Health Care and Private Exchanges
Some smaller and medium sized companies have historically been unable to offer group health care coverage due to the high costs associated with purchasing these plans and the limited options available to them. Companies who have a high turnover of staff or who are unable to afford the costs associated with administrating benefits, may have also found it difficult to offer benefits to their employees. The Health Care Reform and Affordable Care Act are helping to increase access to health care such as through the use of public exchanges. Alternatively, companies may prefer to utilize private exchanges, market places which specialize in providing a wide variety of health care options.
Private exchanges, allow companies to work with a single carrier or several carriers, and are beneficial as they allow companies to choose from a wide variety of plans. Employers choose a carrier to work with, providing them with specific criteria such as how much money they wish to spend or the type of plan they wish to offer their employees. The carrier then provides the company with several coverage options which the company selects from. Employers are then able to provide several options which their staff will ultimately select from, choosing a benefit plan which will meet their individual needs and those of their family. The company pays the employees premiums directly to the carrier. Private benefit exchanges have become more efficient due to new technology which helps to streamline the process. For example, companies are now able to compare insurance plans side by side, helping them to have a greater understanding of their options.
However, similar software must also be made accessible to employees to enhance their decision making. Currently employees have access to enrollment interfaces in which the application to begin the enrollment process can be carried out online. Once purchased, employees will also be able to access details of their benefits. They will be able to receive updates, use self-service options which will allow them to update their personal details, monitor their own health care costs, access billing, invoices, and access the carrier’s customer service. This helps to reduce the administrative tasks carried out by the companies own HR department.
Companies must therefore ensure that there are not only able to provide their employees with optimum healthcare options, but that they are also able to efficiently administrate their benefits within their company. Some employers are choosing to work with HR consulting firms, to help guide them in choosing the best software solutions. In many cases, benefits administration can be effectively integrated with other HR processes including payroll, and companies may also choose to use options such as cloud computing. Cloud computing are useful solutions for companies with multiple departments across several locations, allowing data to be shared and providing access to benefit information in real time. When choosing to utilize private exchanges, companies must therefore also consider the long term administration of their new benefit plans.