An Introduction to Public Benefit Exchanges
Both public and private health benefit exchanges provide marketplaces which offer a variety of health care coverage options to individuals and employers. They make recommendations to consumers based on their specific needs and provide a variety of recommended plans to choose from. After purchasing, they also continue to provide ongoing customer service support and offer administrative support, such as easy online and automated billing. However, there are also some differences between public and private exchanges which businesses should be aware of.
Private exchanges are managed by private companies or brokers, whereas public exchanges are run by a government entity. They may be state based, in which the state sets up and runs the exchanges, state partnership exchanges, in which the state runs certain aspects of the exchange with the federal governments managing others. Alternatively, states may choose to use federally facilitated exchanges in which the federal government sets up and manages many aspects of the public benefit exchanges.
Under the Patient Protection and Affordable Care Act, each state will be required to have two types of public exchanges set up ready for 2014. These include an American Health Benefit Exchange, also known as an individual exchange, and a small business health options program (SHOP). These exchanges will be required to offer plans which are ‘qualified health plans’ (QHPs) and which meet specific requirements, adhering to new health care reform regulations. Plans will be required to cover essential health benefits, such as hospitalizations, emergency services, maternity care, mental health services, prescription drugs, preventative, and wellness services amongst other requirements. Individuals who are unable to afford health care coverage may be eligible for subsidies or premium credits, to help pay towards health care coverage.
The public benefit exchanges will also offer a variety of additional advantages, such as providing an online portal or website, in which consumers can access plan information, including the cost of plans, quality ratings, in ways which are easy to follow. Their websites will also include online calculators, helping consumers to engage in more informed decision making, estimating the cost of covering their employees, whilst taking into consideration other contributions, such as employee’s tax credits. Customer service operators will also be available to help companies choose plans, and to help advise companies on any tax credits or other sources of support that may be available to them. They will also help to provide support regarding any disputes with carriers, and allow for consumers to provide feedback regarding their coverage.
As the health care reform will bring many changes with it, employers must also be aware of how it will affect their company, including their responsibilities as employers. Many subsidies or tax credits offered to both individuals and small businesses will only be available through public exchanges and should be an important consideration when choosing which exchange to work with. These changes may result in companies choosing to rethink their current health care coverage and choose to work with these new public exchanges.