Most private exchanges are geared toward an employer's workers, who usually receive a fixed amount of money from the employer to buy available plans on the exchange. But Sam's Club's exchange is different, because it will target a specific subset of its customers. Small-business owners in 18 states will be able to access the company's marketplace.
Consulting firm Accenture said this past summer that about 3 million people received employer-sponsored health insurance through a private exchange, and that number could increase by 13 times within the next four years.
“We certainly have seen growth this fall over last fall,” said Rich Birhanzel, a managing director within Accenture's healthcare group. “The reasons continue to be around employer affordability, and at the same time, expectations from employees having a retail-like experience when shopping for health benefits.”
Private exchanges are similar to the public ones created by the Patient Protection and Affordable Care Act, except people cannot receive premium subsidies to buy plans on private exchanges. Private exchanges also vary by setup—some exchanges offer multiple health plans from multiple insurers, while others, like the one created by Sam's Club and Aetna, only offer options from one insurer.
“Smaller employers will gravitate toward the single-carrier exchanges,” said Paul Fronstin, senior researcher at the Employee Benefit Research Institute. Large employers will more likely reach out to benefit management firms like Aon Hewitt and Towers Watson for multicarrier exchanges to give employees more options.
Despite the recent attention given to employer-sponsored health exchanges, like those implemented at Costco and Walgreen Co., private exchanges are not a new concept, Fronstin said. The federal government, the nation's largest employer, has run the Federal Employees Health Benefits Program for more than 50 years.
The more recent change, however, is that employers of all shapes and sizes are viewing private exchanges as a way to cut down on escalating healthcare costs.
“There's a tremendous amount of interest in it,” Fronstin said. “There's definitely some action going on there, but like most major trends in benefits, they don't happen overnight.”
“It is important when these larger employers start to make these choices and move, because our view is there is a seminal effect,” added Birhanzel, who said a vast majority of the employers Accenture talks to are considering private exchanges at some point in the future.
Follow Bob Herman on Twitter: @MHbherman
