Technology will play a huge part in the success of private health care exchanges, as consumers are used to choice while shopping on the Internet, a top executive at Aon Hewitt said. Speaking in July at the Private Healthcare Exchanges conference, sponsored by EBA's parent company SourceMedia in Chicago, John Moses said working on the consultancy's exchange has been one of the most exciting things he has ever been involved with.
According to Accenture, 83% of American consumers are unfamiliar with private exchanges. Yet by 2018 their total enrollment will surpass state and federally funded public exchanges. Therefore, the key to making the private exchanges work is helping employees - who now need to be seen as consumers, Moses said - successfully navigate through them.
Aon's exchange, the Corporate Health Exchange, enrolled more than 100,000 employees during the 2013 annual enrollment last fall. This included employees of Sears Holdings Inc. and Darden Restaurants, according to the company.
Its exchange is similar to online travel wholesalers, Moses, who leads Aon's communication health engagement efforts, explained. "Technology allows people to evaluate [items] in a marketplace in a way they are starting to become accustomed to, like Amazon [and]Travelocity," he said. Similar to looking for travel deals online, "people are used to going in and saying, 'I want this product. What's the best pricing, the best timing, what's going to work best for me?'
"It is very similar for [the Corporate Health Exchange]. Exchanges bring the buyer and seller together," he added. "We are doing this in the health marketplace much like other [online] businesses."
Just as online travel marketplaces research how best to sell to consumers, a private exchange must do that too, Moses said. Aon did consumer research after the first round of enrollments to see what consumers were most focused on. Those areas included:
* Competition: The fact that you get to select the carrier you'd like to provide your insurance, which is fairly different from the past. That idea excited people, he said.
* Choice: Consumers looked for doctors and providers they preferred, as some networks may have them as in-network providers, and some may not.
* Control: Employers provide a subsidiary, but will a consumer use all of it, supplement it or something else?
* Flexibility: Tailoring a plan to best meet their family's needs.
More than two-thirds of Aon's exchange users changed their health plan during 2013 open enrollment, the company said. According to Moses, 42% of employees bought less expensive coverage than they had before - most from a PPO to an HDHP - while 26% bought richer coverage. "People evaluated their options. Some people stuck and some changed," Moses said. "It's a good indication that people are paying attention and view this as a marketplace."
With the exchanges being online, Moses agreed that could present a challenge for some employers as they move from paper, particularly those whose employees are not at a computer for work. But even those employees, he said, are increasingly gaining access as Aon works on steps to make it easier to enroll.
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