Prior to the signing of the Affordable Care Act (ACA), the term “exchange” meant something to military communities, stock or commodity traders and readers of historical fiction. Simply defined as “a place for buying and selling commodities, securities, etc.” (Dictionary.com), health insurance exchanges have existed for decades (the International Medical Exchange or IMX, for instance, was created in the mid-80s) but they were not widely recognizable or discussed. While the term has seen a spike in airplay since the ACA’s creation, and particularly in the last 6 months with the start of open enrollment on October 1, the general public’s understanding of exchanges remains…debatable. I used ehealthinsurance.com to purchase an individual policy for myself in 2006 between grad school and the start of my employer-sponsored policy. Even though I was among a minority who knew it was possible to buy health insurance online, I certainly didn’t know the site was an insurance exchange.
This lack of consumer recognition surfaced last January when Health and Human Services (HHS) acknowledged the shortcomings of the term “exchange.” In a blog post, Secretary Kathleen Sebelius formalized the federal government’s shift from “Affordable Insurance Exchanges” to “Health Insurance Marketplaces.” Coverage and commentary from HHS attributed the rebrand to two things: 1) clarifying the sites’ purpose for consumers and 2) being able to translate the phrase into Spanish more accurately.
The validity of the original choice to use “exchange” has been debated, and not bringing consumer marketing folks to the table sooner may have been a gross oversight. A lack of public understanding led to the rebrand; the term itself may be accurate, but it fell short with consumer recognition and couldn’t stand alone. At that point most of the state-run exchanges were branded already, and generally those names include some combination of the words: health/health plan, connector/find/link, and marketplace.
Over the course of 2013, most materials focused primarily on the public exchanges included lines in their introductions like: “…health insurance marketplaces, a.k.a. exchanges,” while those with a private exchange focus have started to include the inverse “…private exchanges, a.k.a. marketplaces.” Mutual acknowledgement of this deviation in terminology will continue, but whether the public sector’s use of “marketplace” will pull the private away from the term “exchange” remains to be seen. Toss into the mix a range of opinions on what makes a private exchange an exchange in the first place, and we’re in for all kinds of fun just communicating with each other in this space.
For now, we’re still seeing wide use of “private exchanges” and “exchange platforms,” with “marketplace” sometimes used to describe the consumer-facing or front-end component of a private exchange solution. For what it’s worth, I’m betting that a few years from now carriers, brokers, and employers will be buying complete “exchange” solutions that generally include a “marketplace” component as their front-end shopping interface. How those buyers then brand their platforms for consumers, which is really what HHS’s shift was about, is a whole different blog post.