Data points toward an emerging consensus around the need for ecommerce capabilities that function across all lines of business

SEATTLE – July 28, 2016 – Array Health, a leading provider of private health insurance exchange technology, today released results from a new report, Health Check Survey: The Evolution of Private Exchanges as eCommerce Platforms for Health Insurance. This fourth annual survey of health insurance industry leaders finds that private exchange technology has rapidly evolved to meet the needs of insurers and the ever-changing health insurance industry.

With most health insurers having already implemented one or more private exchange technology solutions, insurers are now focused on how to widen their product shelves and increase the functionality and features of their private exchanges. Respondents to this year’s survey overwhelmingly stated that it was important that the private exchange platform support all lines of business (individual, group, retiree, etc.) and there was consensus around the technical difficulty of integrating with ancillary insurers.

While this report provides only a snapshot of industry sentiment around private exchanges, it does support analyst findings and third-party research that confirms an evolution of private exchanges in the market toward more robust and capable health insurance ecommerce platforms that are helping insurers to increase market share and revenue while reducing administrative costs. This year’s results were consistent with years past in some areas, but also show a shift in how health insurers attribute value from private exchanges. For example, respondents still view a good consumer experience and availability of ancillary products as key elements of a successful private exchange. A sizeable percentage of respondents this year also noted their organizations are not ready to support the back-end ecommerce capabilities such as processing payments and generating consolidated bills.

Key findings include:

  • Private exchanges continue to demonstrate business value by increasing sales and reducing administrative costs. More than half (52 percent) have increased market share, while almost 40 percent experienced a reduction in administrative costs. Almost half (45 percent) saw an increase in revenue as a result of their private exchange.
  •  The insurer-led private exchange market is becoming more mature. Insurers now recognize the importance of having a single platform for multiple lines of business and are placing greater value on the data generated by their private exchanges. Nearly 80 percent of respondents said that it is either “important” or “very important” for insurers to have one technology platform to support all lines of Generating data, which was ranked last in 2014, has now jumped to second place. This increased focus on data analytics is in line with the health insurance industry’s broadening recognition of data as a prerequisite for successful ecommerce.  
  • Insurers are also more aware of gaps in their back-end payment and billing processes to support their ecommerce efforts. Roughly a quarter of respondents said their organizations aren’t ready to support key parts of their ecommerce business: payment processing and consolidated billing. While more are prepared to process enrollments, almost 1 in 5 still feel unprepared.
  • The importance of having a broad product shelf composed of both health and ancillary products is now well established. At the same time, many insurers are finding the technical integration of these products difficult to achieve. In 2015 and 2016, survey respondents acknowledged the important role ancillary products play in improving the consumer shopping and enrollment experience on a private exchange. The technical integration to add ancillary product vendors to a private exchange is difficult according to the majority of survey respondents. Only 14 percent called the technical integration easy.

“Now in its fourth year, the Health Check survey provides valuable insights on how health insurance experts view the industry and the expanded role private exchanges play as they evolve into full ecommerce platforms for health insurance,” said Jonathan Rickert, CEO of Array Health.

About the Survey
68 leaders from across the health insurance industry responded to the online survey, which ran for two weeks in May 2016. The survey was sent to Atlantic Information Services (AIS) subscribers and was also made available in paper to attendees of this year’s Blue Summit in Orlando, Fla. View the full survey results here.

Array Health
Array Health brings consumers and insurers closer together by powering a personalized health insurance experience. Its cloud-based e-commerce software platform enables health insurers to deliver their own branded online exchange — including e-commerce support throughout the value chain of brokers, employers and consumers, across all lines of business. The company’s technology gives employers a new way to control costs and personalizes the health insurance experience for consumers, enabling them to make more informed decisions and to more deeply engage in their health. Array Health is a privately held company based in Seattle. To learn more, visit arrayhealth.com.

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For Array Health
Ulla Saleh
(206) 473-7410
ulla.saleh@arrayhealth.com