The announcement yesterday that coffee shop chain Starbucks Corp. this October will give 157,000 U.S. employees new options to buy health insurance online is a harbinger that digital healthcare is taking hold in corporate America, say healthcare researchers and benefits consultants.
But many big companies are still looking for more valued-added services before making a decision to offer employees digital health insurance sign-up via a private health exchange, says Accenture health practice managing director Scott Brown.
In 2015, 8 million employees nationwide used a private healthcare exchange to comparison shop and buy health insurance online, up about 35% from six million employees in 2014, which was double the 3 million workers that used exchanges in 2013, Accenture says. “As administering health benefits becomes increasingly costly and complex, employers will explore new models to reduce cost and meet consumer demand for greater choice and more robust digital experiences,” Brown says.
Private exchanges do an adequate job of giving employers and their workforce a web-based platform to research and buy personalized health coverage and determine their individual covered services, deductibles and co-insurance payments based on the plan an employee selects, Brown says. For example Starbucks is working with its benefits administrator Aon Hewitt to enable its employees to long on to the Aon portal and comparison shop and buy insurance online from one of six national health insurance carriers.
But big companies like Starbucks that offer complex benefits options for an international workforce of up to several hundred thousand workers are looking for online health insurance programs to cut costs and offer new services. “They want proof that anything digital will yield a reduction in healthcare costs,” Brown says.
Big companies also want digital insurance delivery platforms to eliminate paper and manual administrative work, generate more detailed reporting and better decision support. “Companies want a compelling digital experience that is distinct from existing benefits providers,” Brown says. “This goes beyond simply providing an array of digital tools, because those tools must align to business objectives for plan sponsors using the exchange.”
Starbucks is the latest Aon customer to announce plans use Aon Active Health Exchange. Altogether more than 55 companies totaling more than a 1 million covered individuals use the private health exchange. Also growing, Accenture says, is the private exchange offered by Mercer, a unit of Marsh & McLennan Cos. Mercer now serves about 222 companies representing 630,000 employees compared with about 170 companies and 440,000 employees in 2014, Accenture says.
The biggest growth in employers using private exchanges is among companies with 100 to 2,500 employees, Accenture says, though it did not provide details on that growth. Private exchanges give smaller and midsized companies more affordable ways to offer their workers a bigger choice of health insurers or to offer health benefits for the first time.
“Growth continues to be fuel by midsized employers,” Brown says. “There is evidence of adoption by large companies, but many large employers continue to sit on the fence.”
Date: July 21, 2016