The number of people who enrolled in private health insurance exchanges—an online marketplace for people to choose their employer-sponsored benefits—for 2016 increased 35 percent from last year, to approximately 8 million, up from 6 million in 2015.
This was one of the findings in a report by professional services specialist Accenture, which conducted an analysis of U.S. enrollment in private health insurance exchanges, focusing on individuals and dependents under the age of 65.
The company’s research indicates that the growth of private health insurance exchanges continues to be fueled by midsize companies with 100 to 2,500 employees.
“There are many benefits to private health insurance exchanges. For one, historically, employers have offered defined benefits to employees,” Scott Brown, managing director of Accenture’s private health insurance exchange offerings, told eWEEK. “As the model shifts to more companies offering defined contribution models, private HIX [health insurance exchanges] are consumer-friendly platforms that enable employees to purchase health insurance products that best fit their needs.”
Brown explained that while private HIX can operate with or without defined contributions, they offer the technology and digital experience that traditional plans have yet to match—satisfying employees’ high expectations that are based on retail experiences.
He also noted that the advent of the private health exchange model has sparked innovation across the enrollment process—in a retail-like experience, decision-support tools are helping individuals evaluate their benefit options and carriers during open enrollment.
“Even more important, as actuarial choice increases, these tools can help employees find optimal coverage and decide where their dollars should go,” he said. “Examples include cost estimators, doctor selection tools, choice engines and plan comparisons. As more and more users directly encounter the trade-offs between price and benefit levels, we expect technology to play an even greater role in supporting consumers’ decisions.”
The rate of adoption among large employers did grow slightly in 2015, but many have been on the fence in deciding whether to adopt private health insurance exchanges.
The report also noted that creating a compelling digital experience that’s distinct from those offered by existing benefits providers will be a boon for current exchange providers.
This goes beyond simply providing an array of digital tools. Instead, exchanges must align those tools to business objectives for plan sponsors using the exchange, the report said.
“Reducing the administrative burden on human resources staff will play a key role in the evolution of private exchanges,” Brown said. “Private exchanges will need to demonstrate how digital platforms go beyond the basics in terms of turnkey solutions for reporting, automation of tasks, simple online solutions for complex services, and a reduced need for paper enrollment. Mobile enrollment and advanced digital tools and call centers will hopefully streamline employees’ decisions while eliminating costly processes.”