Over the past decade, there's been a consistent rise in thepopularity and importance of consumer-oriented, cost-consciousemployee health plans.

A similar emphasis is now being placed on open-marketsolutions—namely, both public and private insurance exchanges.Employee benefit offerings are more important than ever, and plansare becoming increasingly competitive. By creating anemployee-centric benefits marketplace, employers can offer a moredesirable compensation package and maintain a solid retentionrate.

Employers may turn to their brokers for guidance in developing abenefit strategy in a private exchange. But how can brokers betterserve their clients in the marketplace environment?

Rise of consumerism 

Rising health care costs are a key driver of the demand forreform. Private exchanges with defined contribution support arebecoming popular in controlling these costs by capping the amountemployers spend. The defined contribution model gives employees aset dollar amount, allowing them to shop from a variety of benefitofferings selected by their employer.

This method is a true reflection of how consumerism is appliedto employee benefit programs. Employees, as consumers, are morelikely to spend their money more wisely when presented with morechoices. By providing clients with guidance in creatingcomprehensive benefit programs through private exchange, they'll beable to offer employees the best coverage at an affordable priceand save more money in the long run.

Broker role redefined

Private exchanges are expected to thrive no matter what happenswith health care reform.

There is questioning whether or not the role of the broker willdisappear in the new consumer-driven marketplace. However, it'sbecoming clear that brokers can still be a major part of thebenefit management process. With more choice, employers and theiremployees will need more direction, allowing brokers to take onmore of a consultative role. Health care plans aren't simplepurchases and one plan doesn't fit all.

Though many of the private  exchanges have developedsophisticated decision support tools that encourage self-service,the role of the broker is not eliminated but redefined as amarketplace navigator. As a navigator, brokers will provide expertcounsel to employers in purchasing plans. Employers will need thatsame expertise in developing a strategy to communicate benefitplans to their employees.

Not to mention, brokers can serve as consumer advocatesthroughout the benefits lifecycle, especially concerning issuesthat arise in billing or claims.

Broker-sponsored private exchange

By sponsoring a private exchange, brokers will be able to offera whole new set of benefit options and services for employerclients with the scalability to support all size groups. With thisflexibility, wellness and educational programs that were designedfor large employers are now accessible to smaller groups. Privateexchanges can be profitable for brokers while also offering theopportunity to expand their product offerings and services.

The emphasis on employee choice and decision-making does noteliminate the need for your client to enforce eligibility rules,manage life events and administer benefit programs after the planselection process is complete.

By leveraging the latest in cutting-edge benefits technology,brokers can provide their clients access to a private exchange on acloud-based platform designed to manage the benefit complexitiesassociated with both insurance carriers and employers of all sizes.With a broker-sponsored private exchange, strategic alliances withinsurance carriers are facilitated which is crucial when securingthe best plans for your clients.

A private exchange

The best private exchanges are not built from the ground up, butrather are built with trusted, proven technology that can alreadyhandle the intricacies and transaction volumes associated withbenefits management. This includes filtering plans by configurableprequalification data, verifying eligibility for public programs,premium tax credits, or subsidies, enforcing business rules at alllevels and integrating online billing to view, pay and manageinvoices online.

Powerful decision support tools are key in the exchangemarketplace to provide an intuitive, personalized shoppingexperience. A successful private exchange enables employers todevelop a communication strategy that will empower their employeesto make more informed decisions using integrated cost estimatorsand plan comparison tools that personalize benefit selection andexplain the relationship between their healthcare usage and benefitcosts.

These tools help consumers project estimated costs for differentplans, viewing in real-time the benefits that best fit their needsand their budget.

With the right technology platform, exchanges can provide yourclients with resources such as videos, interactive symptom checkersand apps that help their employees become educated, cost-conscioushealthcare consumers throughout the year. For example, videos canexplain the benefits of regular checkups and preventive care visitsthat are often covered at 100 percent by health plans. Making thesetypes of educated decisions are small but important steps towardcontrolling the industry-wide issue of rising health carecosts.

Convenience of marketplaces

Private exchange marketplaces offer employers and theiremployees the opportunity to shop, enroll, and manage all theirbenefits in one place.

Cloud-based technology and mobile capabilities makes enrollingin benefits more convenient than ever which leads to increasedparticipation rates. Employees have access to explore all availableplans their employer has chosen to offer at any time through aportal that offers one cohesive, engaging workflow.

Private exchange technology allows employers to automate theenrollment process with integrated payroll deduction and billingoptions, saving them time and money. Exchange marketplaces arechanging the benefits landscape. In order to stay ahead of thecurve, consider sponsoring a private exchange for your clients'benefits management strategy. 

Shandon Fowler is the director of product management,marketplaces for Benefitfocus (www.benefitfocus.com).