Private exchanges are no longer sizzling hot, but some employers are still interested in hearing more about them.
The International Foundation of Employee Benefit Plans (FEBP) and Pacific Resources Benefits Advisors have shed some light on what benefits buyers are thinking about the programs in two new survey reports.
The IFEBP invited the benefits and human resources professionals in its databases to talk about a wide range of benefits topics, including private exchange programs, and received responses from 441. About 62 percent work at employers with 100 to 1,000 employees.
Pacific Resources, a benefits firm affiliated with Brown & Brown, polled benefits decisionmakers at a mix of employers with fewer than 5,000 employees and more than 5,000 employees. Pacific Resources focused on the participants’ views about private exchange programs.
The IFEBP and Pacific Resources found that private exchange programs already serve a small but noticeable percentage of employers, and that some employers are evaluating the possibility of trying the concept.
For more details about what the survey teams found, read on.
Analysts at Oliver Wyman and Accenture predicted a few years ago that private exchange programs could soon serve employer plans with about 40 million covered lives, or about one-quarter of all people with group health benefits.
Private exchanges do not seem to be anywhere close to achieving those sorts of numbers. But the IFEBP survey team found that 4.8 percent of the employers participating in their survey now use private exchange programs for active employees.
More — 9.7 percent — are thinking about using private exchange programs.
About 14 percent of the IFEPB survey participants use private exchanges for retirees ages 65 and older, and 14 percent are thinking about adding private exchanges for retirees.
Many of the Pacific Resources survey participants said their companies have looked into the private exchange idea in the past two years and decided against trying it.