Private Exchanges to Employer Health Benefits
There has been a lot of attention around the Affordable Care Act and the state exchanges for healthcare in the past year. Another player that is starting to earn some spotlight as a way to provide employer- based health benefits are private exchanges. These private options are gaining traction as big players such as IBM, Walgreens and Sears all turn to them for employee benefits.
…private options are gaining traction as big players such as IBM, Walgreens, and Sears all turn to them for employee benefits.
Employers with 50 or more full-time employees are now required to provide health insurance or are at risk of additional taxes. Since healthcare costs have skyrocketed in recent years supplying employees with more traditional employer- sponsored plans is not always feasible. This has led to a preferred increase in private healthcare plans for employers.
But why would an employer choose to go with a private exchange? There is a lot of administrative work that is involved when providing public healthcare plans for your employees. The time and effort it takes to complete all the necessary paperwork is not always something many small business owners have the time or energy to deal with. When you sign up with a private exchange the employer pays a fee and then presents different plans and options for their employees to choose from. At the end, the employer is then given one simplified bill from the exchange which takes a lot of the complexity out of providing healthcare.
Another reason some businesses turn towards private exchanges is because they are ultimately making a contribution towards their employee’s healthcare. Employers are responsible for contributing to employee’s premiums which then gives their employees the opportunity and freedom to select the plan that works best for them and their family.
Making decisions about the type of healthcare you will provide your employees can be tricky. It’s important that you figure out what will work best for your business and your employees. Take the time to speak with advisers from both public and private exchanges and become as informed as possible. Both will come with their fair share of pros and cons but we all know how important healthcare coverage is, so it’s best to make the most educated decision possible.