exchanges provides employers with an entirely new approach to employee benefits that will help them control rising costs through defined contributions. In addition, these marketplace solutions foster deeper consumer engagement, setting the stage for the next evolution in the benefits industry. As employees assume greater financial responsibility for health insurance, our nation will move toward a consumer-driven system.

By Bob Gaydos, Principal and National Director of Private Marketplaces, Digital Benefit Advisors

9 Editor’s Perspective: Walgreens Announcement, Recent Surveys Point to Future of Private Exchanges

With the September 18 news that Walgreens was moving over 160,000 lives into the Aon Hewitt Corporate Health Exchange, the shift toward greater consumerism in health care was thrust into the national spotlight. Walgreen Co.’s

adoption of Aon Hewitt’s private exchange is the 18th such adoption by a large U.S. employer. As far public announcements go, Aon is inarguably outpacing the field early on.

By Jonathan Field, Managing Editor, The Institute for HealthCare Consumerism

10 Special Announcement: Introducing PrivateHealthCareExchanges.com

On September 23, to meet the need for a guide to private exchanges and defined contribution solutions, The Institute for HealthCare Consumerism announced the beta launch of PrivateHealthCareExchanges.com, the only online directory aimed at providing employers, health plans, brokers, consultants and consumers with the information to navigate this new market.

DEPARTMENTS

www.TheIHCC.com I HealthCare Exchange Solutions™ I September/October 2013 3

Health Insurance Exchanges – Both Public

and Private – Set to Take Center Stage

In the past few weeks, both public and private health insurance exchanges have been garnering national headlines, and for perhaps the first time, private exchanges have really been grabbing the nation’s attention. While their more widely publicized counterparts have been at the center of national debate for some time now, more and more Americans are beginning to understand the value and innovation coming from private exchanges.

On September 18, Walgreens announced that they would move 160,000 lives into Aon Hewitt’s private exchanges — a huge step forward for consumerism in health care. Private exchange and defined contribution strategies represent perhaps the greatest opportunity for employers to manage their health costs while empowering their employees that we’ve seen in years, and the trend of U.S. employers shifting their employee populations to a private exchanges has barely begun. This is only the tip of the iceberg.

The Institute for HealthCare Consumerism is actively promoting this shift in health and benefits in a number of ways. At our December conference, FORUM West, we will be featuring a variety of exchange-specific content. With Alegeus Technologies, we will delve into recent survey data on private exchanges and defined contribution during a pre-conference “lunch and learn.”

I will be moderating a panel, “Exchanges or Marketplace? Whatever it’s Called, Get to Know It,” with leading private exchanges experts John Reynolds, Cielostar; Josh Hilgers, Health Partners America; Shandon Fowler, Benefitfocus; and more.

At the end of day one, we will be hosting another panel, “Defined Contribution and Public/Private Exchanges: a Panel Discussion with Leading Experts” with Chris Covill, Mercer; Cindy Gillespie, McKenna Long & Aldridge; John Park, Alegeus Technologies; and more to come. FORUM West will provide the industry’s first real-time look at this fall’s historic open enrollment. We hope to see you there.

Additionally, to help employers, brokers, health plans and consumers navigate private exchanges, we are excited to introduce PrivateHealthCareExchanges.com, the only online guide to private exchanges and defined contribution solutions.

Thanks again to all of our contributors to this fourth edition of HealthCare Exchange Solutions — Elena Merino, The Meridian Group; Terri Wilson, VSP Vision Care; and Bob Gaydos, Digital Benefit Advisors — and to all our readers, we hope to see you at FORUM West.

Sincerely,

Doug FieldCEO/[email protected]

www.theihcc.comVOLUME 1 NO. 4 | SEPTEMBER/OCTOBER 2013

Published by FieldMedia LLC292 South Main Street, Suite 400

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CEODoug Field

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MANAGING DIRECTOR Brent Macy

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EDITORIAL ADVISORY BOARD

Kim Adler, Allstate; Diana Andersen, Zions Bancorporation; Bill Bennett; Doug Bulleit, DCS Health; Jon Comola, Wye River

Group; John Hickman, Alston+Bird LLP; Tony Holmes, 0HUFHU�+HDOWK��%HQH¿WV��0DUF�.XWWHU��$ÀDF��

Sanders McConnell, TSYS Healthcare; Roy Ramthun, HSA Consulting Services LLC; John Young, Consumerdriven LLC

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BUSINESS MANAGERKaren Raudabaugh

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PUBLISHERExchange

4 September/October 2013 I HealthCare Exchange Solutions™ I www.TheIHCC.com

NEWS BRIEFSTowers Watson Signs Agreement With Federal Government to Facilitate Public Exchange EnrollmentsTowers Watson, a global professional services company, announced that it has signed a web broker entity agreement with the Centers for Medicare & Medicaid Services, which supervises the federally facilitated marketplace — the health insurance exchange operated by the federal government in 36 states. With this agreement, Towers Watson can help employers provide health insurance education and enrollment services to part-time and seasonal employees, retirees and their dependents by supporting them as they evaluate and purchase individual health plans on the federally run exchange.

Benefit Advisors Network Announces Private Exchange Partnership with LiazonBenefit Advisors Network (BAN) — a national network of progressive and independent employee benefit firms — has partnered with Liazon, operator of the Bright Choices Exchange®, to deliver a private exchange solution to their clients. Employer clients will be able to offer this exciting new online marketplace to their employees. The Bright Choices® Exchange is an online benefits store that is changing the way employers and employees buy benefits. Bright Choices allows employees to personalize their benefits package with a selection of health, dental, vision, life, disability, and other benefits from top national and regional providers.

Medical Mutual of Ohio Builds Private Exchange with Benefitfocus Marketplace Technology Medical Mutual of Ohio has selected leading cloud-based benefits software provider Benefitfocus to build a private insurance exchange for both group and individual market segments. Benefitfocus Marketplace Technology creates a full-service online private insurance marketplace for Medical Mutual to adapt their strategy as public exchanges come into play on January 1, 2014. Medical Mutual’s private exchange will be designed to allow the insurance carrier to integrate with the Federally Facilitated Marketplace (FFM). This integration is intended to create a seamless consumer-centric shopping experience, allowing individuals eligible for government assistance to apply subsidies to their purchases within the Medical Mutual Marketplace.

Eastbridge Survey: Carriers Weigh in on Private Exchanges, Including Broker Needs and Voluntary ProductsIn a recent survey conducted by Eastbridge Consulting Group, Inc. titled “Health Care Reform: Private Exchanges & Voluntary Frontline Report,” carriers indicated that brokers are increasingly looking to their carriers for help in navigating through the new private exchange environment. The carriers claim that brokers want advice not only on product options and sales strategies, but also on new regulatory, compliance, and tax impacts for their clients. Carriers also believe that brokers will need to become more consultative in their approach with clients. In their opinion, it will become more about offering a wider array of products and more communication overall. Carriers believe that all sizes of brokers will be involved in the private exchange market, but that larger brokers will be earlier adopters of technology and change.

Federal Government Selects ConnectedHealth to Offer Qualified Health Plans via the Federally Facilitated MarketplaceConnectedHealth, the first consumer-focused e-commerce platform offering a robust benefits marketplace, has announced that it has been selected by the Centers for Medicare and Medicaid Services (CMS) to provide qualified health plans (QHP) to eligible consumers via the Federally Facilitated Marketplace (FFM), the federal government’s online health insurance marketplace. As a result of this agreement, ConnectedHealth will provide the most comprehensive range of health insurance shopping options — including private plans and plans available in the state or federal marketplace — to help employees who have employer-sponsored options, those shopping for individual coverage, and those who may qualify for a subsidy.

HealthPartners Launches Plan for Me Private Exchange SolutionHealthPartners has announced the launch of its new private exchange solution, Plan for Me, designed to keep costs in check for employers while providing more choice and simplicity during the open enrollment process for members. For employers, Plan for Me is easy to administer and available with no hidden fees. Plan for Me supports several prepackaged plans, including new defined contribution and performance network options. Employers can also offer custom plans with this shopping tool.

Health Partners America Adds New Updates To Private Exchange Broker BlueprintHealth Partners America has recently come out with updates to their Private Exchange Broker Blueprint, a tool that better prepares insurance professionals to understand Obamacare and prepare themselves to help individuals and employers secure the best health care plans quickly and easily using defined contribution and/or private exchanges. With all the changes in the world of health insurance, America’s employers need highly educated agents to help them navigate the new hurdles and roadblocks being thrown in their direction. Health Partners America has provided a tool aimed at agents to do just that: the Private Exchange Broker Blueprint.

Highmark and Array Health Form Partnership as MyBenefits Defined Contribution Platform ExpandsHighmark Health Services has announced that it is making its MyBenefits defined contribution health insurance platform available to more businesses in more locations by forming a long-term strategic partnership with Seattle-based Array Health. Highmark Health Services’ long-term agreement with Array Health extends the relationship through 2015. It also includes an investment in Array Health by Highmark. MyBenefits started in 2011 as a pilot program that quickly gained momentum throughout 2012 and 2013 with small and mid-sized businesses (under 100 employees) seeking to manage their group health coverage costs, while providing their employees with more choices. Due to its success, Highmark is making it available to large group businesses.

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BY ELENA MERINO » PRESIDENT/CEO » THE MERIDIAN GROUP

REGULATORY & COMPLIANCE

A s public and private exchanges compete in the “survival of the fittest” race, both bring to the

table enormous power and money. The power of the federal government and its taxing authority versus the power of private capital and American ingenuity. While 34 states have rejected setting up a state-run exchange, more than twice that many have launched or are expected to launch private state or regional exchanges before the end of the year.

The regulatory dialectic has been most prevalent in the banking industry.1 While the Glass-Steagall Act was enacted in 1933, decades later the law was repealed and signed into law in 1999 under the Financial Modernization Act.2 Then after decades of alternate attempts to restrict and loosen financial oversight of these institutions, the gov-ernment stepped to in to save the very same institutions that it sought to direct through regulations. Will insurers be the next “too big to fail?”

We have no doubt reached the high point in the regulatory dialectic in the health insurance industry. Will the ACA and its regulations ultimately result in robust and sustainable public and private exchanges? Will employers retreat or embrace public or private exchanges? While the promise of tax subsidies by the government to individuals may divert much of the individual consumer business to public exchanges, the two-year tax credit incentives for businesses with less than 25 employees will clearly be short lived.

The delay of employee-level option by the federal SHOP exchanges and the limited medical and ancillary options available to small employers in the SHOP — along with the short-lived small business tax credit — will likely result in an upswing and immediate downswing in the public exchange option for small businesses. As such, SHOP exchanges that anticipate allowing larger employer groups to participate may not make it until 2017 to see this growth.

Selecting and managing employee benefits, no matter how easy it is to “shop,” is a year-long financial and administrative commitment for employers that must not only select the best plans for their employers but must deal with employee-level questions and concerns that only the small employer or its broker would still have to address. Cafeteria (or 125) plans must continue to be set up and managed by employees in order to allow pre-tax expenses by employees. Account-based health plans, such as HSAs and HRA plans, to encourage the efficient use of services, engagement and accountability must all be integrated along with the insured health plans to control cost. Finally, unless brokers and agents get involved with SHOP exchanges, chances are employers will have go at it alone or pay a benefits advisor on a fee-based basis.3

4 As brokers’ and agents’ commissions continue to get reduced by employers due to the Minimum Loss Ratio (MLR), many brokers may have no choice but to charge a fee.

The promise of private exchanges is great but carrier and general agent exchanges that seek to promote certain carriers may not get the attention of independent brokers or employers or

regulators. While eHealth stunned the market by becoming the first private exchange to partner with the federal exchange, eHealth had to agree to offer customers any plan available on the federal exchange, regardless of whether it has a commission agreement with that carrier.5

Similarly, private exchanges must be ready and able to accept “any willing [insurance] provider” and be willing and able to communicate with existing employer systems if they are truly to add value and not add confusion. While professional employer organizations (PEOs) and Exclusive Provider Organizations (EPOs) have a place, employee-level choice and defined contribution calls for an open model that allows for multi-carrier, multi-employer systems solutions. Limited carrier exchanges that provide great decision-support tools and enrollment features may offer the best plans for the employer today — but not tomorrow. Likewise, while the best payroll services in the country may also offer Administrative Services Only (ASO) option, will they be willing/able to share data with private exchange providers?

Employers need to consider that moving between private exchanges, especially those that offer to defined contribution and/or exclusive payroll providers will not be easy — not only from a technical point of view, but from a financial and compliance point of view. Employer reporting in one year will require data from the prior year, which may not only span two plan years, but two contribution strategies and changing account-based plans.

Alas, if private exchanges are to survive and �ourish, they must take into account changing market participation, plans and pricing by insurers as well as employers’ existing systems and outsourced vendors. They must compete on service not with proprietary source codes. If hospitals are ready to move to open source EHR software, so must the industry that supports it. ____________________________________________________________

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Public vs. Private: The Regulatory Dialectic

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http://www.clevelandfed.org/research/commentary/1996/021596.htm

http://aishealth.com/archive/nhpw090511-02

http://www.bloomberg.com/news/2013-07-31/ehealth-wins-agreement-to-sell-obamacare-health-insurance-plans.html

http://www.bloomberg.com/news/2013-07-31/ehealth-wins-agreement-to-sell-obamacare-health-insurance-plans.html

http://www.bls.gov/opub/mlr/2012/03/art4full.pdf

PRIVATE EXCHANGE PROFILE

While private exchanges are a strategy many businesses will consider, because these options are new, for some it will be difficult to determine which alternative best serves their needs. Testimonials from other companies, case studies and historical evidence will be miniscule — or nonexistent.

Against this backdrop, how can you compare choices? When exploring options, here are some questions to ask and criteria to consider:

Does the decision support include access to qualified benefits counselors via telephone, e-mail or online chat?Does a dedicated benefits administration team provide all the needed support on behalf of the employer — or is the system merely self-service?Does the marketplace offer a wide of array of products and services beyond health insurance? And can the contribution system be designed to promote additional products and services?Is the marketplace available to employers all off sizes, including small and mid-sized companies? And can the marketplace be offered to provide ancillary benefits only?

Digital Benefit Advisors (DBA), a division of Digital Insurance, has launched Digital Benefits Marketplace, a private exchange that encompasses all of the criteria above. This sophisticated marketplace provides a comprehensive array of benefits, as well as a consumer experience unlike anything yet available.

Digital’s system is based in a framework that has functioned for more than a decade. The company already has the infrastructure, operational capability and distribution systems to effectively launch and manage private marketplaces in multiple states. In fact, unlike other exchanges, Digital has a year of experience already operating a private exchange. The firm played a crucial role in the development of Vermont Chamber Preferred powered by Liazon Bright Choices — a private benefits exchange launched in October 2012. It’s endorsed by the Vermont Chamber of Commerce, managed by Digital Benefit Advisors and serves nearly 50 employers.

Initially, Digital Benefits Marketplace is rolling out in states where DBA offices exist (such as Virginia, North Carolina and

Florida). The company is negotiating with health insurance carriers in additional locations, as well as providers of ancillary and voluntary products. Offerings include health, life, disability, accident, critical illness, long-term care, dental and vision insurance, along with other products and services. Digital Benefits Marketplace also encompasses an employer segment that most of the industry neglects: both small and middle-market employers.

Advantages to EmployersFixed budget; long-term financial sustainabilityReduced administrative burden Enhanced employee choice and satisfactionNo costly set-up fees or time-consuming implementationExceptional customer service with employee access to live professionalsCompliance with all regulationsDelivered by an established, national employee benefits leader

A Consumer Experience Like No OtherDigital’s focus is on delivering a differentiated consumer

experience that is a harbinger of things to come in the U.S. health care arena. The proprietary marketplace is a true online storefront with a comprehensive range of policies and plans from multiple carriers – and one crucial element that others lack: a call center with highly experienced customer advocates.

Regardless of an organization’s size, Digital’s private exchange solution provides access to knowledgeable customer service representatives to advise and guide individuals and families through the process. And, we have communications tools to educate the workforce. Our resources help a company transition to a system that empowers employees to spend their benefits dollars where they perceive the greatest value. It places them at the center of the decision-making process and allows for greater customization based on needs.This long-term strategy creates more educated, engaged consumers. Combined with cost transparency, this approach can lead to healthier lives and help drive down the cost of

Criteria to Consider When Exploring Private Exchanges

Digital Benefits Marketplace Saves Employers Money and Provides Enhanced Consumer Experience

BY BOB GAYDOS » PRINCIPAL AND NATIONAL DIRECTOR OF PRIVATE MARKETPLACES » DIGITAL BENEFIT ADVISORS

The emergence of private exchanges provides employers with an entirely new approach to employee benefits that will help them control rising costs through defined contributions. In addition, these marketplace solutions foster deeper consumer engagement, setting the stage for the next evolution in the benefits industry. As employees assume greater financial responsibility for health insurance, our nation will move toward a consumer-driven system.


care.

Again, just to summarize, Digital Benefits Marketplace is:A private benefits exchange. – Available on a national basis.– Employer defines its contribution and lets employees

choose their benefits.– Employees can choose from eight health plans, four

dental plans, two vision plans and build their life, disability, critical illness and accident benefits. �

Full service for both employers and employees.– Consolidated benefits administration. We do it all.�– Customer service with decision support. �Simple.– Pre-built benefits stores that allow fast implementation.– Full sales support to help employers define their

contributions.�– Full implementation support to help the employer.�

Comprehensive.– Single employer group contracts. – Ancillary products guaranteed�issue/no�participation limits. – Includes Consult-a-Doc, legal services — and more. �– Targeting employers of all sizes — focusing on fully

insured groups of 50-500 employees.�(Exploring ways to take the employer size segment down to 10 – 15 lives, as well.)

– Availability will vary state-to-state. �

We know from 13 years of experience that complex benefits decisions require support from knowledgeable personnel. Digital has invested in technology to efficiently focus on providing a superior level of service to any size employer. Our view is that we’ve built a capability and cost advantage that will drive our competitive value well into the future. *D\GRV

With the September 18 news that Walgreens was moving over 160,000 lives into the Aon Hewitt Corporate Health Exchange, the shift toward greater consumerism in health care was thrust into the national spotlight.

Walgreen Co.’s adoption of Aon Hewitt’s private exchange is the 18th such adoption by a large U.S. employer. As far public announcements go, Aon is inarguably outpacing the field early on. The 2012 announcements by Sears Holding Co. and Darden Restaurants were unprecedented, and early into 2013’s enrollment period, the trend seems to be holding.

The Walgreens announcement further confirms recent data that suggests that

CEOs, CFOs, HR executives and other benefits decision-makers are looking to make a significant change in their health benefits, one that may include the adoption of a private exchange or defined contribution solution.

Research published earlier this summer by Alegeus Technologies, which polled more than 500 health benefit decision-makers at a cross-section of U.S. employers, suggests that 2015 will see the highest rates of adoption of private exchanges and defined contribution. Alegeus has called 2015 the “tipping point” of employer adoption.

Similarly, data published in August by the National Business Group on Health, a non-profit organization that

represents many large employers’ perspective on health policy issues, echoes this sentiment: many U.S. employers are strongly considering moving into a private exchange, but the majority will do so beyond the 2014 benefits year.

While the Walgreens announcement may provide us a glimpse into the future of health benefits, if industry consensus is confirmed, it is really only the tip of the iceberg.

EDITOR’S PERSPECTIVE

Walgreens Announcement, Recent Surveys Point to Future of Private Exchanges

BY JONATHAN FIELD » MANAGING EDITOR » THE INSTITUTE FOR HEALTHCARE CONSUMERISM


The emergence of private health insurance exchanges represents perhaps the most significant shift in how Americans purchase health benefits in years. And while

many U.S. employers already have moved their employee population into a private exchange or are planning to do so for the 2014 benefits year, the trend will only continue to grow in 2014 and beyond. In fact, recent research published by Alegeus Technologies suggests that 2015 will see the highest rate of adoption of private exchanges among U.S. employers.

According to an Aon Hewitt survey published earlier this year, about 28 percent of employers polled plan to move into a private health care exchange over the next three-to-five years. Yet the number and diversity of private exchanges and defined contribution solutions are still largely unknown to employers, benefit brokers and consumers — enter PrivateHealthCareExchanges.com.

On September 23, to meet the need for a guide to private exchanges and defined contribution solutions, The Institute for HealthCare Consumerism announced the beta launch of PrivateHealthCareExchanges.com, the only online directory aimed at providing employers, health plans, brokers, consultants and consumers with the information to navigate this new market.

Users will be able to search our database of private exchange and defined contribution solutions with important search criteria such as geography, number of insurance carriers, broker accessibility, type of company, distribution partners and more.

We are currently gathering information from solutions providers

in this space to develop the database, and companies can now submit directory listings on a three-tiered system: basic listing (free), enhanced listing ($99 per month) and premium profile ($499 per month). To view the benefits of each option, visit the Search Exchanges page at PrivateHealthCareExchanges.com. Advertising

opportunities are also now open for skyscraper banners and more.

During the beta launch, we would also like to hear constructive comments from the health and benefits industry. If you would like to leave a comment or something for us to consider, visit the Contact page at

PrivateHealthCareExchanges.com. Private exchanges and defined contribution solutions are still relatively new, and many standards are yet to be set. Your input on what information you would like to see us gather from the solution providers will be invaluable in this process. We look forward to your comments.

Additionally, in early October, soon after the Obamacare exchanges open for enrollment to the public, The Institute for HealthCare Consumerism will launch an interactive web tool at PublicHealthCareExchanges.com aimed at connecting employers, brokers, consultants and consumers with the state-based or federal public exchanges.

For advertising opportunities on both new websites, please contact Brent Macy, Managing Director, The Institute for HealthCare Consumerism, at [email protected]. For general or media inquiries, please contact Jonathan Field, Managing Editor, The Institute for HealthCare Consumerism, at [email protected].

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Introducing PrivateHealthCareExchanges.com

New web directory helps employers, brokers and consultants navigate the emerging private exchange

and defined contribution markets


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Navigating Private Exchanges and Vision Benefits

BY TERRI WILSON » SENIOR VICE PRESIDENT AND GENERAL MANAGER OF STRATEGIC PARTNERSHIPS AND INTERNATIONAL DEVELOPMENT » VSP® VISION CARE


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By January 1, 2015, small businesses with 50 or more full-time employees must offer their employees health care insurance that is in compliance with the Affordable Care Act (ACA). To help reduce overhead and simplify the administrative process for the newly required coverage, health insurance exchanges (or marketplaces) were created to allow companies and individuals to shop for health care in one place online.

As companies large and small mobilize to comply with the ACA, they are evaluating whether they should continue business as usual — or UHFRQ¿JXUH�KRZ�WKH\�RIIHU�KHDOWK�EHQH¿WV�WR�WKHLU�HPSOR\HHV��$�JURZLQJ�number of options have emerged to help employers make these decisions in order to meet the health care law’s compliance requirements.

Frankly, there are still many unanswered questions surrounding the largest health care overhaul in the nation’s recent history. As more details emerge, businesses will be searching for the option that is in the best interest of both their employees’ health and the company’s bottom line. $V�WKH\�GR�WKLV��LW¶V�LPSRUWDQW�WR�ORRN�DW�WKH�HQWLUH�EHQH¿W�SLFWXUH�EHIRUH�FKRRVLQJ�D�VSHFL¿F�SDWK�

Private Health Insurance ExchangesIn addition to public exchanges created under the ACA and the

traditional options of purchasing insurance directly from vendors or brokers, private health insurance exchanges are becoming an increasingly appealing option for employers. Private exchanges provide an online marketplace for employees to compare and purchase their health insurance ²�MXVW� OLNH�WKH�SXEOLF�H[FKDQJHV��7KH�GLIIHUHQFH�LV�WKDW�SXEOLF�H[FKDQJHV�are run or administered by state and/or federal government whereas private exchanges are managed by private companies like Mercer, Aon Hewitt and Towers Watson.

Things for Employers to ConsiderExchanges may be a good way to reduce the administrative burden

IRU� EHQH¿W�PDQDJHUV�� KHOS� FUHDWH�PRUH� SUHGLFWDEOH� FRVWV� DQG�PD\� HYHQ�help improve employee satisfaction. With this in mind, it’s important to clearly understand the exchange’s offerings and requirements and make sure they are in line with employee and company needs. With so many SULYDWH� H[FKDQJH� VROXWLRQV� FXUUHQWO\� ÀRRGLQJ� WKH� PDUNHWSODFH�� EHQH¿W�PDQDJHUV�QHHG�WR�GR�WKH�UHVHDUFK�WR�¿QG�RXW�ZKDW�LV�LQFOXGHG�LQ�HDFK�

7RGD\¶V�EHQH¿W�PDQDJHUV�DUH�EHLQJ�FKDOOHQJHG�ZLWK�PDQDJLQJ�ULVN�LQ�PRUH�FUHDWLYH�ZD\V��2QH�RI�WKH�EHVW�ZD\V�D�FRPSDQ\�FDQ�PDQDJH�ULVN��ZKHWKHU�

FKRRVLQJ�FRYHUDJH�LQVLGH�RU�RXWVLGH�RI�DQ�H[FKDQJH��LV�E\�VHOHFWLQJ�D�SODQ�WKDW�RIIHUV�SUHYHQWLRQ�SURJUDPV�DQG�HQJDJHPHQW�VWUDWHJLHV�WKDW�NHHS�PHPEHUV�KHDOWKLHU�

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7RGD\¶V� EHQH¿W�PDQDJHUV� DUH� EHLQJ� FKDOOHQJHG�ZLWK�PDQDJLQJ� ULVN�in more creative ways. One of the best ways a company can manage risk, whether choosing coverage inside or outside of an exchange, is by selecting a plan that offers prevention programs and engagement strategies that keep members healthier and reduce costs.

)RU� H[DPSOH�� SUHYHQWLYH� FDUH� LV� DQ� LPSRUWDQW� SDUW� RI� DQ\� EHQH¿W�offering and should be a core component of your risk management strategy. Preventive care plans, like vision coverage, help keep employees healthier through early detection and treatment of serious health conditions. In fact, SHRSOH�ZLWK�VWDQG�DORQH�YLVLRQ�EHQH¿WV�DUH�WKUHH�WLPHV�PRUH�OLNHO\�WR�JHW�an annual eye exam than a routine physical.1 This preventive strategy leads to lower long-term health care costs and healthier employees. When you’re HYDOXDWLQJ�\RXU�EHQH¿W�GHFLVLRQV��PDNH�VXUH�WR�FRQVLGHU�WKHVH�EHQH¿WV�²whether in the exchanges or through a direct relationship.

�� The complexity of exchanges varies a great degree. Some exchanges offer many choices, which could seem overwhelming for your employees during open enrollment. Look for an exchange that offers strong decision support tools that help employees choose the right coverage based on their needs. :KHQ� \RX� PDQDJH� EHQH¿WV� GLUHFWO\�� \RXU� FRPSDQ\� FKRRVHV�WKH�EHVW� EHQH¿W�SDFNDJH� IRU� \RXU� HQWLUH� HPSOR\HH�EDVH�� ,Q� DQ�exchange environment, employees may need help to make individual choices based on value, network, price and health needs.

�� Another thing to consider is that if your employee has a bad experience in an exchange, you may have limited options to help the employee. Most exchanges manage all of the vendor relationships on a large scale, so you may no longer have the personal touch points you may have today.

�� &RPSDQLHV�PD\�DOVR�¿QG�WKH\�QHHG�WR�UHOLQTXLVK�FRQWURO�LQ�DQ�exchange environment. When working directly with a carrier, FRPSDQLHV� FDQ� DVN� WKHLU� YHQGRUV� WR� WDLORU� D� SURJUDP� WR� ¿W�WKHLU� VSHFL¿F� QHHGV�� DQG�PRVW� YHQGRUV� ZLOO� GR� VR� LQ� RQH� ZD\�or another to best meet a client’s needs. Employers may not have that same customization ability from an exchange since standardization is a key component of the exchanges.

�� The structure of exchanges also varies, making it crucial to examine their requirements and offerings closely. One exchange may require you to offer all products on their platform, while others may allow you to choose whether or not to include the DQFLOODU\� SURGXFWV�� %HQH¿W�PDQDJHUV� DQG� EURNHUV� VKRXOG� WDNH�note of these requirements, particularly if a company has a strong relationship with a voluntary plan that it wants to keep.

Common Misconceptions �� Many companies view the insurance exchanges as a way

WR� GRZQVL]H� EHQH¿WV� RU� DV� VRPHWKLQJ� WKDW� RQO\� VWUXJJOLQJ�businesses would use. The format is certainly different from today’s health care model, but the quality of your company’s EHQH¿WV� GRHV� QRW� KDYH� WR� VXIIHU�� ,W� LV� VLPSO\� D� PDWWHU� RI�choosing what is right for your business’ needs—whether that is a particular exchange or continuing to work directly with your vendors.

�� Another common mistake is viewing an exchange as synonymous ZLWK�D�GH¿QHG�FRQWULEXWLRQ�SODQ��$�GH¿QHG�FRQWULEXWLRQ�SODQ�LV�a way a company can limit its risk by providing employees a

¿[HG� ³DOORZDQFH´� IRU� KHDOWK� FDUH�� :KLOH� WKLV� DSSURDFK� LV� DQ�option with exchanges, it’s not a requirement.

�� A third misconception is that vendors will struggle with channel FRQÀLFW� ZKHQ� VHOOLQJ� LQ� WKH� H[FKDQJHV�� HVVHQWLDOO\� FRPSHWLQJ�against their direct business. Although it is another distribution channel, it’s more about increasing the number of ways a EHQH¿WV�PDQDJHU�FDQ�DFFHVV�EHQH¿WV��

For example, at VSP Vision Care, we want our clients to choose how WKH\�ZDQW� WR� SXUFKDVH� WKHLU� EHQH¿WV��:H� WKHQ�ZRUN� RQ� WKH� EDFN� HQG�²�ZKHWKHU�LW�EH�WKURXJK�DQ�H[FKDQJH��TXDOL¿HG�KHDOWK�SODQ�SDUWQHU��VWUDWHJLF�alliance or directly with the client — to ensure their employees have a great experience with VSP as their vision coverage, regardless of how they get it.

The Bottom Line6PDOO�FRPSDQLHV�RIIHULQJ�LQVXUDQFH�IRU�WKH�¿UVW�WLPH�PD\�EH�XQGHU�

PRUH� SUHVVXUH� WR� TXLFNO\� GHYHORS� D� TXDOL¿HG� EHQH¿W� SDFNDJH� ZKHUHDV�larger companies can spend more time evaluating options. Regardless of company size or whether or not you choose to use the exchanges, \RX� VKRXOG� FKDOOHQJH� \RXU� EHQH¿WV� DGPLQLVWUDWRUV� WR� GHPRQVWUDWH� WKH�LPSDFW�RQ�\RXU�ERWWRP�OLQH��3URYLGLQJ�D�YLVLRQ�EHQH¿W�LV�RQH�RI�WKH�PRVW�cost-effective ways to help manage the health of your employees, so you VKRXOG�PDNH�VXUH�WR�LQFOXGH�RQH�DV�\RX¶UH�HYDOXDWLQJ�\RXU�EHQH¿W�SDFNDJH�options. $V� 6HQLRU� 9LFH� 3UHVLGHQW� DQG� *HQHUDO� 0DQDJHU� RI� 6WUDWHJLF�3DUWQHUVKLSV� DQG� ,QWHUQDWLRQDO� 'HYHORSPHQW�� 7HUUL� :LOVRQ� LV�UHVSRQVLEOH� IRU� DOO� EXVLQHVV� GHYHORSPHQW� DFWLYLWLHV� IRU� WKLUG�SDUW\�GLVWULEXWLRQ�FKDQQHOV�� LQFOXGLQJ�SULYDWH�H[FKDQJHV��IRU�963�9LVLRQ�&DUH�� WKH� ODUJHVW�QRW�IRU�SURILW� YLVLRQ�EHQHILWV� DQG� VHUYLFH�FRPSDQ\�LQ�WKH�8�6��)RU�PRUH�LQIRUPDWLRQ��YLVLW�ZZZ�YVS�FRP��

____________________________________________________________

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KHDOWK�FRQGLWLRQV��,Q�IDFW��SHRSOH�ZLWK�VWDQG�DORQH�YLVLRQ�EHQHILWV�DUH�WKUHH�WLPHV�PRUH�OLNHO\�WR�JHW�DQ�DQQXDO�H\H�

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http://www.vsp.com/


EXCHANGE SOLUTIONS SHOWCASE

HSA/HRA/FSA TECHNOLOGY: ADMINISTRATION & MANAGEMENT

TSYS Healthcare® provides end-to-end strategic payment solutions for consumer directed healthcare. We partner with benefits administrators, financial institutions, health plans, and software providers to navigate all aspects of HSAs, HRAs, FSAs, transportation accounts, cash reimbursements, and lines of credit. TSYS Healthcare cards offer participants the security they expect along with the ability to conveniently access funds from multiple accounts and manage their benefits payments with simplified single-card access. Clients and partners benefit from simplified processes, reduced paperwork and cost savings that can contribute to improved return on investment.

“We built the TSYS Healthcare platform to meet the market demand for reliable, configurable and intelligent solutions. Understanding the dynamic U.S. healthcare market, our customers rely on our option-driven system to prepare them for the future.”

! Trey Jinks, Group Executive, TSYS Healthcare

TSYS HEALTHCARE706.649.5080www.tsys.com/[email protected]

Evolution1 and our Partners serve more than 9 million consumers, making us the nation’s largest electronic payment, on-premise and cloud computing healthcare solution that administers reimbursement accounts, including HSAs, HRAs, FSAs, VEBAs, Wellness and Transit Plans. It is the only solution that offers a single end-to-end user experience, provides innovative auto-substantiation technologies, and automates workflow for Partners, employers, and consumers. It does all this on one technology platform comprised of 1Cloud™, 1Direct™, 1Pay™, 1View™, 1Plan™, and 1Mobile™. Evolution1 and our Partners are dedicated to delivering value, reducing costs and simplifying the business of healthcare.

“The combination of our innovative products will further our leadership position in a rapidly changing healthcare market. Together with our Partners we are committed to reducing costs and simplifying the business of healthcare.”

— Jeff Young Chairman and CEO, Evolution1

HSA / HRA / FSA ADMINISTRATION AND FINANCE

EVOLUTION1, [email protected]

WageWorks helps employers

support consumer directed

pre-tax benefit programs,

including health care

(FSA, HSA, HRA), wellness

programs, commuting and

child and elder care. Wage

Works also offers retiree health care and COBRA Services.

More than 100 of America’s Fortune 500 employers and

millions of their employees use WageWorks.

HSA / HRA / FSA ADMINISTRATION AND FINANCE

WAGEWORKS1100 Park Place, 4th Floor San Mateo, California 94403United States of America

888-9905099www.wageworks.com

BENEFIT ADMINISTRATION/PRIVATE EXCHANGES

Since 1988, CieloStar (formerly OutsourceOne) has helped brokers, employers and employees navigate the ever-changing world of benefits. Now, with the dawn of “Defined Contribution Health Care” we are again on the leading edge. With a team of industry thought leaders, CieloStar makes navigating healthand benefits choices easy for employers and employees by offering comprehensive benefits administration solutions with a high-touch, high technology model—most recently launching a proprietary private health insurance exchange.

“Fueled by the far-reaching impact and complexities of health care reform taking effect in 2013 and 2014, employers and employees increasingly find themselves in a ‘farmer’s market’ of benefits choices. Cielostar is uniquely positioned with enabling technology that helps purchasers and consumers make the best possible decisions and create a best-in-class benefits administration process. Our unique comprehensive approach to benefits offers everything from back room technology for enrollment, data, billing and call centers to complete solutions for COBRA, CDHP and health insurance exchanges.”

! John Reynolds, CEO, Cielostar

CIELOSTAR530 U.S. Trust Building730 Second Avenue SouthMinneapolis, MN 55402

612.436.2706 [email protected]

$FFHVV�WKHVH�SUR¿OHV�RQOLQH�DW�ZZZ�7KH,+&&�FRP�

©2013 Truven Health Analytics Inc. All rights reserved.

ENGAGE AT EVERY STAGE

TRUSTED. PROVEN.

Ninety million consumers report having a hard time understanding their care choices, according to an Institute of Medicine study.* And as the healthcare landscape changes and insurance exchanges become available, consumers are likely to be more confused than ever.

Though it remains to be seen what shape the new marketplace will take, it’s clear that consumers will require a range of tools to support their healthcare decision-making. From guiding individuals to their best-fit benefit plan to alerting them about gaps in care, Consumer Advantage from Truven Health Analytics™ provides a full array of solutions to engage consumers with personal, relevant, impactful information throughout the year.

Consumer Engagement: The Key to a Successful ExchangeBacked by more than 30 years of experience, our consumer experts, integrated platforms, and data management solutions have helped turn passive participants into active healthcare consumers. Recent successes include:

� Increasing adherence to colorectal cancer screenings by 22 percent

� Migrating 59 percent of employees from a PPO to a CDHP

� Reducing the number of “overinsured” employees by 14 percent

� Enrolling more than 1,000 new participants in a health savings account

Find the path to a healthier bottom line — visit booth #135 at AHIP Institute 2013 or go to truvenhealth.com/exchange

Consumer

confusion about

their care choices is

directly responsible

for 3- to 6-percent

higher healthcare

expenditures.*

* Source: Institute of Medicine Report Brief

HealthCare Exchange Solutions

Documents

Transcript of HealthCare Exchange Solutions