And more importantly, why are so many employers getting on board with it as a way of providing healthcare to their employees?
Here’s the first answer: Private exchanges are a natural extension of the new healthcare economy, which includes the online healthcare marketplace. Much like the federal government’s Healthcare.gov service has public healthcare exchanges in most states (and residents of those states can apply to pay for coverage under those exchanges), corporations can have private exchanges of healthcare plans that are available to employers. So, think of a private exchange as a privately owned version of the government’s healthcare model.
As an employer, you can participate in employee healthcare plans under these exchanges. A private exchange works alongside a variety of third party insurance companies to provide healthcare services. Another way to think of it is as a contractor/sub-contractor relationship. An umbrella organization that operates a private exchange acts as a contractor, and the private exchange is akin to a sub-contractor.
Perhaps you have heard that some large consulting firms are acting as umbrella organizations that offer private health insurance exchanges. This is true, and it’s also true that GM&A is doing the same thing via our direct contracting model. We have created private exchanges for many employers so that everyone – employers and employees – can reduce their out-of-pocket costs. By partnering with the insurance companies that participate in our private exchange, we act as an appointed producer of your company’s healthcare plan and it benefits everyone: you, the employer; the provider, who administers the care; and the end users, which are your employees.
We can help your company provide coverage for full time and part time employees, in addition to existing retirees of your company if applicable. If you need a cost-effective healthcare solution for your company, it’s hard to beat the cost savings, personalization and flexibility of the private exchange model. To learn more, feel free to contact us for a complimentary health plan consultation.