We’ve been powering private exchanges since 2006 and have seen firsthand how this strategic channel can give consumers more choice, help employers control costs and drive incremental business for our insurer clients.
Now with the opening of public exchanges we’re seeing more demand than ever from health plans who want to offer their own branded private insurance exchange, either as an alternative or complementary go-to-market channel. Why? Here are our top 5 reasons:
With a single-insurer private exchange, insurance providers can:
- Have a direct relationship with the consumer – this will help them design products that better meet the needs of different market segments, ultimately leading to increased revenue, customer satisfaction and retention.
- Control their own destiny – in the competitive post-reform world it’s critical that insurers remain in control of its product selection and presentation and are not forced just to compete on price, which can be the case with public or private multi-carrier channels.
- Keep up with market demands – to win insurers must offer the friendly and intuitive shopping experience that today’s consumers demand and continue to innovate to provide more functionality and better customer service down the road.
- Generate revenue from ancillary product sales – unlike public exchanges there are no restrictions on what insurers can sell through their own marketplaces. Sales of ancillary products are not subject to the same MLR restrictions as health plans making this an attractive option.
- Retain employers by offering a defined contribution funding mechanism – many large and small employer groups are dropping coverage due to rising premium costs, which is bad news for insurers. Giving employers a way to offer benefits while capping costs is winning proposition for them, their employees and health plans.