Benefit Exchanges - An Overview
As part of the Health Care Reform, changes are being seen in both the types of health care coverage that companies must now offer employees, and ways in which these can be purchased. Some companies may find that their current plans no longer meet new health care regulations, whilst others may find that they have the ability to offer health care coverage for the first time. Companies may now choose to purchase health care coverage through new health care benefit exchanges. These public exchanges are market places for consumers, which reduce the costs of health care coverage due to the larger pool of consumers participating in the exchanges. Sharing the risk between multiple consumers reduces the cost of premiums for all involved. Widening the pool of those participating in the exchange is particularly beneficial for smaller companies, as it allows them to enjoy a similar purchasing power to those of larger companies. The benefit exchanges also increase the number of coverage options that are available to companies and individuals.
The Affordable Care Act or ACA will require that all states participate in these benefit exchanges. There are several ways in which benefit exchange programs can be set up. The federal government may set up and run these programs on behalf of each state. Alternatively, states may choose to create their own exchange programs and administrate these. Another option, is for both the state and the federal government to work together to create exchange programs.
Companies will need to be aware of which route their specific state has chosen to take and which options will be made available to them. This is important, as it will greatly impact the coverage they offer their employees, including how these will be administrated. As the health care reform will also affect companies in different ways, based on their size, they should also be aware of how the health care reform will specifically impact them. Now more than ever, companies need to ensure that their benefit administration is efficient, streamlined and allows for analytic and metrics to be applied to data. The software applications used to administrate benefits are important to ensure that data management is accurate and that departments are able to communicate with each other, particularly to update processes in accordance with changes to state and federal legislations.
There are a variety of integrated software solutions available, including those which use cloud computing and which help to integrate benefit administration with multiple tasks and processes. This allows for an effective flow of communication in real time and ensures that companies remain compliant during this period of change. Integrity of data and processes is particularly important to ensure that data is reliable and secure, particularly when it comes to sensitive employee data which may be recorded as part of benefit administration.