L&T Blog

Employers turn to private exchanges to control healthcare costs and give employees more options

July 2, 2019

Navigating the complex healthcare benefits environment can be a confusing and expensive proposition for employers across industries. While mainstream packages are typically built with a one-size-fits-most philosophy, the majority of workforces have diverse and often divergent needs.

From the 20-something singleton to the employee with a family of four or the empty nester couple with increasing specialized needs, a workforce’s needs run the gamut and often drive up the costs that companies are paying to ensure adequate coverage. Add to this skyrocketing cost combined with a hot job market, and many businesses are left with top talent jumping ship to competitors with more robust coverage options.

Private exchanges reduce costs, increase options

While some employers are more comfortable with large scale health insurance offerings, they sacrifice quality and choice. These plans seemingly offer the most services to the greatest number of people on paper, but their rigidity, often high deductibles and incompatibility with real-life employee needs.

The answer lies in private exchanges. There’s a misnomer in the industry that all private exchanges are alike, but nothing can be further from the truth. The goal of a private exchange is to give employees more ownership over their healthcare offerings and decisions, while providing employers with a less expensive health insurance offering.

At Lovitt & Touché, a private exchange is an online marketplace where employees shop for benefits that fit their needs with decision-support software, using money given to them by their employer through a defined contribution model.

Employers take back control of healthcare dollars, administrative time

While easy to renew, the status quo may not be the best available choice.

A private exchange such as ClearPath Prime allows not only flexibility, but increased cost savings and better stewardship of healthcare dollars. Consider these benefits.

·        Cost predictability: Unlike other private exchanges, ClearPath Prime has been intentionally structured to provide employers reduced costs with increased options. Working similar to a company gift card, employees can spend their healthcare dollars to design a benefits package tailor-made for their specific needs.

Instead of a one-size-fits-all, employees will be able to choose from a wide assortment of benefits options, including a variety of health plans ranging from traditional co-pay plans, to low-premium/high deductible plans that qualify for an HSA.

·        Increased employee engagement and satisfaction: Most employees have set up their own investment and retirement portfolios to best meet their needs, shouldn't they have the same flexibility when it comes to their health insurance? Given the choice, along with the right tools to help them decide, employees will pick the best plan for themselves and their families. It may not be the most expensive or the least expensive, but it will be the one plan that fits each employee's situation the best. And in turn, they become better consumers of healthcare.

·        Administrative ease: Large insurance plans may boast about effortlessness, but at what cost? A comprehensive private exchange will provide the employer with administrative efficiencies. Usually this is accomplished through a web-based portal that would handle employee enrollments, payroll feeds, carrier connectivity and manage billing reconciliation. Employees’ healthcare choices are tracked and managed online and become a self-service tool that manages information and documentation.

Creating a return on healthcare investment

Lower costs. Better healthcare consumption. Happier employees.

It may seem impossible to achieve, but a private exchange can be the answer and deliver a critical return on healthcare investment to employers. For many Arizona-based companies, ClearPath Prime has become their customized blueprint to achieve proactive cost control, increased productivity and positive results for their business and employees.

Learn more about ClearPath Prime and exactly how it can contribute to the health of your business and your employees.