Private Exchanges cost more money than traditional group insurance. But, they can still be the right answer for groups looking to expand and simplify at the same time.
“Typically, private exchanges are set up by a consulting company or an insurance carrier and offer a broad range of health plans. Employers contribute a set amount that may cover most or all of the cost of a basic plan. It’s up to the worker or retiree to pay for a higher level of coverage.”
The biggest concern for employers is the change in who delivers these complicated new products. For many employers who have National Consulting firms providing information to employers, like those mentioned in this article, it’s self-serving on the part of those organization to also be the pedalers of their own product.
In this article, Towers and Mercer, two of the largest consulting firms are also the creators and sellers of their own private exchanges. It’s a bad idea for the pedalar of the product to also be the advisor. While most anyone would say that’s obvious, it is important to remind individuals responsible for company purchases to get an independent third party to confirm a decision, or help in the evaluation process.
BenStaff is in the business of providing valuation advice to large and small employers. A second opinion will help many employers or unions from making a poor decision.