HighRoads said private exchanges tend to raise the following issues for employers:

Plan participant communications. Private exchanges add a new layer of complexity for employees and retirees, in terms of benefit offerings and the selection process, while a shift to an exchange model will raise questions and concerns among affected participants. Communications need to be crystal-clear and employees must be able to artuculate basic elements of the plan before roll-out.
Who owns compliance? Employers need clarity around who owns the various documents required by Employee Retirement Income Security Act and the Affordable Care Act, including the Summary Plan Description and the Summary of Benefits and Coverage.
Monitoring private exchange vendor performance. Employers will need to be fully educated on the defined contribution approach and have both an efficient RFP process for private exchange vendors and a robust supplier management system to monitor vendor performance.
Data consistency from employer to private exchange to payer and back. All players in the benefits management data lifecycle – employers, private exchange vendors and payers alike – will need solutions to ensure consistent plan data, including cost-sharing information.

Offering a longer-term forecast, a survey released earlier this month by Aon Plc, the London-based insurance broker, found that while 95 percent of employers said they would continue to offer health care in the next three to five years, 33 percent may use a private exchange to provide the benefit up from 5 percent currently.

Instant Insights /

Employers weigh private exchanges, self-insurance

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