Carriers are getting ready to tout their voluntary products to consumers who shop on new, private exchanges.
According to Eastbridge Consulting Group, a whopping 90 percent of carriers say they’re planning on offering their voluntary products through a private exchange.
Eastbridge reported this week that those carriers are either still developing their strategy or planning to work with carriers, brokers/consultants, or technology vendors to craft their solution.
Carriers that already have a strategy in place were evenly split among using a single-company or multiple-company private exchange approach, or a combination of both types, Eastbridge's report found.
Consumers shopping for products on a private exchange may most likely see voluntary life, critical illness, accident and short-term disability on the menu of options. Those are the voluntary products most frequently mentioned by carriers, Eastbridge reported.
Those products typically are among the most popular voluntary products offered through the workplace, according to Towers Watson.
Eastbridge said carriers believe that “voluntary products offered on an exchange will be more standardized and pre-packaged in terms of the benefits offered.” Carriers also said that pricing, underwriting, and commissions may be adjusted, depending on the exchange model.
Private exchanges work similarly to the public exchanges set up by the Patient Protection and Affordable Care Act in that consumers will be able to compare and choose their own health plan. For the most part, employers give workers a set amount of money to spend on health insurance and other ancillary benefits in a private exchange.
Private exchanges are booming in popularity, being developed by consulting firms such as Aon Hewitt, Mercer and Towers Watson.
A recent study from Accenture predicted that although enrollment in private exchanges will start “slowly” — with one estimated million enrollees in 2014 — and trail public exchanges for several years, private exchanges enrollment will catch up by 2017 and even exceed public exchange enrollment by 10 million members in 2018.